Franchise Agreement Prevents Server From Suing Pizza Chain for Sexual Harassment She Encountered at Work

In a ruling that appears to represent a setback for workers, the California Supreme Court recently decided that the sexual harassment a restaurant server suffered on the job only allowed her to sue the franchisee that owned the location where she worked, not the restaurant chain as a whole. Since the chain did not manage or control its franchisees, it could not be liable for their misconduct.

The suit arose from Taylor Patterson’s employment at a Thousand Oaks Domino’s Pizza restaurant. According to the teen, during her brief time as a server at the business, she suffered multiple instances of sexual harassment, both of the physical and verbal varieties, by her manager. The server sued Domino’s for multiple violations of the Fair Employment and Housing Act, including sexual harassment, failure to take the appropriate measures to prevent harassment, and retaliation against her for reporting harassment.

The crux of Patterson’s case centered less on whether the server suffered sexual harassment, but more on the legal relationship between her and Domino’s. Patterson claimed that both she and her manager were employees of Domino’s, and the pizza chain was liable for the manager’s actions, while Domino’s argued that that its contractual arrangement with its franchisees made clear that its franchisees were independent entities and that neither the server nor the manager were its employees.

The trial court agreed with Domino’s, but the California Court of Appeal sided with the server. The Supreme Court ultimately concluded that the trial court was correct. The facts of Patterson’s case, in the court’s opinion, made clear that Domino’s did not have an employer-employee relationship with the workers at the Thousand Oaks restaurant. The franchise agreement between Poff’s LLC and Domino’s stated that the workers at the Thousand Oaks restaurant were not agents or employees of Domino’s. The contract gave the LLC sole responsibility for recruiting and hiring employees, and Poff testified that he alone carried out the employee interview process. Other than training Poff himself, the franchise agreement expressly removed from Domino’s the right or the obligation to train the workers at the restaurant.

This lack of control and authority by Domino’s proved telling. The Supreme Court wrote that Domino’s would only have been liable for the manager’s conduct “if it has retained or assumed a general right of control over factors such as hiring, direction, supervision, discipline, discharge, and relevant day-to-day aspects of the workplace behavior of the franchisee‘s employees.” In Patterson’s case, Poff, not Domino’s, held the control over those duties at the Thousand Oaks restaurant. As a result of this arrangement, which was written down in the contract, and the evidence indicated was carried out in practice, Domino’s could not be held liable.

Despite the unfavorable outcome for the worker, Patterson’s case nevertheless offers assistance for other victimized employees who seek to hold a franchisor like Domino’s liable, since the court’s opinion offered helpful guidance on what the law requires to show franchisor liability. If you have been sexually harassed at work, you need a skilled and knowledgeable advocate on your side to advise and represent you in carrying your case forward. Consult the experienced Oakland employment law attorneys at the Law Offices of Stephen M. Fuerch. Our employment law attorneys can help you decide on a plan for seeking the recovery you deserve.

Contact us through our website or call our office at (925) 463-2575 to schedule your confidential initial consultation today.

More Blog Posts:

Northern California Mom Launches Class Action Against Employer for Refusing to Extend Reasonable Accommodation of Her Pregnancy, Oakland Personal Injury Attorney Blog, May 30, 2014

Employee Allowed to Pursue Sexual Harassment Case, Despite Language in Job Application, Oakland Personal Injury Attorney Blog, April 30, 2014

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