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United States Department of Labor Issues New Rule Limiting Franchisor Joint Employer Liability

Franchise
Franchisor Joint Employer Liability

In January, the United States Department of Labor (“DOL”) issued a rule that will make it more difficult for workers to hold franchisors like McDonald’s and other fast food, convenience store, and gas station outlets liable for wage violations committed by their franchisees. The rule goes into effect this month. This rule is a natural extension of the DOL’s previous move rescinding Obama-era guidelines that expanded the definition of “joint employer” under the Fair Labor Standards Act to encompass more franchisors.

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