H.R. 5267: American Franchise Act
Sponsor
Kevin Hern
Republican · OK-1
Bill Progress
Latest Action · Sep 10, 2025
Referred to the House Committee on Education and Workforce.
H.R. 5267 makes it harder to sue franchise brands
Why it matters
About 8,400,000 people work at franchise businesses, and the bill's findings cite roughly $825,000,000,000 in franchise output in 2022. H.R. 5267 would make it harder to treat a national brand as your employer unless it directly controls core job decisions.
H.R. 5267 draws a sharper line between the national brand and the local franchise owner. The bill says a franchisor counts as a joint employer only when it both has and uses substantial direct and immediate control over core job terms.
Those core job terms are limited to eight areas: wages, benefits, hours, hiring, firing, discipline, supervision, and direction. The bill also says that control has to matter on a regular or continuous basis—not just in a one-off, isolated, or minimal way.
Just as important, H.R. 5267 lists several things that usually would not count against the brand by themselves. That includes setting brand standards, operating hours, minimum staffing levels tied to service standards, minimum training requirements, and some safety or legal compliance rules.
The bill applies that same basic test in both labor disputes and wage-and-hour cases. If it became law, workers would generally have a tougher path to argue that the national brand—not just the local owner—was also their employer.
The bill would not reopen old cases. Proceedings already filed before enactment would stay under the current rules.
H.R. 5267 Bill Summary
What H.R. 5267 actually does.
Franchise brands face a narrower employer test
H.R. 5267 says a franchisor is a joint employer only if it possesses and exercises substantial direct and immediate control over at least one core job term. That raises the bar for treating the national brand as your employer.
Only eight job decisions count
The bill limits the analysis to eight areas: wages, benefits, hours, hiring, discharge, discipline, supervision, and direction. If the brand's influence falls outside those buckets, it would not count toward joint-employer status under this bill.
Occasional involvement usually won't be enough
Control must have a regular or continuous consequential effect on the job. The bill says sporadic, isolated, or de minimis involvement does not qualify.
Brand rules alone usually don't create liability
The bill says common franchisor practices—like setting brand standards, operating hours, minimum staffing tied to service standards, training requirements, and some safety or legal compliance rules—do not by themselves make the brand a joint employer.
The same rule would govern labor and wage cases
H.R. 5267 applies its franchise joint-employer standard under both federal labor law and federal wage-and-hour law. That means the same basic test would be used in union disputes and pay-related cases.
Existing cases keep the old rules
The bill is not retroactive. Lawsuits or agency proceedings already underway before enactment would continue under the current legal framework.
Who benefits from H.R. 5267?
National franchise brands with thousands of locations
Companies whose names are on storefronts across the country would get a clearer shield from being treated as the employer of workers hired by local franchisees. That matters in a sector the bill's findings say employed about 8,400,000 people in 2022.
Local franchise owners who run day-to-day operations
Independent owners would remain the main legal employer in more situations. If they control hiring, scheduling, pay, and discipline, the national brand is less likely to be pulled into the same dispute.
Franchise systems built around standardization
Brands that rely on uniform training, service rules, hours, and marketing standards would get more room to enforce consistency without that alone being treated as employer control.
Franchise businesses worried about litigation risk
Supporters argue clearer rules make expansion easier in a sector the bill's findings cite as generating about $825,000,000,000 in output in 2022. The practical benefit is less uncertainty over when the parent company can be sued as an employer.
Who is affected by H.R. 5267?
Workers at franchised restaurants, hotels, gyms, and retail stores
If you want to argue the national brand is also your employer, H.R. 5267 would make that harder. You would generally need to show direct, meaningful, ongoing control over pay, hours, hiring, firing, discipline, supervision, or direction.
Labor unions and worker advocates
Groups trying to bargain with or bring claims against franchisors would face a narrower legal test. The bill limits what kinds of brand involvement count and excludes minor or occasional control.
Federal agencies and courts
The National Labor Relations Board, the Department of Labor, and courts would have to apply the bill's more detailed franchise-specific standard instead of relying on broader interpretations.
