IFA Celebrates Senate Overturn of New Joint Employer Rule

IFA Celebrates Senate Overturn of New Joint Employer Rule

Pushback Led by IFA Helped Sway Lawmakers to Stifle NLRB Regulatory Change

The U.S. Senate passed the bipartisan Congressional Review Act resolution H.J. Res. 98, which overturns the National Labor Relations Board’s expansion of the joint employer standard. Without the Senate’s action, this rule would have made both franchisors and franchisees liable for labor law infractions. On Thursday, the International Franchise Association issued a statement thanking IFA members for answering the trade organization’s call to push back against the NLRB’s revised joint employer rule.

Certainly franchisors, franchisees, their suppliers, and other business entities involved in franchising are relieved that lawmakers acted to cancel the rule. Together these businesses represent a sizable chunk of the U.S. economy. In the 2024 Franchise Economic Outlook report, FRANdata — presenting research commissioned by the IFA — predicted that franchising’s total output (the dollar value of all goods and services) will be nearly $894 billion in 2024, a 4.1% increase from the $858.5 billion last year. The report also forecast that the number of franchise establishments will rise by 15,000-plus units this year (an increase of 1.9%) to about 821,000 franchise units in the United States.

Details of IFA Statement

In its statement about the Senate vote, IFA leadership said the following: “The passage of H.J. Res. 98 marks a significant milestone in our fight to protect the integrity of the franchise model and the livelihoods of hundreds of thousands of small businesses across the nation. With this resolution, Congress has reaffirmed its commitment to franchising and provided much-needed stability for our community. Immediately following passage [by the Senate], IFA sent a petition to the White House with over 5,300 signatures urging President Biden to sign the legislation and protect the hundreds of thousands of local businesses from the harm in store from this rule.” 

The IFA also thanked those who signed its petition, protested independently to the nation’s lawmakers, and engaged in additional advocacy to circumvent the rule. “Your dedication and perseverance have made all the difference,” the statement said. 

It continued by thanking Sens. Joe Manchin (D-West Virginia), Kirsten Sinema (I-Arizona), Angus King (I-Maine) and all Republicans who helped the joint resolution pass. Sen. Josh Hawley of Missouri was the lone Republican who voted against the measure.  

Webinar on What’s Next

The IFA also acknowledged that members may have questions about other franchise-related legislation and regulatory actions that are on the horizon. In anticipation of those questions, the IFA issued an invitation to its webinar “Joint Employer: Are Franchise Companies in the Clear?” The event will be held at 2 p.m. EDT on Tuesday, April 23. Concern about NLRB expansion of the joint employer rule has been brewing since at least September 2022, when the IFA alerted its members and called for action. The IFA and franchising specialists explained the significance of the rules change and kept association members apprised of the comment period, its lobbying efforts and other actions related to the NLRB’s actions relating to the change.

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Mary Vinnedge is an award-winning journalist who has served as editor in chief, managing editor and senior editor at national and regional publications, including SUCCESS and Design NJ magazines. She also held reporting and editing roles at The Dallas Morning News and Charlotte Observer newspapers.

Before Mary began covering franchise news and trends as a staff writer for FranchiseWire and Franchise Consultant Magazine, she developed articles on topics ranging from lifestyle, education, health and science to home projects, horticulture, gardening, interior design and architecture. These articles included her reporting on academic news at her alma mater, Texas A&M University, when Mary worked in the marketing department of the Texas A&M Foundation. She continues to be a news junkie and subscribes to several publications.

Today Mary and her husband are empty nesters living on Galveston Island near Houston. The couple’s blended family – scattered around the United States – includes five children, four grandchildren and two very spoiled, very barky miniature schnauzer rescues.
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