The United States Court of Appeals for the First Circuit previously reviewed the case and certified a question to the Massachusetts Supreme Judicial Court (SJC) regarding whether the three-prong test for independent contractor status applies to franchise relationships. The SJC concluded that the test does apply but requires a case-specific examination of whether the individual performs any service for the alleged employer. The First Circuit then certified a second question to the SJC, asking whether the plaintiffs perform any service for 7-Eleven under the Massachusetts independent contractor statute, given their contractual obligations and the franchise fee structure.

The Massachusetts Supreme Judicial Court held that the plaintiffs do not perform any service for 7-Eleven within the meaning of the independent contractor statute. The court reasoned that the franchisees operate their stores independently and chose to use the 7-Eleven brand for its market benefits. The court emphasized that the franchisees’ compliance with 7-Eleven’s standards is necessary to maintain the brand’s integrity and does not indicate an employment relationship. Therefore, the court answered the certified question in the negative, concluding that the plaintiffs are not employees of 7-Eleven under the Massachusetts independent contractor statute.

The post Are Franchisees Independent Contractors? appeared first on Amann Burnett Law.