A recent incident at a hotel in Minneapolis has escalated into a public relations and political clash, putting the spotlight on the complex relationship between major brands and their franchise operators. The controversy began when a Hampton Inn, operating under the Hilton brand, allegedly refused to accept reservations from federal immigration agents last week.
Federal Agency Calls Out Hotel Giant
In response, the U.S. Department of Homeland Security (DHS) under President Donald Trump publicly criticized the Hilton Hotels conglomerate. The agency took to the social media platform X to accuse @HiltonHotels of launching a "coordinated campaign in Minneapolis to REFUSE service to DHS law enforcement." This statement triggered significant backlash from right-wing commentators and supporters online, creating a wave of negative attention for the hotel chain.
Hilton quickly responded, clarifying that it does not own the specific property in question. The hotel was operated by a franchisee, a company named Everpeak Hospitality, which would have been responsible for the decision to cancel the agents' bookings. Despite this distinction, the political pressure intensified. After a conservative influencer posted a video suggesting the policy of denying DHS reservations was still active, Hilton took decisive action.
Franchise Agreement Terminated Amid Backlash
On Tuesday, Hilton announced it was severing its ties with Everpeak Hospitality. In an official statement, the company said, "We are also engaging with all of our franchisees to reinforce the standards we hold them to across the system to help ensure this does not happen again." Prior to this termination, Everpeak had publicly apologized and stated it had "moved swiftly to address this matter."
The situation presents a contradiction in the franchise model's typical defense. For years, large parent companies like Hilton and McDonald's have argued that franchisees are independent operators who set their own day-to-day policies, including employment and operational decisions. This argument is often used to distance the brand from liability for labour violations or union negotiations at franchised locations.
Political Context and the Franchise Debate
The Trump administration has been a notable supporter of the franchise business model. During his first term, President Trump rolled back the Obama-era "joint employer" rule. That regulation could have held major brands legally responsible for labour conditions at their franchisees' establishments. Trump famously told franchise owners, "You were screwed," implying his actions had protected their business structure.
Industry lobbyists were quick to frame the Minneapolis event as educational. Matt Haller, CEO of the International Franchise Association, stated on X that it was a "teachable moment for everyone today about how the franchise business model works." He emphasized, "Hilton is not the direct employer. They license the brand to this franchisee to operate hotels under its brand."
When asked who it ultimately held responsible for the reservation denials—Hilton or Everpeak—the DHS did not provide a direct answer. However, spokesperson Tricia McLaughlin expressed satisfaction with Hilton's action, stating, "We are glad to see Hilton Hotels take this step." The episode underscores the ongoing tension between corporate brand management, franchisee independence, and political pressure.
