$15 An Hour: He’s The Only Guy In Franchising Who Thinks We Should Pay It

It’s true. There’s one person in the franchise industry who thinks that upping the minimum wage to $15.00 an hour (from $7.25 currently) would be a great move. But why? And, who is he?

The Franchise King®. Joel Libava.


First the why.

Because it’s the right thing to do. $7.25 an hour doesn’t buy too many groceries. Or make much of a dent in the “paying rent” category. And, a car payment? Fawget about it.

A Discussion

This is a hypothetical discussion between a local franchise owner (in the city of your choice) and myself.

Joel, it’s not my problem if someone I’m employing can’t pay rent, buy food, or make a car payment. I didn’t put them in the predicament they’re in.”

“Well, paying them $7.25 an hour actually is your problem. Could it be why you have a revolving door-as in high employee turnover?”

Joel, it’s not like high-quality potential workers are lining up outside the door of my franchise business to work here. I have to hire people from the pool of potential employees who show up.”

“I understand. You may not know this, but I used to be in food-service management. I interviewed potential hires. I helped train them. And, I fired the ones who didn’t work out. I get it. It’s hard to find good employees. The kind that show up on time…as opposed to the kind that go on a bender for 4 days in a row…no-shows who expect to have a job to return to. It sucks. So, why not offer more money so you’ll get a higher-quality worker?”

I don’t see how offering $15.00 an hour would help me attract better workers. I don’t see the correlation.”

“You don’t see how offering double what you pay now would attract better workers?”

Hey…I’ve given my employees raises when they deserve it-and they just leave anyway. So, I figure-what’s the point?”

“The point is if you start off with a higher-quality worker, you may find that not only are they better employees, but that they’ll want to show up…and they’ll want to work hard. IN ORDER TO KEEP THEIR BETTER PAYING JOB.”

The IFA Newsletter Is The Problem

I receive the International Franchise Association's Newsletter.

For awhile, it was pretty good. The editors linked to some pretty good articles-useful ones for folks in the franchise industry. That’s starting to change.

For the past 9 months or so, the bottom section of the newsletter has included “commentary” regarding the proposed $15 an hour minimum wage increase, NLRB rulings, overtime etc. This commentary, often in the form of an op-ed, consistently slams proposed wage ideas….and as an added bonus, President Obama and his administration.


(Image is in the public domain)

Before you go down the “Joel is showing his true colors-he’s obviously a Democrat” road, know this: I don’t plan on supporting Hillary Clinton for President this fall. Capisce?

In addition, as you can plainly see, I totally disagree with the NLRB joint employer ridiculousness. Overtime is another story. Pay it.

An Agenda?

The IFA seems to have an agenda-and this agenda was even more obvious when Steve Caldiera was running the show. Well, after Caldiera left because of a contract dispute, I was hoping that things would settle down a bit. I was hoping that the IFA would once again be the champions of franchising instead of staying in the lobbying lane-in politics. Not.

The IFA has an agenda, and it has nothing to do with making franchising better.

Their agenda is an anti-Obama one. It’s one of contributing lots of money to legislators that hate Obama, too. And, it’s an anti-$15 an hour minimum-wage one. History will show that their agenda was the wrong one to have. More and more of our citizens are demanding change. Part of the change they want has to do with leveling the playing field, income-wise.

$15 An Hour Must Happen

Employers need to step up and pay their employees a wage they can live on. Period.

But, Joel, you don’t own a retail franchise or a food franchise. You don’t know how hard it is to make a buck. Not only that, we have to pay royalties to the franchisor…thousands of dollars a month.”

(I shared a possible solution to the royalty dilemma in this short column I wrote for the New York Times.com)

The local franchisee quoted above is right: I don’t currently own a franchise. I help people find the winners so they can be their own boss.

But, I do know this: If employers…franchisees, don’t start paying their employees a living wage, nothing’s going to change.

Employers will still have high-turnover.

The anger in our country will increase.

Less people will want to start a business.

You don’t have to believe me. Heck, you don’t even have to agree with me. I don’t care. As my friend, Carly Israel just wrote in her excellent Huffington Post piece, “What others think about me or say about me is not my business.”

One More Thing

Let me start this section off with a declaration.

I am not a financial expert. I didn’t graduate from Wharton. I’m not as smart as my friend Carol Roth-who totally disagrees with what I’m about to tell you.

Paying your employees more will help the entire economy, because the more people make the more they’ll spend.

So do it.

(The Franchise King®, Joel Libava, is a top franchise expert, the author of Become A Franchise Owner! (Wiley Publishing), and owns and operates Franchise Business University, where you can increase your franchise IQ with the online franchise courses offered there.)