5-Member Board Set to Change Fundamental Franchise Law
Because Congress and the President have had a legislative death grip on one another for as long as most people are able to remember, one might think that little is being done in Washington D.C. One would be wrong. Even though the passage of significant legislation seems like a pipe dream to folks on both sides of the aisle, that doesn’t stop regulators and others from enacting rules and making decisions that can impose sweeping changes on the way we do business. Regulation of the Internet is on deck, but currently at bat is a proposed reinterpreting of the relationship between a franchisor and franchisee. No happy meal at the NLRB The general counsel to the five-member National Labor Relations Board (NLRB) has issued an opinion that employees in McDonald’s restaurants across the land are not solely employees of the individual franchise operators, but that the McDonald’s corporation itself is a joint employer. If this opinion is allowed to stand, it would make McDonald’s and other large corporations responsible for labor violations committed by individual franchise holders. The NLRB is a quasi-judicial body that decides cases involving labor law. This, as many observers have put it, upends decades of legal precedent and has the potential to set off a tidal wave of changes in franchise industry that could lead to a retrenchment within the industry, if not the wholesale closing of some franchise locations across the country. “I operate as an independent stand-alone business. I have the autonomy to run my business as I see fit, but if the Labor Board radically changes the joint employer standard, I fear that my days as a business owner will be numbered,” says John Sims, owner and operator of Rainbow Station at the Boulders in Richmond, Virginia. Sims and his wife have 40 employees and were considering opening another location. But with this and other regulatory changes in the offing, they have decided to put their expansion plans on hold for the time being. With all the uncertainty in the air, it’s likely that this picture is being repeated in virtually every state. The goose that laid the golden egg This is tragic because the franchise sector has been leading our economy out of its doldrums. A study recently released by IHS Economics predicted that franchise businesses would add 247,000 new jobs in 2015, coming off the heels of 235,000 new jobs in 2014. This 2.9 percent growth rate would mark the fifth consecutive year that job growth in the franchise sector outpaced non-franchise workforce job creation. However, at this point, the NLRB opinion is not settled law. In fact, a recent decision in federal court seems to up hold the traditional view that individual franchisee owners are the employers of local workers. According to the International Franchise Association, in a case involving a massage therapist who alleged violations of minimum wage laws, Judge Roger T. Benitez of the U.S. District Court for the Southern District of California ruled on January 6 that Massage Envy, a corporate franchisor, was not the employer of therapists in its franchisees’ California stores. Further, the Republican-controlled Congress is stirring on the issue. A hearing was held in the Senate and legislation may be introduced to head off the NLRB at the pass. Even if you aren’t a...
read moreHow to Protect Your Valuable Social Media Contact Information
Who gets your social media contacts when you die? I ask the question partially in jest, but a very close variation to that query has become an important issue in law: Who gets the professional social media contacts when one of your employees leaves? The specific issue here deals with LinkedIn accounts. See if any of this sounds familiar, or at least feasible: You encourage an employee to establish a LinkedIn account and make contacts with clients and potential clients. He or she downloads the company phone list from the server on your company’s LAN and uses that info to identify more possible LinkedIn contacts. The employee does well and even starts a professional group on LinkedIn, garnering more contacts. More valuable than paper clips Of course, all good things must someday end and this employee moves on to start a competing business. Many employees will walk out with the company stapler and a ream of copy paper, but what about these contacts? Who now owns this goldmine of professional contact information? Before you render your legal opinion, let’s add one more wrinkle: According to the LinkedIn user agreement, “If you are using LinkedIn on behalf of a company or other legal entity, you are nevertheless individually bound by this Agreement even if your company has a separate agreement with us.” Now what do you say? As our use – nay, dependence – on social media increases, the law is having a bit of a struggle keeping up with the pace, so we can expect more clarity/confusion (choose one) on this in coming years. However, so far US courts seem to be siding with the individual. After one Pennsylvania woman’s former company terminated her, the company took over her LinkedIn account, changed all its details and “assigned” it to its interim CEO. Citing the LinkedIn user agreement, the court ruled on the side of private individual ownership of the social media profile. However, it didn’t find that the company had caused any damages to the woman. The worst-case scenario But what if the employee were to take that valuable contact information and use it to jump start a competing company? This brings the issue into sharp focus. And with the addition of other problems, like cyber bullying, there is no doubt that every business needs a comprehensive social media policy. To deal with the question of who owns and controls accounts such as LinkedIn, you need to spell out your expectations for the use of professional contact information gathered while employed. For example, if an employee gets the personal email address of a client, must it be uploaded to the company’s master database of contact information? Don’t allow a scattered network of employees to be the sole repositories of this valuable data. Also, clearly define who owns this information and how it may be used appropriately. You need to anticipate employees leaving and how this will be reflected in social media profiles. You can require employees to “disconnect” from your clients that they met solely through the auspices of your company, although in practice this may prove difficult. That makes non-compete and non-solicitation agreements even more important. If you don’t have these kinds of agreements, now is the ideal time to put them in place. Look at the issues...
