Representative Kevin Hern (OK-01) has introduced the American Franchise Act (AFA), alongside Democrat co-lead Representative Don Davis (NC-01). The bill aims to provide stability for the franchise model of small business by aligning federal law with longstanding precedent and National Labor Relations Board (NLRB) policy.
“As one of the few franchisees in Congress, I understand how damaging an ever-changing joint-employer rule is to the franchise business model,” said Rep. Hern. “I’m pleased that we were able to come together in a bipartisan effort to create legislation that safeguards small businesses and individuals working to achieve the American Dream across the country.”
The International Franchise Association supports the legislation. Matt Haller, IFA President and CEO, stated, “This legislation recognizes that franchisees are small businesses, and their independence must be protected by federal law. The American Franchise Act allows franchisors to properly support their franchisees – who are often first-time business owners from all walks of life – without the fear of an overly broad joint employer standard undermining the unique benefits of the franchise relationship. On behalf of America’s 831,000 franchise small businesses, we are grateful that the decade-long uncertainty around joint employer policy can finally come to an end.”
Changes in ‘joint employer’ rules have previously created challenges for franchise business owners, leading to lost job opportunities and increased litigation costs. The proposed act would clarify that franchisors are considered “joint employers” only if they have substantial and immediate control over essential employment terms such as hiring, firing, setting wages, and disciplinary actions.
The AFA also acknowledges that while franchisors set standards for brand consistency, both franchisors and franchisees remain independent employers.
Kevin Hern has served in Congress representing Oklahoma’s 1st District since 2018 https://hern.house.gov/. He was born in Belton, Missouri in 1961 and currently resides in Tulsa. Hern graduated from Arkansas Tech University with a BS in 1986 and from the University of Arkansas at Little Rock in 1999.
