Arlen Specter Oppostion to Card Check – Will Not Change!

The Huffington Post reports that Sen. Arlen Specter (R-Penn.) is becoming a Democrat but his opposition to the Employee Free Choice Act (Card Check) will not change.

“I have decided to run for re-election in 2010 in the Democratic primary,” said Specter in a statement. “I am ready, willing and anxious to take on all comers and have my candidacy for re-election determined in a general election.”

“Since my election in 1980, as part of the Reagan Big Tent, the Republican Party has moved far to the right. Last year, more than 200,000 Republicans in Pennsylvania changed their registration to become Democrats. I now find my political philosophy more in line with Democrats than Republicans.”

The move will give Democrats a filibuster-proof 60 vote majority in the Senate, presuming Minnesota’s Al Franken is eventually seated. However, in his statement Specter said his opposition to the Employee Free Choice Act — widely seen as a defense against a Republican primary challenge — will not change.

Polls had shown that, despite his shift on EFCA, Specter was on his way to losing his seat if he stayed in the GOP. A Rasmussen survey from last Friday had former U.S. Rep. Pat Toomey beating the Senator by 21 points in the primary.

Sources told the AP that an announcement could come later in the day — or Wednesday.

Vice President Joe Biden and Pennsylvania Gov. Ed Rendell have urged Specter to switch parties in the past.

President Obama called Specter Tuesday to say Democrats “are thrilled to have you.”

The Huffington Post

Changes to COBRA benefits

When President Obama signed the American Recovery and Reinvestment Act of 2009 (ARRA)—also known as the Stimulus Package—the government took steps to expand access to health insurance for the millions of Americans who lost their jobs by amending the provisions covering the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA). The changes to COBRA benefits impact employers, like Dunkin’ Donuts franchise owners. All private employers that offer a group health insurance plan and that have 20 or more employees are impacted by these changes; those with fewer than 20 employees also are impacted to some degree.

Generally speaking, for workers and their families who have lost their group health insurance coverage, COBRA provides the opportunity to continue coverage through the former employer’s plan at their own cost.

ARRA provides qualified individuals with a 65% government subsidy of COBRA premiums. In addition to meeting income threshold requirements, individuals who are eligible for assistance must:

1. be employees involuntarily terminated between September 1, 2008 and December 31, 2009;
2. be eligible for COBRA continuation coverage; and
3. elect COBRA coverage.

The COBRA premium subsidy is available for a period of coverage beginning February 17, 2009, provided the qualified individual pays 35% of the premium due. The subsidy is good for nine months or once the person is covered by a new group health plan or Medicare.

Beth O’Neal of Masterman, Culbert & Tully, LLP, a Boston law firm, points out that employers may recover their COBRA premium costs through a payroll tax credit. A new IRS Form 941 must be used to receive the premium subsidy reimbursement. If an employer’s payroll taxes are not sufficient to support the amount of the subsidy, a credit or refund will be issued.

According to Jim Munro of Paychex, a payroll, human resources and employee benefits company that is a DDIFO Associate Member and works with some DD franchises, “We are already working with clients to implement these changes.  If you are using an outside payroll or benefits provider, make sure your vendor is actively following these developments and is ready to take appropriate action.”

April 18, 2009  was the deadline for posting a new COBRA notice to all individuals who had a qualifying event (e.g. an involuntary termination, a reduction in hours resulting in a loss of benefits, or resignation) on or after September 1, 2008 even if the individuals previously declined COBRA coverage.

The U.S. Department of Labor has set up a special website to explain the latest COBRA-ARRA related information for employees and employers,

For employers with fewer than 20 employees, many states have established “mini-COBRA” statutes governing health insurance coverage continuation. Families USA, a non-profit, non-partisan organization, provides information on what individual states are doing for workers at small businesses who lose their jobs. You can find out how each state is changing its laws here.

Bringing Fairness and Transparency to the Credit Card Market

ACTION ALERT: Credit Card Interchange Fees

The House of Representatives will debate a consumer credit card bill on the floor next week and we need your help to gain support to insert interchange fee provisions into the final floor version of the bill.

Representatives Peter Welch (D-VT) and Bill Shuster (R-PA) are going to offer the Welch-Shuster interchange fair fee amendment to the Credit Cardholder’s Bill of Rights Act (H.R. 627) next week when it is considered on the House Floor. We believe the language will be similar to the Credit Card Interchange Fees Act.

