question archive A woman claimed that she was sexually harassed by a male coworker at the franchisee's pizza store

A woman claimed that she was sexually harassed by a male coworker at the franchisee's pizza store

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A woman claimed that she was sexually harassed by a male coworker at the franchisee's pizza store. She sued not only the harasser and the franchisee but also the franchisor, Domino's, claiming that the franchise was the employer of those working for the franchisee and that the franchisee was the agent of the franchisor. The court recognized that the franchisor exerted control through "comprehensive and meticulous standards for marketing its trademarked brand and operating its franchises in a uniform way." Was Domino's vicariously liable for the conduct of the franchisee's employee?

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Answer:

In a franchisee franchisor relationship, in order to establish vicarious liability, we need to establish that franchisee is an employee of the franchisor.

In most instances (even in case of dominos) franchisees are usually controlled by the local business owner and even though they avail support and raw materials from the franchisor, the decisions are completely independent in most aspect. Due to this, a franchisee cannot be considered as an employee of the franchisor.

In this case the franchisor exerted control through comprehensive and meticulous standards for marketing its trademark brand and operating its franchises in a uniform way. However the bottom-line here is the standard. While the standards are set by the franchisor, Dominos, the decision to recruit and operate the store was of the franchisee. The controls exerted by franchisor is not direct and absolute. This is why the franchisee will be considered similar to an independent contractor for the franchisor. With such conditions, the doctrine of vicarious liability should not hold.

Thus, Dominos was not vicariously liable for the conduct of franchisee’s employee.

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