1851

The New Jersey Assembly has passed a new bill,&nbsp;<a href="https://www.njleg.state.nj.us/bill-search/2022/A1958?utm_source=1851franchise.com&utm_medium=article&utm_campaign=new-jersey-hospitality-bill-a-1958-passes-assembly-sparks-backlash-from-international-franchise-association-2722457" target="_blank" rel="nofollow">A-1958</a>, that could negatively affect hospitality franchises throughout the state, according to a statement released by the&nbsp;<a href="https://www.franchise.org/?utm_source=1851franchise.com&utm_medium=article&utm_campaign=new-jersey-hospitality-bill-a-1958-passes-assembly-sparks-backlash-from-international-franchise-association-2722457" target="_blank" rel="nofollow">International Franchise Association (IFA)</a>.&nbsp;The bill contains a list of hospitality franchisor activities that will be considered a violation of the “Franchise Practices Act”, outlining new restrictions on non-compete terms, relocation requirements, exclusive vendor partnerships, loyalty program points and more. The IFA notes that the bill is set to intrude on private franchise contracts, encourage litigation and lower brand standards, which are considered integral to the franchise business model. The IFA argues that the legislation constitutes government overreach and is counterproductive to the recovery of businesses still grappling with the aftermath of the COVID-19 pandemic.“Today New Jersey legislators voted against locally owned businesses in favor of government overreach, which will undoubtedly harm the state’s hospitality industry,” said&nbsp;<a href="https://www.franchise.org/our-team/staff/jeff-hanscom?utm_source=1851franchise.com&utm_medium=article&utm_campaign=new-jersey-hospitality-bill-a-1958-passes-assembly-sparks-backlash-from-international-franchise-association-2722457" target="_blank" rel="nofollow">Jeff Hanscom</a>, IFA Vice President of State Government Relations. “A-1958 undermines franchised businesses in the hospitality sector, making it more difficult to do business and serve their guests at a time when they are still trying to recover from the worst effects of the pandemic.”Hanscom also urged the Senate to stand with New Jersey businesses and oppose the legislation. The IFA had previously&nbsp;<a href="https://www.franchise.org/sites/default/files/2023-03/IFA%20comments%20NJ%20AB%201958%20ltr.pdf?utm_source=1851franchise.com&utm_medium=article&utm_campaign=new-jersey-hospitality-bill-a-1958-passes-assembly-sparks-backlash-from-international-franchise-association-2722457" target="_blank" rel="nofollow">sent a letter</a> in March to the New Jersey Assembly Commerce and Economic Development Committee, expressing their opposition to the bill.The legislation has also been criticized for potentially destabilizing the franchise business model entirely by hindering the enforcement of brand standards, the IFA notes.&nbsp;<a href="https://www.linkedin.com/in/tom-baber-14389011?utm_source=1851franchise.com&utm_medium=article&utm_campaign=new-jersey-hospitality-bill-a-1958-passes-assembly-sparks-backlash-from-international-franchise-association-2722457" target="_blank" rel="nofollow">Tom Baber</a>, a New Jersey-based franchisee for&nbsp;<a href="https://www.ihop.com/en/about-ihop/franchise-opportunities/usa/investment-costs?utm_source=1851franchise.com&utm_medium=article&utm_campaign=new-jersey-hospitality-bill-a-1958-passes-assembly-sparks-backlash-from-international-franchise-association-2722457" target="_blank" rel="nofollow">IHOP</a> and&nbsp;<a href="https://moneymailerfranchise.com/?utm_source=1851franchise.com&utm_medium=article&utm_campaign=new-jersey-hospitality-bill-a-1958-passes-assembly-sparks-backlash-from-international-franchise-association-2722457" target="_blank" rel="nofollow">Money Mailer</a>, expressed these concerns during a testimony on behalf of the IFA before the committee.&nbsp;&nbsp;“A-1958 has far-reaching and harmful ramifications for hospitality franchisors, franchisees, and the New Jersey economy,” Baber said. “But more than that, the legislation is a fundamental dismantling of the franchise business model by entirely removing any ability for franchise brands to enforce brand standards.”The potential impact of the legislation is significant, considering that there are currently 19,000 franchise establishments in New Jersey, which generate over $20 billion in economic output and employ more than 203,000 residents. The bill could negatively affect both existing hospitality franchises and the entire franchise model within the state, the IFA states, as well as any future expansion.&nbsp;The IFA has raised concerns that the legislation could also impede local businesses' contributions to the success of the 2026 World Cup, which is expected to receive substantial support from the franchise industry.Related articles<ul><li><a href="https://1851franchise.com/what-the-ftc-noncompete-proposal-could-mean-for-franchising-2720767#stories">What the FTC Noncompete Proposal Could Mean for Franchising</a></li><li><a href="https://1851franchise.com/senator-calls-for-ftc-sba-crackdown-on-franchising-2715484">Senator Calls For FTC, SBA Crackdown on Franchising</a></li><li><a href="https://1851franchise.com/why-ifa-says-the-proposed-independent-contractor-rule-could-spell-trouble-for-franchisees-2720642#industry">Why IFA Says the Proposed Independent Contractor Rule Could Spell Trouble for Franchisees</a></li><li><a href="https://1851franchise.com/ifa-and-thousands-of-franchisees-push-back-on-proposed-joint-employer-standard-2720586">IFA and Thousands of Franchisees Push Back on Proposed Joint Employer Standard</a></li><li><a href="https://1851franchise.com/restaurant-groups-send-petition-with-over-one-million-signatures-opposing-fast-act-in-california-2720567#industry">Restaurant Groups Send Petition with Over One Million Signatures Opposing Fast Act in California</a></li></ul>

