In 2020, banks had to contend with general new underwriting guidance in SOPs, COVID-19 specific underwriting guidance, and the rules about the Paycheck Protection Program (“PPP”). All of these circumstances impacted the availability of funding for franchisors and franchisees. Despite the uncertainties about the economy and trend towards more conservative lending, the good news is
The COVID-19 pandemic has dramatically impacted business in 2020, from government stay at home orders that prevented operations to adjusted customer service capacity or additional safety procedures. Some of these changes to your franchise system may be what the FTC or states regard as “material”, meaning the change likely affects a prospective franchisee’s conduct or…
Developing a Social Media Policy for Franchise Systems
Effective use of social media is challenging for any business, but creating a strategy that works for an entire franchise system can be even more difficult. Once that strategy is developed, it needs to be supplemented with a social media policy that protects you and your franchisees.
Below are four things to consider as you develop a social media policy.…
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COVID 19 undoubtedly impacted your business. Franchise systems in a wide array of industries experienced temporary closures, forced innovation in the delivery of goods and services, and altered unit economics. Some of these changes may qualify as “material” changed under state and federal law and will need to be accounted for in an amendment to the 2020 FDD. The federal and state requirements are outlined below and will help you to determine if and when you need to amend your FDD because of COVID-19.
Continue Reading Do I Need to Amend My FDD to Account for the COVID-19 Pandemic?
The FTC Rule allows some franchisors to be exempt from the franchise disclosure document requirements. There are seven stated exemptions, and some of them are tied to certain monetary values. The FTC is authorized to adjust them every fourth year based upon the Consumer Price Index so that the laws are still relevant in changing economic conditions. The Commission is required to update the monetary exemption thresholds in 2020.
The following adjustments will go into effect on July 1, 2020:
Perhaps you’ve heard about the California Legislature’s efforts to target misclassification of employees in the gig economy.
While the law passed in September 2019 had obvious impacts on companies like Uber and Lyft, it can also significantly affect franchisors. AB 5 increases the likelihood that a franchisee or franchisee’s employees will be viewed as employees of the franchisor, which dramatically increases the franchisor’s obligations to them.
Read on to learn how legislation in California may effect you.
On Sunday, January 12, 2020, the U.S. Department of Labor (DOL) released the final version of its rule interpreting joint employer status under the Fair Labor Standards Act (FLSA), which regulates minimum wage and overtime.
The DOL adopted a four-factor test, which considers whether an alleged joint employer:…
Continue Reading DOL Raises Joint Employer Threshold