The Credit Card Interchanges Fee Act

Visa and MasterCard control roughly 80% of the payments card market and abuse that market power by refusing to negotiate rates and terms with the merchants who accept their cards. Credit card interchange fees are the only operating cost merchants are powerless to negotiate and these growing costs are one of the largest business expenses companies face. Interchange fees – averaging roughly 2% a transaction – take a bigger chunk out of retailers’ bottom line than both energy and health care costs.

These are extraordinary economic times. Main Street businesses are struggling to keep their doors open and these anticompetitive rates and terms are hindering their ability to do so, and to keep prices low for the customers they serve. Additionally, these fees are particularly harmful to small business. Small business is the backbone of job creation in this country, and placing undo burdens on small merchants, particularly in the current environment, is unconscionable.

This legislation would eliminate the anticompetitive rules Visa and MasterCard impose on merchants, allowing merchants, for the first time in regard to card acceptance, fundamental decision-making rights in how they run their business. This legislation will increase transparency in the payments card industry and make the true cost of card acceptance evident to consumers who have also been deprived of the right to make an informed decision regarding their choice of payment.

Eliminating Visa and MasterCard’s restrictive merchant rules is critical to create a fair and transparent payments system that fosters both consumer and merchant choice.

Summary of Welch Interchange Legislation

Part 1: Prohibit anti-competitive practices.  These all address practices that are banned by the contracts merchants sign with Visa and MasterCard.  We believe that these are fundamental rights that ensure an open, competitive market and should not be able to be limited by the credit card companies.

• Eliminate Additional Charges for Premium Cards or access devices.  This section prevents credit card companies from charging the merchant more when a customer uses a “special” card, like a rewards card, or a corporate card or internationally issued cards.
• Pricing display restrictions. This section allows merchants to offer a lower price for customers who pay with lower cost payment types or devices.
• “Honor all cards” rule.  This section allows merchants to choose not to accept certain cards that have especially high fees.
• Steering customers.  Allows a merchant to ask a customer if he/she is willing to use an alternative payment device.
• Single entity rule.  Allows a business to not accept cards at a given location.  E.g. a company with a website and a retail store can decide to accept payment types and devices for their online business, but not in their retail location.
• Reason code 96 chargebacks.  Relevant mostly at the gas pump where when you swipe a card, a $75 transaction is authorized.  As gas prices rise, these transactions are frequently exceeding the $75 authorization amount.  We’ve heard reports that Visa is denying any repayment to the merchant in some of these situations.  This section prohibits that.
• Maximum/minimum transactions.  Allows merchants to set a minimum for purchases initiated with a credit card or other payment device (many places do this anyway, like $5 minimum, but it technically violates the rules).  Also would allow merchants to set a maximum so that transactions don’t exceed the preauthorization amount discussed in the previous section
• Restrictions on network routing on PIN transactions.   Allows merchant to choose which financial routing network to use (Cirrus, NYCE, Interlink, etc) based on which is least costly for them.
• Restrictions on number of Transactions. This section prevents credit card companies from requiring any merchant to conduct any minimum number of transactions for using such network’s payment device during any given time period.

Part 2: Disclose Rules and Provide FTC Authority to Eliminate Anticompetitive Rules. This section requires MasterCard and Visa to disclose all terms, rates, and conditions to the FTC and allows the FTC to review and determine if any practices are anti-competitive.

Part 3: Require full disclosure of interchange or other fees collected from merchants to the Fed and the public. Creates mechanism through the Federal Reserve for the disclosure and publication of full terms and conditions of the credit card company contracts.

Part 4: Require full disclosure of interchange or other merchant-paid fees to consumers.  Requires credit card companies to disclose to consumer in several places the interchange rates they are charging.

To find your elected officials, The Coalition of Franchisee Association (CFA) offers a great resource to help you identify both your National and Local elected representatives:  register here

Send this letter to your Congressman Today!

Dear Representative:

I am writing to ask you to co-sponsor an amendment on credit card interchange fees to be offered by Congressmen Peter Welch (D-VT) and Bill Shuster (R-PA) when H.R. 627, the Credit Cardholders’ Bill of Rights, is considered on the House floor in the next few days. Interchange fees are uncontrollable and one of the largest business costs our company faces. Addressing these out of control fees is a very necessary part of comprehensive credit card industry consumer protection reforms as rising interchange fee costs significantly impact our ability to keep prices low for customers.

