California Adopts Ill-Advised, Overly Broad Standard for Employment

May 03, 2018

FOR IMMEDIATE RELEASE

Contact:
Jenna Weisbord, 310-995-0839
jweisbord@franchise.org
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franchising411

California Adopts Ill-Advised, Overly Broad Standard for Employment

WASHINGTON, May 3—International Franchise Association Senior Vice President of Government Relations & Public Affairs Matt Haller issued the statement below following a decision issued by the California Supreme Court in Dynamex v. Superior Court. The ruling, which drastically alters the California standard for determining whether a person or entity is an employee, will negatively impact the ability of franchises to operate or do business in California. 

“By adopting the overly broad Massachusetts standard for determining whether an individual is an employee or independent contractor, the new California standard presumes employment and creates monumental challenges for businesses that operate with modern business models that fuel the growth of the economy.  Franchising plays an important economic role in California, representing 76,000 locations that support nearly 730,000 jobs. This ruling threatens our industry and will not only hurt future job creation, it will undermine California’s economic success.

“Before making such an drastic change, this issue should have had at least some modicum of legislative consideration.  It was ill-advised for California to adopt this sweeping change without weighing the opinion of lawmakers."

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About the International Franchise Association
Celebrating 56 years of excellence, education and advocacy, the International Franchise Association is the world's oldest and largest organization representing franchising worldwide. IFA works through its government relations and public policy, media relations and educational programs to protect, enhance and promote franchising and the more than 733,000 franchise establishments that support nearly 7.6 million direct jobs, $674.3 billion of economic output for the U.S. economy and 2.5 percent of the Gross Domestic Product (GDP). IFA members include franchise companies in over 300 different business format categories, individual franchisees and companies that support the industry in marketing, law, technology and business development.