American Franchise Act Faces Year-End Push in Congress

US franchise advocates are urging Congress to pass the American Franchise Act before the current legislative session ends, putting joint-employer rules back at the centre of the franchise community’s policy agenda. Speaking at the Restaurant Finance and Development Conference in Las Vegas, association representatives said the weeks following the November 2026 elections offer a critical opportunity to secure legislation.

Why advocates are pressing for action now

Jeff Hanscom, senior vice president of state and local government relations at the International Franchise Association (IFA), called for immediate action during a panel with Mike Whatley of the National Restaurant Association. Their discussion followed Democratic victories that delivered majorities in both chambers of Congress and control of several state governments.

According to Franchise Times’ report on 10 November, Hanscom warned that the bill would expire if it did not pass during the remaining session of the current Congress. He urged franchise community members to increase pressure for passage before the change in congressional control.

Restaurant Dive reported that Hanscom identified the period leading up to the federal funding deadline, approximately 11 December, as the main window for legislative action. That is an assessment of the political timetable, rather than a guarantee that the bill will receive a vote.

The IFA is presenting the proposal as a way to give businesses greater certainty. Hanscom also stressed that franchising is a bipartisan business model and that the associations work with both parties.

What the American Franchise Act would change

The legislation addresses when a franchisor can be treated as a joint employer of a franchisee’s workers. That distinction concerns responsibility for violations of the National Labor Relations Act and the Fair Labor Standards Act.

Under the proposed wording reported by Franchise Times, a franchisor could be considered a joint employer only where it possesses and exercises substantial direct and immediate control over one or more essential terms or conditions of its franchisee’s employees’ employment.

The proposal applies specifically to franchise relationships. Its language is consistent with the National Labor Relations Board’s 2020 standard, according to the publication.

Joint-employer policy has repeatedly changed with political control in Washington. Franchise Times reported that the standard has changed four times in the past decade. Supporters’ case for the legislation centres on replacing that uncertainty with a statutory rule for franchising.

The bill remains a proposal, not an enacted change. Franchisees and franchisors should therefore distinguish the campaign for passage from any alteration to their current legal obligations.

Where the legislation stands

Representative Kevin Hern, a Republican from Oklahoma, introduced the House bill in September 2025. A Senate companion followed in December, introduced by Republican Senator Roger Marshall of Kansas and Senator Angus King, the Maine independent who caucuses with Democrats.

In July 2026, the House Committee on Education and Workforce advanced the proposal by 18 votes to 15. Republicans supported it and Democrats opposed it in that committee vote.

As of 9 November, the House version had 158 cosponsors and the Senate version had 11, Restaurant Dive reported. Supporting organisations include the IFA, National Restaurant Association, Coalition of Franchisee Associations and American Association of Franchisees and Dealers.

Franchise Times also reported that White House staff told an IFA event in September that President Donald Trump would sign the bill if Congress passed it. That stated support does not remove the need for congressional approval.

State-level employment questions remain

The Las Vegas discussion also highlighted employment-related issues beyond the federal bill. Whatley said changes in political control could bring further debate over minimum wages, tip credits and other labour policies.

Both representatives raised concerns about New Jersey’s assessments on large employers with workers receiving Medicaid. Hanscom said their organisations were involved in litigation challenging the law, describing it as an assessment based on the employment relationship.

Those concerns were presented as a separate policy pressure, not as a confirmed consequence of the American Franchise Act. The discussion underlined that federal joint-employer legislation is only one part of the employment-policy picture facing US franchise businesses.

Practical takeaway: Franchisees and franchisors should monitor the bill’s congressional progress while reviewing applicable state requirements separately. Advocacy announcements and political deadlines should not be mistaken for changes already in force.