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Subway, DOL Compliance Deal a New Franchising Template?

Aug. 1, 2016, 9:30 PM

The Subway restaurant chain is partnering with the Labor Department to improve wage-and-hour compliance at its 27,000 franchised stores, creating a potential industry template but raising questions about joint employment.

Under a voluntary agreement announced Aug. 1, the DOL’s Wage and Hour Division will meet regularly with Subway to share enforcement data and explore how franchisees can use scheduling and payroll technology to avoid overtime violations.

The negotiations were guided by a pair of bottom lines: Subway insisted that it mustn’t face added risk of Fair Labor Standards Act joint employer liability, while the DOL needed to...

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