Biden’s Immigration Reform Plan Has Major Implications For The Franchising Industry

After being inaugurated on Wednesday as the 46th president of the United States, Joe Biden quickly unveiled proposed legislation meant to reform the nation’s immigration system.

The U.S. Citizenship Act of 2021 is designed to create a path to U.S. citizenship for some of the nearly 11 million undocumented immigrants in the U.S.

With undocumented workers making up a large portion of the restaurant and hospitality workforce, and small business ownership a popular choice among immigrants, Biden’s immigration reform proposal could have major implications for the franchising industry.

What’s in the Bill?

The Citizenship Act, which is outlined in a four-page summary, proposes:

• Undocumented immigrants in the U.S. prior to January 1, 2021 would be able to apply for temporary legal status with the ability to apply for a green card after five years if they pass criminal and security background checks and pay taxes.
• Immigrants who were brought to the U.S. as children, certain immigrant farmworkers and those under protected legal status would be immediately eligible for green cards and could be eligible for citizenship after three years after passing background checks.

The bill would also carve out funding to expand English-language instruction and provide assistance to those wanting to become citizens. The bill prohibiting discrimination based on religion, offering funding for state and local immigrant and refugee support programs and eliminating some hurdles for work-related green cards.

Additionally, the bill calls for the Department of Homeland Security and the Department of Labor to create a commission to improve the employment verification process and to reform the family-based immigration system by clearing backlogs and reducing wait times.

What it Means for Franchisors and Small Businesses

According to the National Bureau of Economic Research, immigrants create about a quarter of all new businesses in the U.S. The restaurant industry, specifically, is considered to be the largest employer of immigrants in the U.S., with immigrants owning 29% of all restaurants and hotels. The National Restaurant Association has long been a vocal advocate for comprehensive immigration reform. 

“The restaurant industry today reflects the cultural traditions and hard work of immigrants who come to America seeking a better life," said Sean Kennedy, the National Restaurant Association’s EVP of public affairs, in a statement. “They add to the vast diversity that makes our smallest to largest restaurants cornerstones of their communities. The National Restaurant Association continues to support comprehensive immigration reform that expands opportunities for businesses seeking employees and immigrants pursuing the American Dream, and we applaud President Biden for making it a top priority."

The Small Business Majority founder and CEO John Arensmeyer praised Biden’s bill, noting in a statement Wednesday that immigrants are twice as likely to start small businesses and are responsible for creating one in 10 U.S. jobs. 

"We need leaders who recognize that immigrants are the lifeblood of American entrepreneurship — they work for small businesses, start small businesses and bolster our economic success," Arensmeyer said. "We are thrilled to see President Biden take immediate action today in delivering a comprehensive immigration reform proposal to Congress that will help bolster entrepreneurship and ensure small employers have access to a stable workforce.” 

With small business ownership being the driving force behind franchising, a bill that creates a clear path to U.S. citizenship could be a major boon for franchisors across the struggling restaurant industry and beyond. Plus, as the QSR industry grapples with labor shortages despite record unemployment, the reform proposal could also help those small business owners maintain and protect their staff.

“We are encouraged by President Biden’s urgency in protecting Dreamers and other immigrant entrepreneurs while ensuring small businesses are able to access both high and low-skilled employees, especially those who are providing essential services during the ongoing COVID-19 pandemic," said Arensmeyer.

Will The Bill Pass?

Although Democrats hold a tie-breaking majority in Congress, The Citizenship Act will likely receive some push back from the other side of the aisle. On Tuesday, Sen. Marco Rubio (R-Fla.) called the bill a “non-starter,” saying it offered “blanket amnesty for people who are here unlawfully.”

In addition to the new bill, Biden has already signed several immigration-related executive orders during his first day in office, including stopping work on the wall along the Mexican border, protecting DACA, voiding the Muslim travel ban and calling for all individuals in the country illegally to be included in the 2020 U.S. Census.