5 Key Actions Vice President Kamala Harris Could Take to Support the Franchise Community
As Vice President Kamala Harris continues her campaign trail, the franchise community is eager to understand how her policies might impact their sector. Both the CEO of the International Franchise Association (IFA) and the world’s largest franchise operator have outlined five crucial steps Harris could take to support the franchise industry, enhancing opportunities for small business owners and their employees.
1. Champion Franchising as a Key Component of the Opportunity Agenda
Vice President Harris should actively promote franchising by visiting franchise locations and engaging with their employees across swing states and beyond. By spotlighting the benefits of franchising, she can highlight its role in providing economic opportunities and high-quality jobs. Franchises employ nearly nine million workers and are known for offering competitive wages and benefits. Additionally, franchise owners are notably diverse, making franchising a model that aligns with Harris’s commitment to expanding economic opportunities for all.
2. Reject the Expanded Joint Employer Rule
One of Harris’s priorities should be to abandon the proposed expansion of the joint employer rule, a move that could severely disrupt the franchise model. The current rule, which has been rejected by bipartisan majorities and various state legislatures, aims to hold franchisors liable for their franchisees’ employment practices. To protect small businesses, Harris should support a regulatory environment that respects franchisee autonomy while ensuring fair labor standards.
3. Advocate for Pro-Small Business Tax Policies
Harris can bolster the franchise community by endorsing pro-small business tax reforms. Key provisions of the Tax Cuts & Jobs Act (TCJA), such as the Qualified Business Income Deduction (QBID) and interest deductibility standards, have expired or are set to expire soon. By advocating for their extension and supporting the Tax Relief for American Families and Workers Act, Harris would help franchise owners gain a competitive edge and manage their tax burdens effectively. This support would demonstrate her commitment to small business prosperity and economic growth.
4. Increase SBA Lending Limits and Access to Capital
To address the capital access challenges faced by franchisees, Harris should support increasing lending limits at the Small Business Administration (SBA) and expand the 7(a) Working Capital Pilot (WCP) program. The WCP, introduced earlier this year, offers flexible credit lines designed to meet diverse business needs. Enhancing these lending options would assist franchisees in navigating high-interest rate environments and foster greater entrepreneurial activity.
5. Modernize the Federal Trade Commission’s Franchise Rule
Finally, Harris should advocate for an updated Franchise Rule through the Federal Trade Commission (FTC). The current rule, last revised in 2007, governs the sale of franchises and is due for modernization. Updated regulations would streamline the Franchise Disclosure Document (FDD) process, making it more comprehensible and accessible for prospective franchisees. Modernizing the Franchise Rule would better protect consumers and support the growth of the franchise sector, aligning with Harris’s goals of fostering small business development and consumer protection.
By taking these actions, Vice President Kamala Harris can demonstrate a strong commitment to supporting the franchise industry and its significant contributions to the American economy. The IFA and franchise leaders are eager to collaborate with any administration to advance these goals and enhance the opportunities for franchisees across the nation.