IFA Urges Missouri Legislature to Protect Franchised Businesses

By clarifying appropriate joint employer standard of “direct and immediate control,” Missouri HB 1068 protects franchisee independence and brand support at the state level

WASHINGTON, D.C. – Jeff Hanscom, Senior Vice President of State and Local Government Relations for the International Franchise Association (IFA), today urged Missouri legislators to advance HB 1068, which would clarify the appropriate definition of joint employer as “direct and immediate” control, a distinction critical to a successful relationship between franchisors and franchisees.

“After numerous attempts at the state and federal level to destroy franchising with an unworkable definition of joint employer, we commend Missouri legislators for stepping up and cementing the appropriate safeguards,” said Hanscom. “This legislation protects the independence of Missouri franchisees and their employees and ensures that brands can continue to provide the critical support that essential to the success of the franchise model. IFA has successfully championed similar legislation in 21 other states, and we are pleased that Missouri is taking this commonsense step to protect our business model and all who benefit from it.”

Sponsored by Rep. Matthew Overcast (R-155) and co-sponsored by Rep. Tonya Rush (D-67), HB 1068 advanced out of the House Economic Development Committee in a favorable 13-0 unanimous vote earlier this month. The bill now needs to advance from the House Rules Committee before heading to the full House chamber for a vote.

“HB 1068 serves as a crucial safeguard for Missouri’s franchised businesses and is a commonsense solution,” Overcast said. “By establishing clear joint employer standards, this legislation creates an environment conducive to growth and stability, enabling franchisees to flourish and play a significant role in our state’s economic health. This important step brings us closer to our goal of transforming the Show-Me State into the Grow-Mo State, where businesses can thrive, and communities can prosper.”

The legislation comes as franchised businesses have had to navigate four different joint employer standards on the federal level over the last decade. In 2015, when the Obama administration expanded the definition of joint employer, it cost franchised businesses $33.3 billion per year, resulted in 376,000 lost job opportunities, and led to 93% more lawsuits. Codifying the appropriate joint employer standard will ensure brands are able to provide support to their franchisees while franchisees remain independent business owners.

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About the International Franchise Association:

Celebrating over 60 years of excellence, education, and advocacy, the International Franchise Association (IFA) 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 approximately 831,000 franchise establishments that support nearly 8.8 million direct jobs, $896.9 billion of economic output for the U.S. economy, and almost 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.