The Federal Trade Commission (FTC) has published a request for information seeking comment on the franchisor-franchisee relationship, expressing concern about "unfair and deceptive practices in the franchise industry." Comments are due by May 9. We've gathered articles on the news from trusted sources.

FTC Announcement

"The FTC hopes to hear from a broad range of stakeholders about how the franchise relationship is working, and how it is not," said Samuel Levine, director of the FTC's Bureau of Consumer Protection.

The request for information will "begin to unravel how the unequal bargaining power inherent in contracts is impacting franchisees, workers and consumers," said Elizabeth Wilkins, director of the FTC's Office of Public Planning.

(FTC news release)

Questions About Wages and Working Conditions

The request for information includes the following questions:

• How do franchisors exercise control over the wages and working conditions in franchised entities other than through the terms of franchise agreements?
• What service-based quality control measures, whether imposed through licensing or other agreements, depend on franchisee employee performance?
• What data do franchisors collect and retain regarding franchisees' employees, labor and employment law compliance and labor costs?
• How do these practices affect franchisees, consumers, workers and competition?
• How prevalent are these practices?
• What justifications exist for these practices?

(FTC request for information)

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