Parties in future versus pending cases
New cases would use the new rule if H.R. 5267 became law, while proceedings already filed would stay under the old one. That could leave similar disputes operating under different standards depending on timing.
What Congress Is Saying
H.R. 5267 has come up 38 times in the Congressional Record so far.
H.R. 5267 also appeared in 1 more House floor reference and 37 routine cosponsor filings.
HR5267 Legislative Journey
House: Committee Action
Sep 10, 2025
Referred to the House Committee on Education and Workforce.
About the Sponsor
Kevin Hern
Republican, Oklahoma's 1st congressional district · 8 years in Congress
Committees: Ways and Means
View full profile →
Cosponsors (139)
This bill has 139 cosponsors: 16 Democrats, 123 Republicans, reflecting bipartisan support. Cosponsors represent 39 states: Alabama, Arkansas, Arizona, and 36 more.
Donald Davis
Democrat · NC
Beth Van Duyne
Republican · TX
Hillary Scholten
Democrat · MI
Chuck Edwards
Republican · NC
Jim Costa
Democrat · CA
Mark Alford
Republican · MO
Adam Gray
Democrat · CA
August Pfluger
Republican · TX
Henry Cuellar
Democrat · TX
Nathaniel Moran
Republican · TX
Ami Bera
Democrat · CA
Vicente Gonzalez
Democrat · TX
Cosponsor Coverage Map
Committee Sponsors
Education and Workforce Committee
17 of 36 committee members cosponsored
3 Republicans across this committee haven't cosponsored yet. Mobilize their constituents
H.R. 5267 Quick Facts
- Committee
- Education and Workforce
- Chamber
- House
- Policy
- Labor and Employment
- Introduced
- Sep 10, 2025
Referred to the House Committee on Education and Workforce.
Sep 10, 2025
Official Sources
Official bill page with text, sponsors, actions, and status for the American Franchise Act.
Wage and Hour Division guidance on employment relationships under the FLSA, relevant to the bill's wage-and-hour joint-employer provisions.
Official FTC franchise regulation cited in the bill text and analysis, defining franchise-related terms and disclosures.
Official U.S. Code text for the National Labor Relations Act provisions the bill would amend for labor disputes.
Official FLSA definitions section, relevant because the bill applies its franchise joint-employer rule to federal wage-and-hour law.
Official CBO page where any cost estimate for H.R. 5267 would appear if one is issued.
H.R. 5267 Common Questions
What does H.R. 5267 actually change?
It makes it harder to treat a national franchise brand as your employer. Under H.R. 5267, the brand usually counts only if it directly and meaningfully controls core job decisions like pay, hours, hiring, or discipline.
Does H.R. 5267 affect franchise workers?
Yes. The bill's findings cite about 8,400,000 workers at franchise businesses in 2022, roughly 5% of the U.S. workforce. The biggest change is who workers can try to hold legally responsible as an employer.
What job decisions count under H.R. 5267?
Only eight areas count: wages, benefits, hours, hiring, discharge, discipline, supervision, and direction. If the brand's influence falls outside those categories, it generally would not support joint-employer status.
Do brand standards make a franchisor your employer?
Usually no. H.R. 5267 says brand standards alone generally do not count as employer control. The same goes for things like operating hours, minimum staffing tied to service standards, and minimum training requirements.
Does occasional corporate involvement count?
Not usually. H.R. 5267 says the control has to have a regular or continuous consequential effect. Sporadic, isolated, or de minimis involvement would not be enough on its own.
Would H.R. 5267 apply to wage theft and union disputes?
Yes. The bill applies its franchise joint-employer rule in both federal labor law cases and federal wage-and-hour cases, so the same basic test would be used in both settings.
Does H.R. 5267 affect lawsuits already filed?
No. Cases and proceedings already started before enactment would keep using the current rules. H.R. 5267 applies only going forward.
Based on H.R. 5267 bill text
H.R. 5267 Bill Text
“To preserve the franchise business model.”
Source: U.S. Government Publishing Office
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