The general counsel of the National Labor Relations Board (NLRB) has handed down a decision that could have implications for the millions of Americans who work for franchises.
After investigating claims that some McDonald's restaurants broke labor laws by firing or penalizing workers who took part in pro-labor activities, the NLRB's general counsel said if the owner of a McDonald's fast food franchise commits a labor violation, the McDonald's corporation can be held jointly liable for the franchisee's bad behavior.
For now, the decision affects only the McDonald's corporation and McDonald's franchises. There are 3,000 other brands with franchise operations in the U.S., employing 8.5 million people across a range of industries, according to the International Franchise Association (IFA).
The IFA's Matthew Haller says the decision could destroy the franchise industry. Franchises may bear the names of big companies, he said, but they are owned and run like small businesses.
"They set the wages, they hire and fire the employees, determine the appropriate benefits for employees and are responsible for all decisions that take place at the employee level," Haller said.
The NLRB's general counsel said the McDonald's Corporation exercises enough control over how franchises are run to make it a co-employer of the people who work for franchises.
"They do exercise quite a bit of control over their franchisees in order to protect their brand," said Wilma Liebman, a former chair of the NLRB who has been advising the SEIU, a union that is working to organize fast-food workers.
What McDonald's Corp. controls and what it doesn't is laid out in the terms of its franchise agreement. So even though other franchisees in other industries are watching the decision closely, it's not yet clear how this will affect other companies. McDonald's said in a statement that it plans to contest the NLRB's decision.
Twitter released its quarterly results and they were impressive — shares jumped nearly 20 percent today.
The social media giant says they have picked up 16 million users in the last few months, making a grand total of 267 million users on Twitter. On top of that, revenue more than doubled thanks to new types of mobile ads.
Of course, revenue and profit aren’t quite the same thing. Twitter is still losing money.
That might sound surprising, but it’s actually pretty typical for tech companies, which tend to have a business plan that strongly resembles the business model of the Underpants Gnomes from South Park.
"It’s actually a very good business model," says Erich Joachimsthaler, CEO of Vivaldi Partners.
OK, he’s actually not talking about the underpants gnomes, he’s talking about Twitter and other tech companies, which tend to follow a plan that looks something like this:
PHASE 1: Attract millions of users with free services.
PHASE 2: Figure out some way to exploit those users.
PHASE 3: Make millions of dollars.
We’ve seen this work time and again, says Joachimsthaler - think Google and Facebook.
"As habit forms and as millions of people become hooked, Twitter has an opportunity to add advertising [and] some e-commerce functions, basically monetizing the asset," Joachimsthaler says.
But that could be tricky for Twitter. Advertisers love Facebook because it knows so much about its users and there are so many of them, says Ken Wilbur, assistant professor of marketing at UC San Diego's Rady School of Management.
He says they don’t love Twitter quite as much.
"When you put ads into the Twitter feed itself, it lowers the utility of Twitter to its users," Wilbur says. "And they don’t have a great platform for putting ads next to the feed."
Wilbur says it remains to be seen whether Twitter can find a way to fully monetize its users. It could either be the next Facebook or the next Friendster. At one time, Friendster was the biggest social network on the web, with more than 100 million users and now it’s a gaming site based in Malaysia.
Ah, the pitfalls of phase two.
The tiny European country of Moldova isn't known for much of anything, and especially not its wine. But its winemakers are trying to find new export markets and overcome their post-Soviet reputation.
At a divorce workshop called Second Saturday, women of all ages are packed around a large conference table. One of them is Jenny Juffs. She’s divorcing after 19 years of marriage and has two special needs children. Like many women, Juffs is pretty shocked by her new financial reality.
“I’ve been a wife or homemaker all my life," she says. "Everything’s changing for me. I’ve never managed money.”
This situation is particularly grim for older women. Today, a quarter of divorced women over 60 live in poverty. Overall, older women see their household income drop by 41 percent. That’s twice the amount of their ex-husbands. And, to make matters worse, baby boomers are splitting up at record rates.
"So we are seeing these 20, 25, 30, 35-year marriages coming apart, with the women who have never worked outside of the home," says financial advisor Grace Antares.
Antares heads Portland’s local chapter of Second Saturday. Many people who come to her divorce seminar are completely inexperienced when it comes financial planning. She often sees panic. Like one middle-aged woman who fled the room: “She explained to one of my colleagues that she was going through what felt like PTSD to her, that she had been separated from her husband for 10 years and had made every single mistake that we had mentioned in the first part of the class.”
So, financial literacy is important. But Antares says the biggest contributor to post-divorce success is earning power - and some women who spent more of their time focusing on the family lack job skills.
As for Jenny Juffs, she's trying to build basic skills, like keyboarding. "I know how to use a computer a little bit, but not Office or Excel or anything that anybody’s going to need.”
Antares says even women who have good jobs can make poor financial decisions after divorce. And the closer to retirement these mistakes are made, the more devastating the effect. Grace Antares is now 64-years-old, and has her own story.
"I was highly emotionally attached to the house," she says. "I pulled out the equity to pay him, I was the bigger earner, paid him a big settlement. Then, when the real estate market crashed, the house was underwater instantly. And so he got all the tax-free cash, and I got a foreclosure and a bankruptcy.”
Antares' own experience is what helps fuel the one message she repeats all the time: “You’re going to be in charge of your finances for the rest of your life."
Hamas militants are using tunnels in and out of Gaza to strike inside Israel. Israelis are questioning how the tunnels grew to be so complex and why the military hasn't been able to shut them down.
Arthur T. Demoulas, chief executive of the New England grocery chain Market Basket, was pushed out by his cousin in a boardroom struggle. Protesting employees have brought business to a standstill.
A jury had found the bank liable for fraud related to mortgages sold by its Countrywide Financial unit last October. Bank of America may appeal.
Nearly two weeks since a Malaysia Airlines flight was downed over eastern Ukraine, fighting in the region continues to delay the start of an investigation. For more, Audie Cornish speaks with Paul Sonne, the Moscow correspondent for the Wall Street Journal.