The Department of Labor announced it signed a cooperative agreement with Subway, the world’s largest franchisor. The agreement boosts Subway’s compliance with labor laws, helping ensure that workers get paid the wages they are legally entitled.
The agreement with Subway breaks new ground in how the Department of Labor can work with the regulated community — not only with employers, but with franchisors, suppliers, retailers and others — to channel their influence to ensure that all employers along a supply chain or otherwise linked in commerce play by the rules. The agreement builds upon the Wage and Hour division’s ongoing work to provide technical assistance and training to Subway’s franchisees. It also provides an avenue for information-sharing where the Department of Labor will provide data about concluded investigations with Subway, and shares Subway’s data with the Department of Labor, generating creative problem solving and sparking new ideas to promote compliance.
When necessary, the franchisor will remind franchisees of the Wage and Hour Division’s authority to investigate their establishments and to examine records. The agreement also specifies that Subway may exercise its business judgment in dealing with a franchisee’s status within the brand, based upon any history of Fair Labor Standards Act violations. The agreement provides a model for exacting compliance, at scale, in an industry that has experienced problems.
The Department of Labor calls its collaboration with Subway a recipe for success, demonstrating how government and industry can work together to protect vulnerable workers and ensure a fair day’s pay for a fair day’s work.