Are All Team franchisees allowed to sell competing services?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
to use or duplicate or to allow others to use or duplicate any of the knowledge, know-how and expertise received by FRANCHISEE for any reason other than for the operation of the Agency under this Agreement. FRANCHISEE further recognizes the importance of devoting substantial time and energy to Agency. FRANCHISEE, therefore, warrants that during the term of this Agreement, unless FRANCHISEE has the prior written consent of ATFC, FRANCHISEE shall not directly or indirectly, through itself or through corporations, partnerships, trusts, associations, joint ventures, unincorporated businesses, limited liability companies, or otherwise perform any services for, engage in or acquire, be an employee of, have any financial, beneficial or equity interest in, loan money to, lease property to, or have any interest based on profits or revenues of any business which is similar or competing with the business franchised hereunder ("Similar Business"), except as a duly licensed franchisee of ATFC. This section does not limit FRANCHISEE's obligation under Section XI.B. of this Agreement.
At the time that this Agreement is signed, a "Similar Business" is one which provides temporary and permanent staffing in the following areas: healthcare and environmental, hospitality and food service, management recruiting, labor and light industrial and administrative and clerical. However, as noted in Section XV, the business of the Agency is subject to change, and a "Similar Business" shall be interpreted at the time that the applicable provision is effective.
B. Non-Competition After Termination. For two (2) years after the termination, expiration or Transfer of this Agreement for any reason, unless FRANCHISEE has the prior written consent of ATFC:
FRANCHISEE will not directly or indirectly, through itself or through corporations, partnerships, trusts, associations, joint ventures, limited liability companies, or other entities or otherwise, perform any services for, engage in or acquire, be an employee of, have any financial interest in, loan money to, lease property to, or have any interest based on profits or revenues of any Similar Business. The geographical scope of this restriction shall cover the Area of the Agency and the area of any other ATFC agency, whether such agency is operated by ATFC, an affiliate of ATFC, a licensee of ATFC, or a franchisee of ATFC.
FRANCHISEE will not, directly or indirectly, on its own behalf or on the behalf of others, solicit or service for, or divert or appropriate to any Similar Business, or attempt to solicit, divert or appropriate to or from any Similar Business, any person or entity which is or was at any time during the preceding two (2) year period a customer of FRANCHISEE, ATFC or any affiliate or licensee or franchisee of ATFC.
FRANCHISEE will not, either directly or indirectly, on its own behalf or on the behalf of others, solicit, divert or hire away, or attempt to solicit, divert or hire away, to any Similar Business any person employed by ATFC or its affiliates or licensees, nor will FRANCHISEE solicit, divert or hire away or attempt to solicit, divert or hire away to the Agency or any Similar Business any such employee of any licensee or franchisee of ATFC without the prior written consent of such licensee or franchisee of ATFC.
C.
Source: Item 16 — RESTRICTIONS ON WHAT THE FRANCHISEE MAY SELL (FDD page 28)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, franchisees are significantly restricted from offering services that compete with All Team, both during the term of the franchise agreement and for a period afterward. During the agreement, franchisees cannot engage in any business that is similar to or competes with All Team's services without prior written consent from All Team. A "Similar Business" at the time of signing includes temporary and permanent staffing in healthcare, environmental, hospitality, food service, management recruiting, labor, light industrial, and administrative/clerical areas. However, All Team retains the right to modify the definition of "Similar Business," meaning the scope of prohibited activities could change over time.
This restriction extends beyond just direct competition. Franchisees are prohibited from being an employee of, having a financial interest in, loaning money to, or leasing property to any competing business. This broad definition aims to prevent franchisees from indirectly supporting or benefiting from competing ventures. The FDD also states that franchisees must provide all services required by All Team, and are prohibited from offering or selling any unauthorized services or products. All Team reserves the right to change the types of services and products franchisees are required to offer, without any limitations.
After the termination, expiration, or transfer of the franchise agreement, the non-compete restrictions continue for two years. During this period, former franchisees are barred from engaging in similar businesses within the area of their former All Team agency, as well as the area of any other All Team agency. They are also prohibited from soliciting or servicing customers of All Team or its franchisees. These extensive non-compete clauses are designed to protect All Team's market share, trade secrets, and customer relationships, but they could significantly limit a franchisee's business opportunities after leaving the All Team system.