McDonald’s Franchisee Takes on Corporate Control

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Aug. 14 (Bloomberg) -- McDonald’s franchise owner Kathryn Slater-Carter talks with Betty Liu about her battle with the corporation about the rights of franchise owners to run their restaurants as independent businesses. She speaks on “In The Loop.”

Joining us on the disappearance, slow disappearance on satisfries from burger king.

Staying with fast food on a very different issue.

Mcdonald's franchise fight continues to heat up, particularly in california where new legislation is being pushed in front of the state a family that will give rights to franchisees.

As its owners and franchise groups are speaking out against this bill.

In a statement issued yesterday, the international franchise associations as the california legislation is "a trial lawyer's fantasy that will result in countless frivolous lawsuits that will only add costs to consumers.

At the same time, and have the potential to lower the value of our small businesses, a franchise owner's hard orearned equity at risk." catherine slater of carter, thank you so much for joining us this morning.

What is your response to this statement?

Good morning.

It is nonsense.

We are using almost word for word a law that was applied to the auto dealer franchises in 1973. this law has been tried and tested and has been on the books for decades.

Ok.

basically found like what you're saying is you are harking back to what has been in place before for other industries, but when you talk to other franchisees, kathryn, many of them disagree with what you are pushing through.

I want to play for you what robert wicca has to say about this on the program yesterday.

Of this in all rb -- this nrlb ruling is about getting members.

If they were able to unionize our industry, it would be over a hundred million dollars that they do not have now, so it is about the money.

It is about the business model, and i am not saying that the union is good or bad.

If you are a coal miner, you probably need a union.

Whether or not one shop as opposed to another shop is to be unionize because of working conditions, i don't know.

That, is of course in relation to the nlrb decision, but we are all talking about the same issue, which is franchisees and the ownership and relationship with the franchisors.

What did you make about his comment about the union?

I think he is mixing apples and bananas.

The nlrb ruling really has nothing to do with sb610. it came out of a bill we started three years ago, ab2305, and it started out -- 610 started out asking for good faith and fair dealing about treatment for franchisees because currently under current law in california, the franchiseors are the judge, jury, and executioner of everything that happened to a franchisee.

So the nlrb ruling assembly -- is simply an interim process.

We will see what happens, but 610 is about being able to have the rights to assemble and meet with other franchisees without having a corporation there.

And you say the corporation purposely, and in your dealings with mcdonald's, have purposely sort of controlled your operation so much to the point that they leave you with small margins.

In fact, that is what has been going on with greater and greater frequency in the industry.

I started in this industry about 35 years ago, and now it is completely different, so as the corporations turn their attention more to wall street and away from main street, they have forgotten about what it takes to run a business and to be able to get margins for your own business.

Franchisees are told this is their own business.

Kathryn, it sounded like when we were reading through your post you recently wrote, it sounded like you were in support of the nlrb ruling, which would in fact consider the franchisee and the franchisor as one joint company.

Wouldn't you be against something like that?

You know, what i was attempting, perhaps clumsily, to say is that as appropriations have gotten more and more -- as corporations have gotten more and more involved in the minute to minute operations of the franchisees' business, this is a larger logical, evolutionary outcome.

I do not really have a position on it.

This text has been automatically generated. It may not be 100% accurate.

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