Does the 7 Brew franchise agreement establish a partnership, joint venture, or employment relationship between the franchisor and franchisee?
7_Brew Franchise · 2025 FDDAnswer from 2025 FDD Document
We (and our affiliates) will not exercise direct or indirect control over the working conditions of Store personnel, except to the extent such indirect control is related to our legitimate interest in protecting the quality of our products, services, or brand. We (and our affiliates) do not share or codetermine the employment terms and conditions of the Store's employees and do not affect matters relating to the employment relationship between you and the Store's employees, such as employee selection, promotion, termination, hours worked, rates of pay, other benefits, work assigned, discipline, adjustment of grievances and complaints, and working conditions. To that end, you must notify Store personnel that you are their employer and that we, as the franchisor of 7 BREW Stores, and our affiliates are not their employer and do not engage in any employertype activities for which only franchisees are responsible, such as employee selection, promotion, termination, hours worked, rates of pay, other benefits, work assigned, discipline, adjustment of grievances and complaints, and working conditions. You also must obtain an acknowledgment from all Store employees that you (and not we or our affiliates) are their employer.
B. No Liability for Acts of Other Party
We and you may not make any express or implied agreements, warranties, guarantees, or representations, or incur any debt, in the name or on behalf of the other or represent that our relationship with you is other than franchisor and franchisee. We will not be obligated for any damages to any person or property directly or indirectly arising from the Store's operation or the business you conduct under this Agreement.
Source: Item 22 — CONTRACTS (FDD pages 82–83)
What This Means (2025 FDD)
According to the 2025 7 Brew Franchise Disclosure Document, the franchise agreement explicitly states that the relationship between 7 Brew and its franchisees is that of franchisor and franchisee. The agreement does not establish a partnership, joint venture, or employment relationship. Franchisees are required to acknowledge their status as independent operators and to clearly communicate to their employees that they, the franchisees, are the employers, not 7 Brew. Franchisees must also secure an acknowledgment from all store employees confirming that the franchisee is their employer.
7 Brew maintains that it will not exercise direct or indirect control over the working conditions of the store personnel, except when it is related to protecting the quality of their products, services, or brand. 7 Brew does not share or co-determine the employment terms and conditions of the store's employees. The franchisee is solely responsible for employment-related activities, including employee selection, promotion, termination, pay rates, and working conditions.
The franchise agreement specifies that neither 7 Brew nor the franchisee can create any agreements, warranties, or debts in the name of the other party. Furthermore, neither party can represent their relationship as anything other than franchisor and franchisee. 7 Brew is not liable for damages arising from the store's operation or the franchisee's business conduct.