Core rule · Rules Tome 2.0.8 § 507.1.4
Loyalty penalty
An off-faction Character normally enters your formation stunned.
How it works
Full rule
A Character whose faction differs from your Warlord suffers the loyalty penalty when put into play and enters stunned. Mercenary Guild Characters never suffer this penalty.
At the table
Example
A Free Kingdoms army puts a non-Mercenary Elven Branches Character into play; that Character enters stunned.
Watch for this
Common mistake
Entering through a spell or retrieval effect does not avoid loyalty unless the effect or another rule says so.