What happens to the customer invoices when All Team provides payroll funding?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
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Pursuant to the Franchise Agreement, Funding Agreement and the Processing Agreement, we will bill your customers directly on behalf of your Agency and under "All Team Staffing" and your name, with instructions to remit payment directly to our designated financial institution. Your customers make their payments to us and we will apply the funds as follows:
- a. Apply full payment to each invoice paid by your customers;
- b. Pay you the reserve amount held out by our funding source (currently 20%) with your next payment for your weekly sales no later than Friday of each week.
Regarding garnishment or wage withholding, you are responsible for entering any garnishment into the software program before the payroll is processed. Also, you are responsible to make the payments to the proper authority as required in the withholding order.
You will pay us a one-time Funding Fee of 1.5% of the Customer Invoice value at the time we purchase the Customer Invoice. If the Customer Invoice is not paid within 30 days from the Customer Invoice date, then we will charge you an Accounts Receivable Service Charge of 0.05% per day of the outstanding amount for any delinquent amount up until 90 days from the Customer Invoice date.
Source: Item 10 — FINANCING (FDD pages 17–18)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, when All Team provides payroll funding, they purchase the franchisee's customer invoices, which then become All Team's accounts receivables. All Team bills the franchisee's customers directly under "All Team Staffing" and the franchisee's name, instructing customers to remit payments to All Team's designated financial institution.
All Team applies the full payments received from the franchisee's customers to each invoice. They then pay the franchisee the reserve amount held out by their funding source, which is currently 20%, with the franchisee's next payment for their weekly sales. This payment is made no later than Friday of each week. The franchisee is responsible for entering any garnishments into the software program before payroll processing and for making payments to the appropriate authority as required by the withholding order.
This arrangement means that All Team takes control of the invoicing and payment collection process, which can reduce the administrative burden on the franchisee. However, franchisees need to be aware that All Team retains a security interest in their accounts receivable until all amounts due are paid. Franchisees are also required to indemnify All Team in the event of any lawsuit resulting from the Funding Agreement, including responsibility for reasonable attorney's fees.