Sponsors (107)
The bill gives franchisors and franchisees clearer, narrower joint-employer rules that reduce litigation risk and help preserve franchise business models and jobs, but it also weakens workers' ability to hold franchisors accountable for pay and safety, potentially shifting costs and enforcement burdens onto franchisees and taxpayers.
Small-business owners and franchisors gain clearer legal standards narrowing when a franchisor is a joint employer, reducing litigation uncertainty and the risk of retroactive joint-employer liability.
Franchise owners retain operational autonomy for routine brand standards, training, scheduling, and other arm's-length activities, helping preserve franchise business models and local service availability.
Protecting franchising models helps preserve jobs and brand value—supporting employment for millions of franchise workers and helping keep prices and services stable in local communities.
Franchise workers lose power to hold franchisors accountable because the bill raises the threshold (to substantial direct and immediate control) for finding a franchisor a joint employer, narrowing situations where franchisors can be liable for workplace conditions.
Employees may lose access to remedies (unpaid wages, benefits, bargaining remedies) from franchisors when franchisors provide guidance or brand standards but do not directly set pay/hiring/discipline, leaving harmed workers with fewer recovery options.
If franchisors escape liability, enforcement costs and fallout from unpaid wages or inadequate benefits may shift onto taxpayers and public assistance programs when workers turn to social safety nets.
Based on analysis of 4 sections of legislative text.
Introduced September 10, 2025 by Kevin Hern · Last progress September 10, 2025
Sets a statutory, narrow test under federal labor law for when a franchisor can be treated as a "joint employer" of a franchisee’s employees. The law defines eight “essential terms and conditions of employment” (wages, benefits, hours, hiring, firing, discipline, supervision, direction), explains what counts as "direct and immediate" control over those terms, lists routine activities that do not qualify, and requires that a franchisor both possess and actually exercise substantial direct and immediate control before joint-employer liability applies. It applies to the National Labor Relations Act and does not change outcomes in proceedings that began before the law’s enactment.