Team leadership should be caution of any external attempts to limit the organization’s flexibility to respond decisively to potential misconduct. The CFIL, codified at Corporations Code sections 31000 through 31516, is designed to regulate franchisors’ dissemination of information to prospective franchisees, allowing the prospects to make informed decisions regarding their potential franchise investments. Note: Many franchise attorneys will discount their fees substantially if you are working with an established franchise consulting firm, as this will make their jobs much easier. While this allows them to work at a reduced fee (lower billing rates for associates), it may make them less familiar with your documents when questions arise. According to some reports, there was concern that the team may have had “buyer’s remorse” over a recent three-year contract extension awarded to Olshey given the team’s mediocre on-court performance and decreased revenues related to the COVID-19 pandemic. The recent termination of Portland Trail Blazers General Manager Neil Olshey has brought workplace culture. Data was cre at ed with G SA Content Gener ator DEMO!
In early November, the Portland Trail Blazers announced it had opened an internal investigation into their General Manager following reports of a toxic work environment, including allegations of profanity-laden tirades directed at non-player personnel. The idea that a team could decide to terminate a general manager for one or more basketball-related reasons but simultaneously pursue misconduct allegations with the hopes of finding a reason to terminate the general manager for cause gave executives pause. It is far likelier that the general managers association would advocate for “best practices” to be taken during internal investigations, or seek to adopt standardized contract provisions to help provide additional “process” for general managers accused of misconduct. In fact, the only notable example of a coaches’ association taking a position counter to its league came in a 2011 amicus brief filed by the NFL Coaches Association in support of the NFL Players Association during the league-instituted lockout. Conte nt has been gener ated with the help of GSA Con tent Generator D emov er si on!
Unlike the players they frequently draft, sign, and trade, however, general managers are afforded no protections under the National Labor Relations Act, the federal law which governs labor relations in the private sector. 7-Eleven, which was filed by five 7-Eleven franchise owners, is whether the Massachusetts law that distinguishes between an independent contractor and an employee applies to franchisees. What sets our team apart is highly skilled attorneys with specialized skill sets in business and corporate law, employment law (including employee benefits issues), finance and lending, tax law, and intellectual property (including trademarks, copyrights, and trade secret protection and litigation). Under Massachusetts law, there is a three-part test, called the “ABC” test, that determines whether someone is an independent contractor or an employee. The International Franchise Association says businesses as diverse as restaurants, hotels, automotive service centers, gyms, hair salons, and landscaping businesses could become reluctant to expand in Massachusetts if the independent contractor law applied to them. In addition to 7-Eleven, many of the biggest chains operating in Massachusetts – Dunkin’ Donuts, McDonald’s, Burger King, and Subway – operate in a franchise model. While Liss-Riordan says she is focused on the specific circumstances of franchisees at 7-Eleven, franchising companies say the case could have broad implications.
The Supreme Judicial Court will hear arguments Wednesday in a case that could upend the way state labor laws apply to franchise business owners. The owners cannot also be held legally responsible should the business be taken to court for whatever reason. While the investigation was pending, rumors swirled that the investigation was aimed at uncovering a reason to terminate Olshey for “cause” under his contract rather than addressing serious workplace misconduct. What do franchise owners and leagues need to know about these concerted efforts and how would any such association limit a team’s ability to respond to misconduct allegations in the future? As shown in the Olshey case, teams need to be able to react swiftly to allegations of misconduct, particularly from high-ranking officials. As any employer would do, the Trailblazers took the allegations seriously and even engaged outside counsel to lead its investigation. In reality, however, it is doubtful that any such associations would take such ill-advised actions, as they would most likely lead to negative publicity and reduce the chances of landing another job for another organization in the future. Above all, however, you should remember that you have a duty to promptly investigate and remediate any potentially unlawful behavior by their employees-regardless of how high in the organization the alleged perpetrator may be.
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