FTC Seeks Public Comment on Franchisors Exerting Control Over Franchisees and Workers 

The Federal Trade Commission (FTC) is seeking comment on franchise agreements and franchisor business practices, including how franchisors may exert control over franchisees and their workers. 

In a franchise relationship, franchisees typically pay a fee in exchange for a business format or system developed by a franchisor, the right to use the franchisor’s trademark for a specific number of years, and assistance. Owning a franchise, however, comes with defined costs, franchisor controls, and contract terms. 

The FTC would like to know more about how franchisors may exert control over franchisees and their workers. Specifically, the FTC is interested in how franchisors disclose certain aspects and contractual terms of the franchise relationship, as well as the scope, application, and effect of those aspects and contractual terms.  

As part of the Request for Information, the FTC is asking franchisors, franchisees, current and past employees of franchisors and franchisees, government entities, economists, attorneys, academics, consumers, and other interested parties to weigh in on a wide array of issues that affect franchisees and their workers