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Board issues related employer declaration for franchisor and franchisee due to franchisor's real economic control.
The Ontario Labour Relations Board considered applications arising from the franchising of former Dominion stores to Mr. Grocer franchisees.
The union sought a related employer declaration under s. 1(4) of the Labour Relations Act, arguing that Dominion, its subsidiary Willett Foods, and the franchisee Penmarkay Foods were under common control and direction.
Penmarkay sought to terminate the union's bargaining rights under s. 63(5), claiming a substantial change in the business.
The Board dismissed the s. 63(5) application, finding no fundamental change in the work performed.
The Board granted the s. 1(4) declaration, finding that Willett exercised real economic control over Penmarkay through the franchise agreement, which dictated margins, rent, and other costs, effectively controlling labour relations.
The declaration preserved the consolidated bargaining structure.
