NCASEF Leadership Advocating on Behalf of California Franchisees

There is a serious situation brewing in California which will have major negative repercussions on franchisees who operate the more than 1,700 7-Eleven stores in the state.  California legislators are considering drastic changes or a total repeal the law that distinguishes between employees and independent contractors.   Your NCASEF Executive Board opposes amendments to this law commonly known as California AB 5.  This week we took steps including issuing a press release to national press outlets as well as to those in California. We are also coordinating a letter campaign to key lawmakers in Sacramento requesting they oppose these changes.

“There are more than 1,000 7-Eleven franchisees in California. AB 5 will help these operators have greater independence over how they run their stores, so they can support their families, support their employees and best represent the 7-Eleven brand,” said NCASEF Chairman Jay Singh.

SB 967 is among the amendments the National Coalition opposes. Proposed by Sen. Andreas Borgeas (R – Fresno), it would remove franchising from the list of businesses regulated by California Supreme Court’s Dynamex decision, which formed the basis of AB 5.  

“The way it is set up now, we are treated like store managers, but we are the ones who invest money in opening and operating the store. 7-Eleven even controls the air conditioning in a 7-Eleven store.  We have far less independence than franchisees at virtually every other brand that operates here,” said Jaspreet Dhillon, a Los Angeles area franchisee and president of his local Franchise Owners Association (FOA). “We need people to know that AB 5 is vital to protecting our interests.”

One of the chief proponents of weakening AB 5 is the International Franchise Association (IFA).  On its website they state “the only certainty of this law is that California franchise businesses may be in grave uncertainty.”  Keith Miller, a California Subway franchisee and principal owner of Franchisee Advocacy Consulting says the IFA has a long history of forecasting doom and gloom in instances here government regulators have intervened to protect franchisees interests. “The biggest myth is that the franchising industry is heavily-regulated; it’s not,” said Miller. “If the franchisees in the 7-Eleven system felt they were being treated as independent contractors – and had the basic tenets of business ownership – they would be supporting the measures to change AB 5. But they aren’t.”

NCASEF will continue our work of advocating on behalf of franchisees in California on this important issue and will update our members as the situation develops.