Is an All Team franchisee restricted to servicing Placement Customers and Candidates only within their designated Area?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
ry Service Business is operated. FRANCHISEE's Agency shall provide only the placement services set forth in the Confidential Operations Manual. FRANCHISEE's customers for Permanent Placement Business ("Placement Customers") are those seeking to hire permanent personnel ("Candidates").
FRANCHISEE's Placement Customers will typically be located within the Area. However, FRANCHISEE may service Placement Customers and Candidates from anywhere within or outside of the Area except for the following restriction: If FRANCHISEE obtains a request to fill a position ("job order") outside of its Area, FRANCHISEE must first offer the ATFC agency (i.e. an agency operated by any affiliate or other franchisee or licensee) that operates in the location of the job, the opportunity to fill that job order. If the customer is not referred to the agency office that operates in the location of the job, FRANCHISEE will be charged a fine of $1,000 for the first violation, $2,500 for the second violation, and $5,000 for the third and each subsequent violation. ATFC has the right to collect these amounts in addition to exercising any and all other rights it may have for non-compliance under this Agreement. In addition, FRANCHISEE will be required to pay restitution of the profit FRANCHISEE derived from the wrongfullyperformed services to the agency that services that area, as applicable. If that ATFC agency cannot or waives the right to fill the job order, in writing, FRANCHISEE may fill it. In any event, FRANCHISEE must seek the assistance of other ATFC agencies if it cannot fill a job order. If a Candidate who is hired by a Placement Customer is placed with the assistance of another ATFC agency office, FRANCHISEE shall equally share the placement fee with the party who assisted in the placement. ATFC will first take all of its fees from each party's half of the placement fee, and then pay the balance to FRANCHISEE and the other ATFC agency. Likewise, if FRANCHISEE assists another ATFC agency in placing a Candidate, the other ATFC agency will be required to equally share the placement fee with FRANCHISEE, after ATFC takes all of its fees from each party's half of the placement fee.
FRANCHISEE must provide for a guarantee period in its placement agreements whereby a replacement Candidate will be provided if the original Candidate is not found to be satisfactory within a specified period of time. If the Placement Fee was split between the FRANCHISEE and another ATFC agency, said ATFC agency that supplied the Candidate shall have the responsibility of providing a replacement to the Placement Customer. If said ATFC agency cannot supply a replacement Candidate, then it must refund the portion of the Placement Fee which it received back to the FRANCHISEE and FRANCHISEE shall be responsible for obtaining a replacement Candidate. Likewise, if another ATFC agency filled the job order with the assistance of the FRANCHISEE and the Placement Customer requires a replacement, FRANCHISEE will be responsible for providing a replacement Candidate or immediately refunding its portion of the Placement Fee back to the other ATFC agency. Notwithstanding the foregoing, ATFC is not responsible for the amount of the Placement Fee which is being refunded to the ATFC agency or to the FRANCHISEE, as the case may be, for failure to obtain a replacement Candidate.
If any disputes arise as to the sharing of any placement fees, a determination shall be made by ATFC and such determination shall be binding on the parties. ATFC is not responsible for payments due to FRANCHISEE of its share of any placements, unless the placement is made of a Candidate who was placed by ATFC with the assistance of FRANCHISEE.
B. Rights Reserved.
Source: Item 22 — CONTRACTS (FDD pages 33–34)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, franchisees are generally expected to service Placement Customers within their designated area. However, there are exceptions and specific procedures to follow when dealing with job orders and customers outside of the franchisee's area.
For Permanent Placement Business, All Team franchisees must operate within their designated area. The FDD states that franchisees may service Placement Customers and Candidates from anywhere within or outside of their area, but with a significant restriction. If an All Team franchisee gets a job order outside their area, they must first offer the opportunity to fill it to the All Team franchise operating in that job's location.
If the franchisee fails to offer the job to the appropriate All Team franchise, they will be fined. The first violation incurs a $1,000 fine, the second a $2,500 fine, and the third and subsequent violations cost $5,000 each. Additionally, the franchisee must pay restitution to the agency that services the area, covering the profit they derived from the improperly performed services. However, if the other All Team agency cannot fulfill the job order or waives their right to do so in writing, the original franchisee can then proceed to fill it. In cases where a Candidate is placed with the assistance of another All Team agency, the placement fee will be equally shared between the franchisees after All Team takes its fees.
For the Temporary Service Business, the All Team franchisee must operate solely within their designated area. If a customer wants the franchisee to provide services outside of the area, the franchisee must immediately refer the customer to the agency office that services that area. If the customer is not referred, the franchisee will be charged a fine of $1,000 for the first violation, $2,500 for the second violation, and $5,000 for the third and each subsequent violation. In addition, the franchisee will be required to pay restitution of the profit the franchisee derived from the wrongfully-performed services to the agency that services that area, as applicable. If the agency office that services that area waives the right to service that customer, in writing, the franchisee may service that customer outside of its Area. If neither All Team, any of its affiliates or licensees, nor any other agency services said area, the franchisee may provide temporary services to said customer.