Blog PostDecember 1, 2014

JCN CEOs In the News: Franchisees and the Minimum Wage

JCN CEO leader Stephen Bienko and IFA President Steve Caldeira speak to the Wall Street Journal about how forced minimum wage hikes would impact small business.

Job Creators Network CEO leader Stephen Bienko was cited in a Nov. 23 Wall Street Journal article about the push back by franchisees in response to highly-publicized efforts to force employers to pay higher minimum wages:

“Stephen Bienko, whose company owns College Hunks Hauling Junk franchises in New Jersey, Tennessee, Florida and Ohio, recently gave employees a tutorial showing the junk-removal industry’s average profits are 15% after costs such as rent, payroll and fees to the franchiser. Mr. Bienko said he pays $11 to $18 an hour but would have to pay everyone more if the lowest earners started making $15, which is the minimum hourly wage sought by the protesters.”

“It’s going to come out of the pocket of the small-business owner,” he said.

In addition, Steve Caldeira, president of the International Franchise Association (a JCN partner) explained that “a higher wage floor would lead to higher costs for consumers and less opportunity for entry-level workers.” Caldeira also told the WSJ that a recommendation sitting before the National Labor Relations Board could ice the future of the franchise business model by treating corporate “parent” companies like McDonald’s as “joint-employers” of workers at individual franchises:

“That could make the big companies liable for labor matters at these stores, including wages and working conditions, Mr. Caldeira said.

The trade group says that while 6% of its franchisee members operate more than 100 businesses, nearly half operate just one. It says store owners are responsible for their own labor matters, and it says changing that would destroy a business model of owner independence.”

Read more here.