WASHINGTON – The International Franchise Association (IFA) announces its support for the Employee Rights Act (ERA) of 2023, introduced today by U.S. Sen. Tim Scott (R-SC) and U.S. Rep. Rick Allen (R-GA) with support from Senate Republican Leader Mitch McConnell (R-KY). Among other key provisions, the Act will clarify the joint employer standard and protect American workers’ freedom of choice in the workplace.

“The Employee Rights Act makes it clear that franchisees are independent business owners,” said Michael Layman, IFA Senior Vice President of Government Relations and Public Affairs. “As small businesses owners across the country, many of whom are local franchise owners, navigate inflation and a post-COVID economy, the Employee Rights Act is needed now more than ever. The franchise business model is responsible for 8.7 million jobs and $860.1 billion in economic output for the U.S. economy – it must be protected.” 

The ERA package includes the Save Local Business Act sponsored by Sen. Roger Marshall (R-KS) and Rep. James Comer (R-KY), which clarifies the joint employer standard to ensure franchise owners can retain their hard-earned equity and will not face the threat of becoming employees of their brand. This additional certainty for small business owners and workers will allow give more Americans the opportunity to realize the dream of business ownership through franchising. The bill package also includes the Protections for Socially Good Activities Act originally introduced in the 117th Congress by Sen. Mike Braun (R-IN) and the late Rep. Jackie Walorski (R-IN).

Earlier this month, IFA joined 33 organizations on a letter supporting the Employee Rights Act of 2023 saying, “As technology advances and more industries seek to navigate a post-pandemic economy, it is common sense that our labor laws – which haven’t been meaningfully updated in decades – adapt to today’s diverse economy and provide the best protection possible for America’s workers.” Read the full letter here.

IFA’s 2023 Franchising Economic Outlook, shows that even with a tough macroeconomic outlook, the franchise business model continues to provide an accessible pathway to business ownership for people and communities around the country. Legislation such as the ERA will continue to support its growth. The findings include:

  • Franchising will add approximately 254,000 jobs in 2023 and total franchise employment is forecasted to reach 8.7 million.
  • The overall number of franchise establishments will increase by almost 15,000 units in 2023 to 805,000 units in the U.S.
  • Franchises’ GDP share of the overall economy is 3% this year.
  • Service-based industries and quick-service restaurants will witness higher growth than other industries.

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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 790,492 franchise establishments that support nearly 8.4 million direct jobs, $825.4 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.

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