Curbing abusive credit card industry practices without addressing interchange fees is unrealistic. These hidden fees have tripled since 2001 and last year cost Main Street businesses and American consumers, who are struggling to get by in this tough economy, roughly $48 billion. There is a complete lack of competition and transparency in the current system as Visa and MasterCard and the big banks use their market power to set anticompetitive interchange rates and contract terms.

The Welch-Shuster interchange amendment will eliminate the anticompetitive rules Visa and MasterCard impose on merchants, allowing merchants, for the first time in regard to card acceptance, fundamental decision-making rights in how they run their business. This amendment will also increase transparency in the payments card industry and make the true cost of card acceptance evident to consumers who have also been deprived of the right to make an informed decision regarding their choice of payment.

I strongly encourage you to co-sponsor the Welch-Shuster amendment before the early morning filing deadline on Tuesday, April 28. The Welch-Shuster amendment will bring much-needed competition and transparency to the credit card industry and provide needed relief for small businesses and consumers struggling to stay afloat.  Please contact Calvin Garner in Mr. Welch’s office at 202-225-4115 or calvin.garner@mail.house.gov or Maribeth Collins in Mr. Shuster’s office at 202-225-2431 or maribeth.collins@mail.house.gov to cosponsor the amendment.

Sincerely,

Small Business Owners Brace for Tax Battle

Under Obama Plan, Some Entrepreneurs’ Bills Would Soar

Lori Montgomery and V. Dion Haynes of the Washington Post report that Gail Johnson doesn’t think of herself as wealthy. The former pediatric nurse has spent 20 years building a chain of preschools and after-school programs that accommodate sick children so working parents can keep their jobs.

But, like most small-business owners, Johnson reports her profit on her personal tax return. In a typical year, she and her husband make more than $500,000, according to her accountant, a figure that throws them squarely into the ranks of the richest Americans — and makes them a prime target for the Obama administration’s tax policy.

Since last year’s campaign, President Obama has vowed repeatedly not to increase taxes for families making less than $250,000 a year. That pledge, while politically popular, has left him with just two primary sources of funding for his ambitious social agenda: about 3 million high-earning families and the nation’s businesses.

Johnson, with her company, falls into both categories. If Obama’s tax plans are enacted, her accountant estimates that her federal tax bill — typically, around $120,000 a year — would rise by at least $23,000, a 19 percent increase.

“You hear ‘tax the rich,’ and you think, ‘I don’t make that much money,’ ” said Johnson, whose Rainbow Station programs are headquartered near Richmond. “But then you realize: ‘Oh, if I put my business income with my wages, then, suddenly, I’m there.’ ”

Across the nation, many business owners are watching anxiously as the president undertakes expensive initiatives to overhaul health care and expand educational opportunities, while also reining in runaway budget deficits. Already, Obama has proposed an extra $1.3 trillion in taxes for business and high earners over the next decade. They include new limits on the ability of corporations to automatically defer U.S. taxes on income earned overseas, repeal of a form of inventory accounting that tends to reduce business taxes, and a mandate that investment partnerships pay the regular income tax rate instead of the lower capital gains rate.
‘A Permanent Target’

Business groups say they’re bracing for even more battles with the administration.

“They’re desperate for revenue. And therein lies the concern of the broader business community,” said R. Bruce Josten, chief lobbyist for the U.S. Chamber of Commerce.

“We’re going to be a permanent target, and we understand that,” added Catherine Schultz, vice president for tax policy at the National Foreign Trade Council. “The way they see it, corporations don’t vote.”

Obama has proposed some business tax breaks, but those proposals have been dwarfed by the tax increases under consideration, particularly his plan to let tax cuts enacted by former president George W. Bush expire for high earners.

Administration officials say they would simply restore rates in effect during the Clinton administration for every dollar of income over $250,000 ($200,000 for individuals). The plan is intended to counter years of rising inequality in which wealth has been concentrated at the top of the income scale.

