Sends petition with over 5,000 signatures to President Biden urging him to protect America’s franchised businesses by signing bipartisan CRA resolution

WASHINGTON, D.C., April 10, 2024 – The International Franchise Association (IFA) today applauded U.S. Senate passage of the bipartisan Congressional Review Act (CRA) resolution, H.J. Res. 98, overturning the National Labor Relations Board’s (NLRB) expanded joint employer standard, which would fundamentally change the relationship between franchisor and franchisee. Following passage, IFA sent a petition with over 5,000 signatures from the franchise community to President Joe Biden urging him to sign the legislation.

“Today, Congress stood with hundreds of thousands of small businesses from around the country by rejecting this misguided joint employer rule,” said IFA President and CEO Matt Haller. “President Biden now must join the bipartisan effort to reject this proposal or he will be telling franchise businesses in every state that he doesn’t support them. President Biden can be both pro-union and pro-franchising, but not if he supports this joint employer rule. Franchising is the greatest avenue to owning your own small business, especially in underrepresented communities, but if the president rejects the bipartisan opposition to the rule, he will eliminate one of the best paths to wealth creation.”

The vote comes after a federal judge in Texas struck down the rule for exceeding the scope of its authority and violating the Administrative Procedure Act (APA) by failing to respond to comments regarding the rule’s harmful economic consequences. Passage of the CRA ensures further stability for the small business community.

The resolution, led by U.S. Sens. Joe Manchin (D-WV) and Bill Cassidy (R-LA), passed the Senate by bipartisan vote of 50-48, and now heads to the president’s desk for signature. Today’s Senate action follows bipartisan passage of H.J. Res. 98 in the House by a vote of 206-177 in January.

The petition was signed by over 5,300 individuals including small business owners, franchise brands, and other stakeholders concerned about the implications of the rule from all 50 states. The signers write, “Mr. President, we implore you to use your influence and authority to send the recently promulgated NLRB joint employer rule back to the drawing board by signing H.J. Res. 98 into law. We know the rule will cost small businesses gravely, and you can return the hope and confidence they need by affirming this legislation.”

In October 2023, the NLRB issued a final regulation expanding joint employment between franchisors and franchisees and redefining how brands and owners could be jointly responsible for the same employees. This change fundamentally upends the franchise business model. When a similar standard was promulgated in 2015, IFA estimates it cost franchised businesses over $33 billion per year, resulted in 376,000 lost job opportunities, and led to 93% more lawsuits.

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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 806,270 franchise establishments that support nearly 8.7 million direct jobs, $858.5 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 supplier companies that support the industry.