New Jersey Hospitality Bill A-1958 Passes Assembly, Sparks Backlash from International Franchise Association

1851 Franchise

The controversial legislation could disrupt the franchise business model, affecting over 19,000 establishments and over 203,000 employees in New Jersey, according to the IFA.

new-jersey-hospitality-bill-a-1958-passes-assembly-sparks-backlash-from-international-franchise-association

Busy Bee Jumpers

Top 10 Reasons To Buy a Busy Bee Jumpers Franchise in 2025

top-10-reasons-to-buy-a-busy-bee-jumpers-franchise-in-2025

Home Halo

home-halo-former-athletes-frachisees-image

Why Former College Athletes Can Make Winning Home Halo Franchise Owners

former-college-athletes-home-halo-franchise

TruBlue Home Service Ally

TruBlue Featured in USA Today as Key Player in Helping Seniors Age Safely at Home

trublue-featured-in-usa-today-as-key-player-in-helping-seniors-age-safely-at-home

Right at Home

Right at Home Marks 30 Years With Continued Franchise Growth

Right at Home Marks 30 Years With Continued Franchise Growth, Tech Advancements, and Strong System Engagement in First Half of 2025

right-at-home-franchise-growth-2025

KidStrong Franchising, LLC

Unlocking Superpowers: How KidStrong Is Building the Next Generation of Confident Kids — and Thriving Franchise Owners

kidstrong-franchise-confident-kids

Buying a Franchise Masterclass

 Franchise Opportunities

Get Support Buying a Franchise

How to Buy a Franchise White Paper

How to Buy a Franchise

How to Sell Franchises

How to Grow a Franchise

Find a Franchise Supplier

1851 Franchise Opportunities

Franchisor News

Franchisor Power Rankings

FranCamp Mastermind Summit

Franchise Development Website Builder

Franchise Resources

What ALEC-Laffer's Report Means for Franchising

Website Awards

Power Rankings

About 1851

Advertise on 1851

Contact 1851 Editorial

Terms of Use

1851 Login

GROWTH CLUB LOGIN

facebook

instagram

twitter

linkedin

youtube

Photo of Roof Scientist truck and trailer

Roof Scientist Expands Into Northern Indianapolis as Entrepreneur Dale Speckman Launches New Business in Fishers

roof-scientist-expands-into-northern-indianapolis

Image of Donald Trump pointing with red stripes in the background

August 1 Tariff Deadline Is Said to Have ‘No Extensions’: What This Could Mean for Franchises

august-1-tariff-deadline-franchise-impact

What June’s Jobs Report Means for the Franchise Industry

what-junes-jobs-report-means-for-the-franchise-industry

Drone Delivery Takes Flight in QSR: The Future of Franchise Operations?

drone-delivery-takes-flight-in-qsr-the-future-of-franchise-operations

Chick-fil-A Tops Customer Satisfaction Rankings for 11th Year as Challenger Brands Gain Ground

chick-fil-a-tops-customer-satisfaction-rankings-for-11th-year-as-challenger-brands-gain-ground

Hooters Leans Into Franchising With Closure of 30 Company-Owned Stores - Agg - 1851 Franchise

Hooters Leans Into Franchising With Closure of 30 Company-Owned Stores

hooters-franchise-model-company-owned-closures

Technomic Releases Annual Ranking of the Top 15 Fast-Food Chains in the U.S.

technomic-releases-annual-ranking-of-the-top-15-fast-food-chains-in-the-us

Rising Jobless Claims Could Signal Challenges — and Opportunities — for Franchising

rising-jobless-claims-affect-franchising

From Prescriptions to Pastries: Kari Khandelwal Creates a Comforting Community Bakery 

From Prescriptions to Pastries: Kari Khandelwal Creates a Comforting Community Bakery in Overland Park, Kansas

paris-baguette-franchise-overland-park-khandelwal

Kansas Couple Revitalizes Local Childcare With Children’s Lighthouse

From Corporate Careers to Community Roots: Kansas Couple Revitalizes Local Childcare With Children’s Lighthouse

kansas-couple-opens-childrens-lighthouse-gardner-olathe

The Ultimate Guide to Selling Franchises: How To Create a Strong Incentive

how-to-build-strong-incentives-to-attract-prospective-franchisees

Franchisee spotlight graphic with photo of Ricki Oberoi and Layne's Chicken Fingers logo

Multi-Unit Wendy’s Operator Signs 12-Unit Deal With Layne’s Chicken Fingers

ricki-oberoi-laynes-chicken-fingers-growth

How Vishal Juneja Turned a Family Tradition Into a Paris Baguette Franchise

How Vishal Juneja Turned a Family Tradition Into a Paris Baguette Franchise Built on Heart and Community

paris-baguette-franchise-rockaway-new-jersey-vishal-junjea

New Jersey Hospitality Bill A-1958 Passes Assembly, Sparks Backlash from International Franchise Association

MORE STORIES LIKE THIS