Welcome to The Policy Brief
From labor regulations and franchise law to taxes, immigration, development policy and government action, decisions made in Washington and state capitals often have a direct impact on hotel owners and operators. Yet the implications of those decisions can be difficult to navigate amid the day-to-day demands of running a hospitality business. In this new column, Matt Campbell, chief operating officer of My Place Hotels of America, examines the legislative, regulatory and legal issues shaping the hospitality industry. Drawing on his experience as both a brand executive and industry advocate, Campbell will provide an operator's perspective on the policies affecting hotel businesses across the country.
Let's start by discounting me. I run operations for a hotel brand with nearly 100 properties throughout the United States. When I tell you I support the American Franchise Act, you should hold that at arm's length. A franchisor executive arguing for a bill that limits franchisor liability is a bit like a coach lobbying the sports league to change a rule his own team keeps getting called for. You should be skeptical.
So discount it. Then keep reading, because the reason I support this bill has almost nothing to do with what it protects me from.
Where Things Stand
H.R. 5267, known as the “American Franchise Act”, cleared the House Education and Workforce Committee on July 21, 2026, and now moves to the House floor. The legislation was originally introduced in September 2025 by Rep. Kevin Hern, R-Oklahoma. In the time since, the bill has roughly 140 bipartisan cosponsors. This is not a party-line fight.
This bill does something narrow, but important. It defines when a franchisor also becomes a joint employer of a franchisee’s employees. That will happen only where the franchisor possesses and exercises substantial direct and immediate control over essential terms and conditions of employment. What counts is the actual control over one or more things that define the fundamentals of a job: Setting wages, hours and benefits, and making the hiring and firing decisions. Brand standards, training materials and operational support don't count.
Liability Doesn't Reduce Control—It Redirects It
Critics worry that the bill lets franchisors keep control while removing accountability. It's a fair worry, so let’s follow it through. When joint-employer exposure grows, the incentives don't push a franchisor to keep helping. They push franchisors towards three responses, and a franchisee should not like any of them.
Response one is to pull back. The scheduling guidance, the operational best practices, the templates, and the actual training the franchisees find supportive will quietly go away. Franchisors will bring everything through counsel first. Counsel will most certainly say no more often than yes when franchisees seek assistance.
Response two goes the opposite way, and it is the one that should worry hotel operators. A company that will be held liable as an employer will be advised by its attorneys to behave like one. A brand cannot defend what happens in an operation it doesn't run, so the pull is toward more oversight, not less. A standard meant to loosen the franchisor's grip ends up tightening it.
Response three is to leave franchising. Brands can pivot toward company-owned and company-managed units, where the exposure at least equals the authority.
The entrepreneurial hotel owner loses under all three responses. The first leaves them alone. The second leaves them supervised. The third cuts it all out.
That's the part of this debate that nobody likes to say out loud. Broad joint-employer liability is generally sold as a check on franchisor power. It pushes franchisors toward two outcomes franchisees should want no part of which is less help and more supervision.
And under an indirect-control standard, the problem simply gets bigger. Every party lawyers up, every agreement gets rewritten with indemnity language, and the cost lands on the single property owner without in-house counsel who just wanted to know whether the franchisor had an onboarding checklist.
This Is Not Immunity
I love a good game of Monopoly, but this bill does not hand franchisors a Get out of Jail Free card. A franchisor that actually exercises substantial direct and immediate control over essential terms and conditions of employment is still a joint employer, full stop.
What the bill removes is liability based on control a franchisor could potentially exercise but chooses not to.
Independence
This is what the bill is really about. And in the year we celebrate America’s 250 years of independence, that word deserves some weight.
Franchisees are independent business owners who employ nearly 5 percent of all workers in the United States. Not a regional supervisor. Not a unit in someone else's system. A person who put their own money at risk, signed their own loan, hired their own ops team and answers for their own results. This is the entire premise of franchising.
But independence only works if both sides know the line. When the joint-employer standard is left undefined, a franchisor can be pulled into liability for employees it does not pay, schedule or supervise. The franchisor has no safe way to treat the franchisee as independent. It either pulls back and offers less, or takes over more. Either way, the operator's independence goes away.
Defining when a franchisor is a joint employer is not a favor to franchisors. It is what makes it possible to leave the franchisee alone to run their business. A clear line is what lets an operator stay an operator.
The views expressed are the author's own and do not represent My Place Hotels of America.