IFA and AAHOA Applaud Georgia Law Protecting Franchise Owners from Government Overreach

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Matthew Haller, 202-662-0770

Jenna Weisbord, 202-662-0766

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IFA and AAHOA Applaud Georgia Law Protecting Franchise Owners from Government Overreach

WASHINGTON, May 3—The International Franchise Association, the world’s largest organization representing franchise owners, and the Asian American Hotel Owners Association today applauded Georgia for the passage of Senate Bill 277, a new law affirming that franchisors and franchisees are separate entities and clarifying that a franchisor is not the employer of a franchisee or of a franchisee’s employees The Gov. signed the legislation into law this week.

The IFA and AAHOA worked together in supporting the Georgia statue, which applies to state enforcement agencies. SB 277, which excludes a franchisor as the employer of a franchisee or of an employee of a franchisee for purposes of certain laws relating to employment, was signed in the wake of a decision by the National Labor Relations Board (NLRB) to change 50 years of federal labor law and legal precedent.

“Georgia has taken a critically important step to protect local, franchise business owners and their employees and ensure franchising continues to create millions of jobs across the country,” said IFA President & CEO Robert Cresanti. “While the new federal joint employer standard threatens the future viability of the franchise model, we applaud state legislatures like Georgia for enacting laws that make clear that franchisees are responsible for their employees.”

IFA and AAHOA have worked to educate lawmakers in Washington, D.C. and state capitals around the country about the profound, long-term impact of joint employer on franchising. These efforts have yielded significant dividends to make the regulatory landscape more secure for franchise businesses. Georgia joins nearly a dozen other states that have already passed similar legislation or are considering actions to protect franchises against federal government overreach.

“The franchise system has given my family the opportunity to own and operate our own small business and providing our community with family-supporting jobs,” said Manish Jariwala, an owner of a Country Inn & Suites in Norcross, Georgia. “With this bill, Georgia is sending a clear message that small businesses of all types—and the jobs they create—are valued in this state.”

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About the International Franchise Association

Celebrating 56 years of excellence, education and advocacy, the International Franchise Association is the world’s oldest and largest organization representing franchising worldwide. IFA works through its government relations and public policy, media relations and educational programs to protect, enhance and promote franchising and the more than 800,000 franchise establishments that support nearly 9.1 million direct jobs, $994 billion of economic output for the U.S. economy and 3 percent of the Gross Domestic Product (GDP). IFA members include franchise companies in over 300 different business format categories, individual franchisees and companies that support the industry in marketing, law, technology and business development.