Washington Post

Swine flu: A proactive Response

Employers should now start taking precautionary steps to respond to the growing outbreak of swine flu

Nixon Peabody LLP issued this OSHA Alert on 4/28/2009

On Sunday, April 26, 2009, the U.S government declared a public health emergency concerning the outbreak of swine influenza A (H1N1; “Swine Flu”). As of the date of this Alert, only a limited number of cases of swine flu infection in the United States have been confirmed. The largest outbreak has occurred in Mexico.

The declaration of a public health emergency is obviously important and indicates that public health officials view this outbreak as a potential serious threat. However, it is also important for employers to put the declaration  in perspective and  help employees avoid undue fear. This declaration does not mean that the outbreak has become a pandemic or that a pandemic is imminent. In fact, the declaration is actually a standard early step procedure that results in monitoring and testing of suspect cases, triggers additional reporting protocols, and increases media and public outreach to get information and warnings out.

Watch this Video on Swine Flu from the Center of Disease Control (CDC), Atlanta, GA

Employers should likewise now take early stage action to educate employees and prepare for the impact of a swine flu outbreak in the workplace. This recommendation is particularly true for high-risk workplaces such as hospitals, medical offices, schools, and workplaces that provide services to high-risk populations. However, it is prudent for all employers now to take precautionary steps. Most employers can best do so through a written communicable illness response plan, which then serves as a guide for management and employees.

For those employers who have such a program in place, now is the time to review and update your program and activate it. For those employers who do not yet have a program, now is the time to implement one. Waiting until a crisis occurs is waiting too long. It is virtually impossible to develop and effectively implement such a program under crisis conditions, and by waiting, you will miss the opportunity to take proactive preventative steps.

Read the whole article at Nixon Peabody LLP

Swine Flu Scare Causes Starbucks to Close 10 Mexican Stores

Starbucks Corp. has temporarily closed 10 cafes in Mexico in respond to the swine flu outbreak there.

The Seattle coffee company (NASDAQ: SBUX) has about 260 stores in Mexico and has heeded Mexican government orders to close 10 of those stores in urban areas, mostly in and around Mexico City, said Kate Bovey, a Starbucks spokeswoman at the company’s headquarters.

In an effort to combat the flu outbreak, Mexican authorities have ordered restaurants, cafes and other businesses closed. The government also has put restrictions on the hours some businesses can operate.

“They just don’t want crowds,” Bovey said.

Bovey said the cafes are mostly near large population centers such as shopping malls and universities.

She said the number of Starbucks cafés closed in Mexico could fluctuate.

Starbucks managers are keeping a close eye on the medical crisis and monitoring updates from the World Health Organization and Centers for Disease Control.

“We are a global company,” she said. “We have operations in 50 countries. It’s certainly important to monitor this.”

In a company statement, Starbucks said the swine flu outbreak has not impacted Starbucks operations outside of Mexico.

Puget Sound Business Journal

Sen. Arlen Specter is Switching to the Democratic Party

Kent Hoover, Washington Bureau Chief of the Washington Business Journal – reports that the democrats are closer to having the 60 votes needed to overcome procedural hurdles in the Senate now that Sen. Arlen Specter, R-Pa., has decided to switch parties.

“I have decided to run for re-election in 2010 in the Democratic primary,” Specter said in a statement published Tuesday on Politico’s Web site. “I am ready, willing and anxious to take on all comers and have my candidacy for re-election determined in a general election.”

Specter faced a strong challenge in the Republican primary from conservative Pat Toomey, a former House member.

“I am unwilling to have my 29-year Senate record judged by the Pennsylvania Republican primary electorate,” the statement read. “I have not represented the Republican Party. I have represented the people of Pennsylvania.”

Specter said he knows he “will be disappointing many friends and supporters,” but he is “disappointed that so many in the party I have worked for for more than four decades do not want me to be their candidate.”

Specter’s defection would leave Republicans with only 40 votes in the Senate. If Al Franken is seated as a senator from Minnesota, Democrats would reach the 60-vote threshold. This could enable them to overcome Republican efforts to block legislation.

Specter was one of only three Senate Republicans who supported the economic stimulus legislation. Democrats had hoped to win his support for the Employee Free Choice Act, legislation that would allow unions to organize workplaces by obtaining signed cards from a majority of employees instead of going through a secret-ballot election. But Specter announced earlier this year that he would oppose that bill, dealing a severe blow to that bill’s prospects.

