IFA is continuing its important work advocating for franchise businesses! This week, IFA filed comments to the Department of Labor (DOL) to support their efforts to get one step closer to a sensible and clear joint employer standard – one of the most complicated and costly policies harming franchise brands and business owners alike.

IFA argues that the DOL’s proposed rule correctly acknowledges that long-accepted business practices in franchising are not evidence of joint employment. IFA also encouraged the DOL to make clear that a franchise brand may be considered a joint employer of a franchise owner’s employees only if the two businesses share or together determine an employee’s essential terms of employment such as hiring, firing, discipline, and supervision.

In short, this means what everyone in franchising understands – that franchisee owners are the employers of their employees.

IFA’s regulatory comments can help the Department of Labor move forward with this rulemaking. IFA advocates have been pushing for it for more than a year – it was even one of the main topics of discussion for FAN advocates and their legislators at last year’s annual meeting!

And for good reason! Franchisees and franchisors alike report that an expanded joint employer standard – which this DOL rule seeks to undo – has increased costs, made it harder to work cooperatively, and limited training and support within the brand. IFA even found that the expanded joint employer policy under a similar law cost franchise business $33.3 billion per year, resulted in 376,000 lost job opportunities, and led to 93% more lawsuits.

This rulemaking is a positive step from the Department of Labor and the franchise community urges regulators and elected officials to move quickly to return to a narrow, clearly defined joint employer standard.