No. The American Franchise Act (AFA) would not make franchisors immune from a joint employer finding. It recognizes that certain levels of franchisor engagement are beneficial and necessary for the franchise system, while local franchise owners run their businesses and manage their employees.

• Preserves accountability: A franchisor may still be held jointly liable when it actually determines essential terms and conditions of employment of a franchisee’s employees, like wage rates, benefits provided, work schedules or disciplinary action for a franchisee’s employees. The bill sets out, term by term, what counts as that kind of control and what does not, so the line is drawn in statute rather than left to shifting agency interpretation.

• Protects franchisee independence: Franchisees operate independently, hiring their teams and running their businesses day to day. Day-to-day management of employees remains the sole prerogative of the independent franchisee.

• Clarifies brand standards and support: Setting minimum standards for brand protection, including protection of the franchisor’s trademarks and intellectual property, and offering training materials or other operations resources do not amount to direct and immediate control.

• Source: https://savelocalbusinesses.com/wp-content/uploads/2026/07/CSLB-AFA-Myth-vs-Fact.pdf
• Source: https://www.franchise.org/advocacy/american-franchise-act/