White House Backs American Franchise Act at IFA Summit

The Trump administration has publicly backed passage of the American Franchise Act, putting joint employer legislation in focus for the United States franchise community. Speaking at the International Franchise Association’s annual Advocacy Summit in Washington, D.C., a senior White House official urged Congress to act before the end of 2026, according to reports published on 23 and 24 September.

White House support adds political weight

FranchiseWire reported that a White House official underscored the administration’s support for the bill during the IFA gathering. A separate report by L’Express Franchise described the legislation as an administration priority for 2026 and said the official called for passage before year-end.

The proposal concerns when a franchisor can be treated as a joint employer of people working at a franchisee’s business. That distinction matters because it affects the circumstances in which a franchisor can face liability for employment practices at independently operated franchise locations.

For the franchise community, the immediate news is political support rather than a completed regulatory change. The reports describe legislation still moving through Congress, not a new standard already in force. White House backing therefore needs to be distinguished from enactment: the proposed changes remain conditional on the congressional process and presidential signature.

What the proposed standard would do

Introduced in September 2025 with support from seven Republicans and seven Democrats, the American Franchise Act would establish a single, franchise-specific joint employer standard under the Fair Labor Standards Act and the National Labor Relations Act.

According to FranchiseWire’s account, a franchisor would qualify as a joint employer only if it directly and substantially controlled the terms and conditions of a worker’s employment. The report identifies hiring, wages, hours and discipline among the matters covered by that test.

The legislation would also limit franchisors’ liability for employment law and regulatory violations occurring at franchise businesses. This is not the same as saying that every franchisor would automatically be free from liability. The reported proposal retains a test based on direct and substantial control, making the nature of the franchisor’s involvement central to the question.

A further stated aim is to put the definition into law rather than leave franchise relationships exposed to changes in the National Labor Relations Board’s approach under different administrations. Supporters present a permanent definition as a way to reduce recurring uncertainty over joint employer rules.

That aim should be understood as the intended effect of the bill. The research does not establish that the legislation has already changed any business’s legal position.

Where the bill stands in Congress

L’Express Franchise reported that the House Education and Workforce Committee cleared the bill on 22 July 2026 by 23 votes to 18. It also reported 142 House co-sponsors and a companion bill in the Senate.

Those details show that the proposal has attracted congressional support and passed a committee stage. They do not mean that it has completed passage through Congress. FranchiseWire’s 23 September report explicitly described the measure as pending in the House.

The distinction is important when interpreting the administration’s year-end appeal. A request for passage signals a preferred timetable, not a confirmed date on which a new standard will take effect. Neither report establishes a completed congressional vote on final passage or a presidential signing.

The combination of bipartisan sponsorship, committee approval and White House backing gives franchise businesses concrete developments to follow. However, the available reporting does not confirm the outcome of the remaining legislative process.

What franchise businesses should watch

For franchisors and franchisees, the central issue to monitor is the proposed direct-and-substantial-control test and whether it remains unchanged as the legislation progresses. The reported focus on hiring, wages, hours and discipline identifies the employment decisions at the heart of the proposal.

Businesses should also distinguish announcements of support from formal legislative milestones. Further congressional action, the final wording of any enacted measure and its implementation provisions would be more consequential for compliance decisions than an advocacy speech alone.

Practical takeaway: Treat the American Franchise Act as a live legislative proposal, not current law. Follow its progress and seek qualified employment-law advice before changing franchise support arrangements or employment practices in anticipation of passage.