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DOL Playbook

Published by on July 20, 2011

The U.S. Department of Labor has published on its website a report entitled “Improving Workplace Conditions Through Strategic Enforcement.”  The report is the DOL’s playbook on how to attack franchising and other “non-traditional” employment relationships.  More on this — and “priority” industries (i.e. targets) — after the break. What is the motivation for the DOL […]

The U.S. Department of Labor has published on its website a report entitled “Improving Workplace Conditions Through Strategic Enforcement.”  The report is the DOL’s playbook on how to attack franchising and other “non-traditional” employment relationships.  More on this — and “priority” industries (i.e. targets) — after the break.

What is the motivation for the DOL to attack business relationships such as franchises or independent contractors?  The report reflects the view that the use of independent contractors and related practices is “a means to subvert compliance with labor policies.”  (p.10)  Characterizing these relationships as “fissuring” of the employment relationship, the report asserts that “fissuring arises from a desire to shift labor costs and liabilities to smaller business entities” and “to avoid mandatory social payments . . . or shed liability for workplace injuries.”  (p.21)  The report goes on to compare franchises to “sweatshops.”  (p.22)

Who are the “priority industries” targeted by the DOL report?  These include:

  • eating and drinking establishments
  • hotel/motel
  • residential construction
  • janitorial services
  • moving companies
  • agricultural products
  • landscaping
  • health care services
  • home health care services
  • grocery stores — retail trade
  • department stores and mass merchants

What are some of the methods advocated in the report for “ensuring compliance”?  More litigation.  Pushing franchisors to accept chain-wide “agreements” regarding compliance.

Here is the report.  (Contact us if you would like a PDF copy.)

As we noted earlier this year here, the DOL budget includes $50 million to “combat worker misclassification.”  It appears that the playbook has funding as well.

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