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Employer Liability Issues › Employment Litigation › Franchise Agreements

Polsinelli

Landmark Texas Supreme Court Case Finds No “Direct Liability” for Franchisor Arising Out of Franchisee Employee’s Actions

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On May 2, 2025, the Texas Supreme Court reversed a Texas Court of Appeals’ decision that had affirmed a jury’s verdict finding a franchisor directly liable to the customer of a franchisee for actions undertaken by the...more

Lewitt Hackman

Franchisor 101: Joint Employer? Check √

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A Maryland federal district court denied a restaurant franchisor’s motion to dismiss, concluding that a restaurant manager at a franchised location alleged sufficient facts to support a finding that the franchisor is a joint...more

Troutman Pepper Locke

Seventh Circuit Revives McDonald's Employee No-Poach Litigation

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In June of 2022, McDonald’s obtained a judgment on the pleadings, ending antitrust litigation challenging the legality of the no-hire restraints it previously included in its franchise agreements. More than a year later, the...more

Lathrop GPM

Maine Federal Court Grants Franchisor’s Motion to Dismiss Age Discrimination Claim Brought by Franchisee’s Independent Contractor

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A federal court in Maine granted a franchisor’s motion to dismiss claims asserting that a franchisor was liable for its franchisee’s alleged age discrimination in employment. Goodwill v. Anywhere Real Est., 2023 WL 4034372...more

Lewitt Hackman

Franchisee 101: No Joint Employer, No Cry

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A federal district court in New York dismissed workplace harassment and retaliation claims against corporate affiliates of the Golden Krust Caribbean Bakery & Grill franchisor for damages as a result of workplace harassment...more

Ogletree, Deakins, Nash, Smoak & Stewart,...

Eleventh Circuit Serves a Whopper of a Ruling on Franchisor’s ‘No-Poach’/‘No-Hire’ Agreement With Franchisees

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​​​​​​​Over the last several years, business-to-business “no-hire” and “no-poach” agreements have come under legal attack, including through enforcement actions by the Federal Trade Commission and criminal prosecutions by the...more

Carlton Fields

Sixth Circuit Affirms Ruling That Arbitrator Is to Determine Arbitrability of Employment Dispute Between Franchise Employees and...

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The plaintiffs filed a class action against Domino’s, alleging that the company’s franchise agreement violated federal antitrust law as well as state law. ...more

Littler

Highest Court in Canada Says Substance, not Form, will Determine Independent Contractor or Employee Status

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A recent Supreme Court of Canada (SCC) decision considered whether a franchisee who entered into a franchise agreement with a franchisor was an employee or an independent contractor. The fact-specific case, Modern Cleaning...more

Polsinelli

Anti-Poaching Provisions in Franchise Agreements Are Drawing Increased Scrutiny

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Franchise agreements often contain provisions prohibiting the franchisee from soliciting or hiring workers employed by the franchisor or other franchisees. Such “anti-poaching” agreements have recently come under increased...more

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