California Assembly Stands Up for Small Businesses with “Yes” Vote on AB 525

Sacramento, CA – Kathryn Slater-Carter, a McDonald’s franchise owner for more than 30 years, joined the Service Employees International Union California in praising the Assembly’s vote to pass AB 525 (Holden), the Small Business Investment Protection Act.

“The Assembly’s ‘Yes’ vote on AB 525 is a vote to protect 80,000 franchised small businesses and the investment we’ve made in creating over one million California jobs. Today, multi-billion dollar corporations like McDonald’s can seize the small business a franchise owner has spent a lifetime building, with no reason at all,” said Slater-Carter. “AB 525 fixes this fundamental unfairness and helps stabilize small businesses so we can continue serving the needs of California’s communities and providing jobs that build our economy and provide for families.”

“SEIU California recognizes the Assemblymembers who supported AB 525 to correct the flaws in a franchise system that is stacked against workers and franchised businesses alike. California workers have joined hundreds of franchisees in supporting AB 525 in order to give franchisees a fair shot to build businesses and invest in good California jobs,” added Laphonza Butler, President of SEIU California.

In April, the market research firm FranchiseGrade.Com released a survey of 1,100 franchise owners that found dissatisfaction with franchisors – the parent corporations of franchise businesses – is widespread. Franchisees reported frequent retaliation against franchise owners who speak out about problems. The financial strain franchisors put on their small business partners is evident, with more than half of franchisees reporting they can’t earn a living from their business. Four in 10 reported threats of having their franchise agreements terminated for taking actions they thought were appropriate for their business, and nearly 20% said their franchisor increased the frequency of inspections after the franchisee raised questions or spoke out about problems.

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