Jun 14, 2016
According to an article by Julius Melnitzer in the Financial Post, a new concept called “joint employer status” could have a significant impact on the Canadian franchise industry. The notion of joint employer status is supported by unions and other employee advocates who maintain that franchisees and franchisors have such a close relationship that they should be deemed to be “joint employers” of a franchisee’s employees. As a result, franchisors could be subject to a broad range of employment-related claims brought by employees. In his piece, Melnitzer solicits feedback about this emerging concept from a number of lawyers, including Osler’s Andraya Frith, chair of the firm’s National Franchise and Distribution Practice Group, and litigation partner Jennifer Dolman.
Andraya comments that “[w]e have already seen an increased risk of joint employer status in the United States and the shifting legal landscape on joint employer issues in Canada appears to be headed in the same direction.”
Legal experts predict that the issue of control will be central to determining whether a joint employment relationship exists. “If franchisors start exercising too much control over the nitty-gritty of employment practices, particularly hiring and firing, they could be creating a risk that they’ll be characterized as joint employers,” Jennifer explains.
Read more about this emerging change in employment law and its potential impact on the franchise industry in Julius Melnitzer’s article ‘Joint employer’ status could rattle franchise industry: ‘It will be a game-changer’ in the June 14, 2016 online edition of the Financial Post.