read moreWill You Buy Your Next House On Your Smartphone?
We know that the mobile revolution is well underway and is becoming a major player in ecommerce. The Starbucks app, for example, has become very central to the coffee purveyor’s success. However, mobile ecommerce is beginning to impact far bigger and pricier purchases than a Venti Caramel Brulée Lattee. According to a Bankrate survey, almost half of everyone who surfs the mobile web has already made a “major financial commitment” like acquiring a car, insurance, stocks, or a mortgage on their mobile devices. If you watch live television and aren’t able to zip past all the commercials, you have probably noticed how heavily TrueCar is promoting itself. And if you check out the company’s website, you’ll see that they put a huge emphasis on their mobile app. The money trail Watching where ad dollars are going is one of the best ways to get a handle on trends and TrueCar is investing heavily right now. (By the way, when Amazon experimented with online car buying back in 2000, it didn’t work out for them.) Although about half of all mobile users say they have made at least one major purchase in this way, only 12 percent say they use their phones or tablets “always” or even “most of the time” for these big-ticket items. We can expect that number to go up dramatically as mobile device sales continue to outpace desktop and laptop sales. Further, in the 30-49 year age group, 58 percent reported making a major purchase via some kind of mobile device. On the other hand, more than 60 percent of those age 65 or above said they never bought a big-ticket item through a mobile device. We can also expect these numbers to increase when Millennials get north of 30 years old. Right now, many Millennials aren’t heading up households, so they are less inclined to be the persons who make these buying decisions. When they become homeowners, have families and start building up investment accounts, we can expect them to rely heavily on their mobile devices. The mobile app alternative Normally at this point, I’d put in a pitch for creating a mobile app for your business – and I do think that’s a good idea. However, we’re finding that mobile users spend 80 percent of their time on just five apps. In other words, many specialized apps are seldom used. They often end up living on deeply buried screens or deleted entirely. This highlights the importance of your mobile website. You may not be able to convince a mobile user to keep your app on his or her device, but if you have a great mobile website, you may be able to capture those eyeballs anyway. As you review and test your mobile website, put yourself in the position of a mobile user and make sure the site is useful, functional and friendly. Ask yourself this question: If a mobile user was about to buy a big-ticket item on a mobile device, does my website make that purchase easy?...
