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IFA Spearheads Joint Employer Safe Harbor for Franchise Businesses in Final Rule Implementation

WASHINGTON, June 19—The International Franchise Association (IFA), the oldest and largest organization representing the franchise industry, today praised the Department of Labor for issuing its final rule regarding Association Health Plans (AHPs).

The rule expands the definition of “employer” to allow for increased access to Association Health Plans and also includes a “safe harbor” from new potential joint-employer liability as a result of participating in a plan. Under the new rule, small business owners will be able to join together to buy health insurance.

“Today is a great day for America’s franchise job creators and their employees in the fight for high quality, less expensive health coverage,” said IFA President & CEO Robert Cresanti. “We applaud the Department of Labor and the Administration for paving the way for franchise businesses to utilize AHPs and make the delivery of products and services more affordable for small business owners, employees, and their customers.”

“This announcement is also an acknowledgment the Department of Labor recognizes the importance of providing clear rules for employers on joint employment. We applaud Secretary Acosta for creating certainty for franchise owners when providing their employees with quality, affordable health insurance,” continued Cresanti. “We look forward to working with the Department of Labor and the Administration to implement this important new policy.”

The Department of Labor’s final rule ensures franchises can form AHPs at an accelerated rate and sets an important precedent by excepting these plans from ongoing joint employer uncertainty. In March, IFA submitted comments to the Department of Labor for a “safe harbor” from any new joint-employer liability as a result of participating in a plan. The request was echoed by bipartisan members of Congress, including Reps. Bradley Byrne (R-Ala.), Henry Cuellar (D-Texas), Paul Mitchell (R-Mich.), Sam Johnson (R-Texas), and Tim Walberg (R-Mich.).

IFA has long supported association health plans, arguing that it would increase small business owners’ ability to provide affordable health insurance for their employees. Franchise leaders joined President Trump in October for the signing of the executive order on Association Health Plans.