The Aging Workforce: A Challenge for Franchise Systems?

Franchise systems employ over 8.5 million Americans – with more than 20 million employed in related and supporting businesses, resulting in 15% of all U.S. private-industry jobs. That’s a lot of people!

But how many of them are getting older? Well everybody … but the largest segment of our society will soon reach traditional retirement age and may continue working. This may present some unique challenges for employers. Franchise systems are not immune from this trend.

With the advance of years, come physical and cognitive limitations that can affect an employee’s performance. So when this occurs franchise-system-employers can just get rid of the faltering employee right? Maybe not.

While “age discrimination” may be the most obvious concern, amendments to the Americans with Disabilities Act (“ADA”) substantially broaden the protections available to aging employees (actually any employee) who develop a “disability.” With these new protections come expanded burdens on employers which may have a profound effect on how employers deal with their older employees.

A brief overview may help franchisors AND franchisees avoid unwanted legal claims.

The Americans with Disabilities Act

• The ADA applies to employers with 15 or more employees;

• The ADA applies to employees with a “disability.”  In the simplest terms, anyone who has a physical or mental impairment that limits their normal lifestyle or major life activities, will be deemed to have a disability;

• Only a disability which affects job performance or the ability to perform any aspect of a job is relevant;

• Once identified or obvious and a determination is made that a disability affects job performance, the employee or their representative may request a “reasonable accommodation” as necessary to perform their job to the satisfaction of the employer. The request for an accommodation must be made by the employee or their representative unless it is obvious that the employee is unable to make the request on their own behalf.  As a practical matter, however, when  a disability is obvious to an employer, it is recommended that the employer take affirmative steps to ask the employee if they want an accommodation;

• When the employee requests accommodation, the employer may ask for reasonable documentation to support the request.  Doctors’ reports, medical instructions or other supporting documentation may be requested. Documentation can come from a health care provider or rehabilitation professional. The request  must be limited to the disability and the accommodation issues (not all medical records);

• Once the documentation is obtained or the employer is otherwise adequately informed, the employer should meet with the employee and conduct an interactive meeting to discuss possible accommodations that may work for the employee and be satisfactory to the employer (the EEOC offers this explanation: The employer and the individual with a disability should engage in an informal process to clarify what the individual needs and identify the appropriate reasonable accommodation. The employer may ask the individual relevant questions that will enable it to make an informed decision about the request. This includes asking what type of reasonable accommodation is needed);

• The only statutory limitation on an employer's obligation to provide "reasonable accommodation" is that no change or modification is required if it would cause "undue hardship."  "Undue hardship" means significant difficulty or expense and focuses on the resources and circumstances of each employer in relation to the cost or difficulty of providing a specific accommodation. Undue hardship is determined through a “circumstances” test which considers not only financial difficulty, but whether reasonable an accommodation is unduly extensive, substantial, or disruptive, or would fundamentally alter the nature or operation of the business.

Again, while there are many nuances associated with the above factors and each case is different, the basic steps outlined above generally apply to any circumstance involving a disabled or aging employee. Please keep in mind that your state may also provide protections for disabled employees.

Given the complexity of workplace protections today, it is always wise to consult your legal counsel before a simple employment matter spins out of control.