It’s unclear how Specter’s party switch will affect his stance on this bill.

Washington Business Journal

Roger Deslauriers Celebrates 50 Years as a Franchise Owner

As we celebrate our 50th anniversary as a Dunkin Donuts franchise owner, we are proud to announce that three of our stores now feature a great number of energy efficient and environmentally friendly products and services, including solar electric power. Dunkin Donuts has long been a cornerstone of the New England way of life, and it is only fitting that we take a leadership position to help drive “greenovation” throughout our community.

To commemorate this landmark achievement, we will host a ceremony on Friday, May 1, 2009 at 11:00 a.m. Eastern time at the Dunkin Donuts store at 219 South Main Street in Attleboro, Mass. All Dunkin’ Donuts franchise owners are cordially invited to attend, joining business leaders, local dignitaries, and other esteemed members of our community as we unveil one of the first fast food restaurants in the U.S. to adopt solar energy. The event will include tours of this innovative facility, as well as remarks from the visionaries who helped make this milestone possible.

We recognize the importance of alternative energy to the future of our economy-including the creation of much-needed jobs-and believe our involvement contributes to the state- and nation-wide commitment to clean, renewable energy. We look forward to seeing you at the event, and hope that our efforts inspire other franchisees to go green.

Art Krebs of Construction Art a DDIFO Associate Member will be present, he said “it’s a great opportunity to celebrate the the 50th anniversary occasion and promote awareness of Dunkin’s green involvement and solidarity with their communities.”

See: Dunkin Franchisee Sees Green for Profits

DDIFO to Attend AAFD Annual Conference

Kevin McCarthy the Chairman of the DD Independent Franchise Owners (DDIFO) Board of Directors will be attending the American Association of Franchisees and Dealers (AAFD) Annual Conference, April 30th thru May 3rd on the Riverwalk in San Antonio, Texas.

Kevin is pleased to represent DDIFO at the conference, he said, “I look forward to meeting  franchisee association leaders to network, share ideas, best practices and specifically learn ways to empower franchise owners and enhance positive communications with franchisors.”

The theme for the 17th annual AAFD Meeting is  “Harnessing the Power of Your Collective Voice.” Program co-chairs, Boston attorney Eric H. Karp and business coach David Drewelow, have issued an invitation and pledge to all franchisee groups urging a record setting gathering of existing and forming franchisee associations:  “Join our celebration of Total Quality Franchising as we focus on strategies and tools to achieve great franchising cultures based upon cooperation and collaboration.”

Said Karp, “The state of our economy makes this is a crucial and opportune time for franchisee associations to establish their viability and influence.  The AAFD Conference is designed to help associations seize the moment and achieve an influential and constructive role within their respective franchise systems.”

Drewelow added, “It is our further goal to help franchisees and franchisee associations to weather our difficult economy—as Eric has observed, this is a time of great challenges, but also enormous opportunities.  It is crucial for franchisee associations to be at the ‘top of their game’ to support their constituents in this stressful time.”

AAFD 17th Annual Conference

Starbucks Lawsuit May be Class-action

Melissa Allison a Seattle Times business reporter writes the lawsuit of a Starbucks store manager in Florida who claims the company violated federal law by not paying overtime was granted conditional class-action status this week by a U.S. District Court judge in Broward County.

The lawsuit, filed in January by Starbucks employee Ronald Reed, seeks to represent people who worked as Starbucks store managers from Jan. 15, 2006, to the present. His lawyers have until May 11 to give the court the names and addresses of those people.

A similar Florida lawsuit, covering an earlier time period, was settled last summer for an undisclosed amount. That case, which 900 plaintiffs had joined, also was conditionally certified as a class action.

Starbucks has faced several other compensation lawsuits in recent years.

Last year, a California court ordered the coffee chain to pay an estimated $100 million in tips and interest to baristas who were required to share tips with shift supervisors, who also do barista duties but have some managerial responsibilities. Starbucks is appealing that decision.

The company agreed last year to pay up to $3 million to settle a California lawsuit that alleged it did not reimburse employees for mileage expenses incurred on the job.

Also last year, Starbucks settled an overtime wage case in Houston. It paid an undisclosed amount to about 350 assistant managers who alleged they were forced to work off the clock.

Starbucks declined to comment on this week’s court decision in Florida.

Seattle Times

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