American Franchise Act | ChamberLight

IN COMMITTEE· 119TH CONGRESS

Senate BillS 3525Labor standardsEmployee benefits and pensions

American Franchise Act

INTRO DEC 17· LAST ACTION MAR 19

READING

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LEGISLATIVE PROGRESS

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In Committee

Reported

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Passed House

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Became Law

WHAT THE BILL DOES

AI-written

This bill matters because it directly addresses a long-standing debate about who is truly responsible for workers at franchise locations. If this bill passes, it would create a clear legal line that largely separates franchisors from being considered employers of their franchisees' workers. This could mean that if a local franchise owner violates labor laws, only that owner, not the national brand, would be held accountable, unless the national brand was *directly* dictating specific wages, hiring decisions, or firing actions.

For voters, this bill could impact the stability and growth of the franchise model, which accounts for millions of jobs and billions in economic output. Supporters believe it preserves the independence of local business owners and reduces legal burdens on large corporations, potentially encouraging more franchising and economic activity. Opponents, however, might argue that it could reduce accountability for large corporations regarding labor standards across their brand, potentially impacting workers' ability to seek redress from a larger, more financially capable entity in cases of systemic labor issues.

KEY PROVISIONS

3AI-extracted

PROVISION 01

Amends the National Labor Relations Act to specifically define when a franchisor can be considered a "joint employer" of a franchisee's employees.

This provision creates a new legal standard for joint employment in the franchise context, making it much harder to establish.

PROVISION 02

Specifies that "direct and immediate control" over essential terms like wages, hiring, and firing is required for joint employer status.

This narrowly defines the threshold for responsibility, excluding many typical franchisor activities like setting brand standards.

PROVISION 03

Lists specific franchisor actions, such as setting operating hours or offering training materials, that do *not* constitute "direct and immediate control."

This clarifies which common franchisor practices are protected from triggering joint employer liability.

SPONSORSHIP

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COSPONSOR BREAKDOWNBIPARTISAN · 0%

DEM 0 REP 3 IND 1

ACTION TIMELINE

3 EVENTS

MAR 19

Committee on Health, Education, Labor, and Pensions. Hearings held.

COMMITTEE

DEC 17

Introduced in Senate

INTROREFERRAL

DEC 17

Read twice and referred to the Committee on Health, Education, Labor, and Pensions.

INTROREFERRAL

BILL INFO

TypeSenate Bill

NumberS 3525

Congress119th

StatusIn Committee

IntroducedDec 17, 2025

Last actionMar 19, 2026

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IN COMMITTEE· 119TH CONGRESS · HEALTH, EDUCATION, LABOR, AND PENSIONS COMMITTEE · INTRODUCED DEC 17, 2025

Senate BillS 3525Labor standardsEmployee benefits and pensions

American Franchise Act

INTRODUCED DEC 17, 2025· LAST ACTION MAR 19, 2026

PASSAGE CHANCES

—%

READING

7 min

COSPONSORS

COMPLEXITY

Moderate

Call my reps

LEGISLATIVE PROGRESS

STEP 2 OF 8

Introduced

In Committee

Reported

Passed Senate

Passed House

Conference

To President

Became Law

Introduced
In Committee
Reported
Passed Senate
Passed House
Conference
To President
Became Law

WHAT THE BILL DOES

AI-written

KEY PROVISIONS

AI-extracted

high

Amends the National Labor Relations Act to specifically define when a franchisor can be considered a "joint employer" of a franchisee's employees.

This provision creates a new legal standard for joint employment in the franchise context, making it much harder to establish.

high

Specifies that "direct and immediate control" over essential terms like wages, hiring, and firing is required for joint employer status.

This narrowly defines the threshold for responsibility, excluding many typical franchisor activities like setting brand standards.

med

Lists specific franchisor actions, such as setting operating hours or offering training materials, that do *not* constitute "direct and immediate control."

This clarifies which common franchisor practices are protected from triggering joint employer liability.

GLOSSARY

AI-written

Franchise: A business arrangement where an independent local owner (franchisee) pays a fee to use a larger company's (franchisor's) brand name, business system, and marketing plan.
Franchisor: The larger company that owns the brand and licenses its business system, trademarks, and support to others.
Franchisee: The independent local business owner who operates a specific location or territory under a franchisor's brand and business model.
Joint Employer: A legal term meaning two or more businesses are both considered employers of the same group of workers and are therefore jointly responsible for their employment terms and conditions.
National Labor Relations Act: A foundational U.S. federal law that protects the rights of most private-sector employees to organize, form or join unions, and bargain collectively with their employers.
Direct and Immediate Control: The specific and active involvement in making decisions about employees' wages, work hours, hiring, firing, and daily tasks, as opposed to general guidance or standards.

ACTION TIMELINE

3 EVENTS

MAR 19

Committee on Health, Education, Labor, and Pensions. Hearings held.

COMMITTEE

DEC 17, 25

Introduced in Senate

INTROREFERRAL

DEC 17, 25

Read twice and referred to the Committee on Health, Education, Labor, and Pensions.

INTROREFERRAL

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Committee Referrals

Health, Education, Labor, and Pensions CommitteeReferred

Mar 19, 2026

senate

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Health, Education, Labor, and Pensions Committee (senate)Mar 19, 2026

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American Franchise Act

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