Business Licenses and Permits:: Published by Corporation Service Company » Blog Archive » Franchise business licenses under consideration in Mass.

Lawmakers in Massachusetts are considering changes to the state’s franchise business licenses.

Two bills are under discussion that would add further regulation to the system and clearly define the relationship between franchisees and parent companies.

The Boston Globe reports that there are around 14,000 franchise businesses in the state and one of the bills would clarify the employment status of these companies, protecting parent corporations from certain costs like paying overtime.

A second bill considers giving local franchise owners greater legal protections in any dealings with their parent companies, such as protecting them from terminating a contract. They could also be given monetary damages if a new business opens nearby and affects sales.

Lawyer Robert Zarco, who specializes in franchise licenses, told the news provider of the current situation without the new bills: “These franchise agreements are extremely one-sided. You are left on the street with nothing.”

However, the trade group the International Franchise Association opposes further regulation of business licenses, but supports the notion that franchise owners should not be classified as employees.