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April 29, 2025

IFA Improves Vermont Franchise Bill

Vermont lawmakers passed into law H.733 in a significantly scaled-back form after removing sweeping franchise relationship provisions following IFA and member engagement. The final bill requires franchisors and franchisees to disclose their status in filings with the Secretary of State, creating a basic tracking system.

Why It Matters: The changes avoided imposing vague, burdensome regulations that were not aligned with other states’ laws. Instead, the law focuses on data collection without altering franchise relationship standards.

What’s Next: The law takes effect January 1, 2027, with rulemaking to follow. IFA submitted a letter to the Secretary of State requesting clarity on implementation and will keep members informed.

California Employer Medicaid Bill Advances

What Happened: California lawmakers continue advancing AB 2729, with the Assembly Committee on Health voting 11–3 in favor of the bill. The measure has now been re-referred to the Assembly Committee on Appropriations.

Why It Matters: The bill would shift Medicaid costs onto employers through new penalties, raising concerns about the potential impact on franchisees and increased joint employer liability exposure. Key provisions could ultimately be folded into broader state budget negotiations later this year, which may accelerate the bill’s path forward.

IFA’s Perspective: IFA joined a coalition letter spearheaded by the California Chamber of Commerce (CalChamber) opposing the bill, arguing it unfairly targets employers and risks expanding joint employer exposure. IFA will remain engaged as the legislative process unfolds.

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CA Franchise Broker Fix Clears Committee 

California lawmakers are advancing AB 2795 to correct technical fixes in SB 919, the IFA-backed 2024 law requiring franchise brokers to register and provide disclosures. The bill passed the Assembly Banking & Finance Committee unanimously. 

Why It Matters: The fixes are intended to clarify statutory language and ensure regulators can implement the broker registration framework in an efficient and cost-effective manner without altering the original policy.

What’s Next: AB 2795 now heads to the Assembly Appropriations Committee as IFA continues working with regulators and lawmakers to support timely implementation.

U.S. House Privacy Bill Introduced

A federal data privacy bill, H.R. 8413, has been introduced in the U.S. House by Energy and Commerce Committee Vice Chairman Rep. John Joyce, M.D. Committee staff briefed industry stakeholders on the proposal, noting that several revisions are expected based on feedback provided after an earlier draft.

Why It Matters: The bill would create a single national privacy standard, replacing the current patchwork of state laws. Lawmakers emphasized the importance of unified industry advocacy—particularly from Main Street businesses—to help advance the legislation and maintain momentum.

What’s Next: The Energy and Commerce Committee is expected to hold a Subcommittee hearing on the proposal in May.

Labor Discharge Petition Gains Support

Members of Congress are signing a petition to force consideration of the IFA-opposed Faster Labor Contracts Act (FLCA) (H.R. 5408/S. 844), with 91 House members now signed on, including one Republican, Rep. Mike Lawler (R-NY).

Why It Matters: The FLCA would establish stricter timelines for reaching first union contracts, increasing pressure on employers during negotiations. The growing number of signatures signals continued momentum among supporters seeking to bypass committee consideration.

What’s Next: If the petition reaches 218 signatures, the bill would be brought before the House for a full House vote.

IFA Comments on Independent Contractor Rule

What Happened: This week, IFA submitted formal comments to the U.S. Department of Labor (DOL) rulemaking on independent contractor status under the Fair Labor Standards Act and Family and Medical Leave Act, while requesting targeted modifications to better protect the franchise business model.

Why It Matters: IFA is pleased that the proposed rule's economic realities framework—grounded in decades of Supreme Court precedent—would bring much-needed clarity and predictability to worker classification standards that directly affect franchising's 830,000+ establishments and 8.8 million jobs, and it would replace the confusing 2024 Rule that created unnecessary litigation risk for franchisors and franchisees alike.

What's Next: IFA is urging DOL to finalize the rule with franchise-specific guidance, including explicit language confirming that brand standards and legal compliance requirements do not constitute employer control, and that the franchisor-franchisee relationship reflects an independent contractor arrangement—not an employment relationship.