read moreThis Week in Small Business: Learn from the big guys, compete with the big guys
There are a number Big-Biz-Small-Biz David and Goliath themed stories this week, and let’s be sure that the Bible isn’t the only place where David reliably wins! Marketing We’re always talking about thinking “outside the box.” Here are three marketing campaigns that took major risks and actually worked. If you woke up this morning thinking that Google was the #1 producer of referral web traffic, you were wrong. Social Media referrals now have the top spot. Here are some great fundamentals of website design and implementation that convert prospects along with some examples. Spotify (good) : Macy’s (bad). How can you seize what is called “the mobile moment”? Mobile marketing is more than finding a developer to build an app for your business. Also, get up-to-speed on the variations in location-based mobile advertising. Are geo-conquesting ads in your future? The single most important element of any marketing plan is knowing who your targeted customer is. Here are four tips to getting it right. You also need to know how they behave. Finally, to personalize your marketing efforts, here are the sites, services and steps. If you have three and a half minutes to spare and need a good primer on how to create an email marketing campaign, this video from Constant Contact fits the bill. Then to build your list, several of these 10 tips will prove extremely helpful. Need inspiration to find the ideal place to shoot a marketing video? YupVideo offers some practical advice. Continuing on this subject, here are five things your video marketing strategy should include. Inspiration What good can come from bickering children? Her four imps inspired Laurie Canata to create a successful startup. Inspiration is where you find it. Successful people never fall into the traps of these 10 behaviors. Women in STEM professions have been lagging. However, one place where they are dominating is big data, i.e. statistical analysis. What can you learn about realizing the American Dream from the American Girl (dolls)? Here is a lesson in entrepreneurship. Provide a unique and incredible customer experience if you want your business to grow crazy fast. Jeremy Sandow takes us to Seattle for an example. Economy, government and politics Surveys are like the weather. If you don’t like what you have right now, just wait a few hours. Gallup says that optimism among owners of small businesses in the US is the highest it’s been since 2008. Then again, this NFIB January survey says optimism has ticked down a couple of points. (Choose one.) Writing for The Hill, Amit Narang says the Republicans are pushing a bill in the name of small business that is really merely a way to deregulate some big businesses. Stock market gains have fueled the recent appetite investors have had for startups. Will the trend continue? So far the plunge in oil prices hasn’t caused panic among small business owners in North Dakota; they see it as short term. And even though oil is down, Texas is still creating jobs in non-energy sectors. It’s not your parents’ “small business” anymore: The revolution in what it means to be a small business. There are major free trade agreements on the table. Get the big picture and see how your business might fit in. In the name of small business,...
read moreDoes Your Valentine Work in the Next Cubicle? Trouble May Be Brewing
There’s a standard scene in many movies where a woman becomes involved with a man but wants to keep the budding relationship secret. Invariable, either at work or a social gathering, a close friend will say, “Something’s different about you. Are you seeing someone?” You’ve probably been in this situation, as either the primary subject or the astute observer, and with more women at all levels of business, it’s becoming increasingly common a work. Often the “tells” aren’t all that subtle: Co-workers who previously were casual friends start to avoid each other or exhibit awkwardness. A pair of co-workers start to log a lot of the same overtime hours as well as the same days off from work. New “inside” jokes start popping up. The couple seem to be enjoying their time at work when everyone else is in crisis management mode. If you’re any kind of student of human nature, I’m sure you can add several more clues to my little list and they’re fun to watch for when you aren’t the one involved in the new office romance. However, a far more important subject involves the reasons why we all need to be very cautious before we step into those treacherous waters. The Google canoodle One of the most devastating public cases that demonstrates some of the dangers was when Google co-founder Sergey Brin hooked up with an employee (who herself had been involved with another Google employee), breaking up his marriage to Anne Wojcicki. The couple have two children. Although Wojcicki wasn’t working at Google, her sister was senior vide president of advertising. By the way, Google had invested in his former wife’s company, which (conveniently) sells home DNA testing kits. I wonder how many lawyer salaries were funded for a year or more sorting out all of these legal entanglements. Work romance is widespread Surveys differ on the number but somewhere between 40 and 60 percent of all workers way they have dated a colleague. About a third of those say they married the person they met at work, Career Builder says. By the way, if you’re looking for a career and a spouse, according to the Career Builder survey, the five top industries for office romance are: Leisure and Hospitality Information Technology Financial Health Care Professional & Business Services But I digress. Despite those marriages, it is still far better to be extremely wary of office romance. Here are some of the reasons: A sexual harassment suit is never out of the question. Workplace gossip can undermine your authority, credibility and ability to advance. Arguments can spill over from your personal life to your business. It can be a major distraction for everyone at work. If a third of these romances ended in marriage, two thirds didn’t. It can get ugly at breakup time. Not only is it wise to be very cautious on the personal level, it’s smart to establish policies and train your employees on them. This is especially critical for any employees in supervisorial roles; the line between flirting and harassment can be very blurry and you don’t want it to suddenly come into sharp focus when an angry employee shows up in your office with an...
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