What is the relationship between ATFC and an All Team USER regarding employee status?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
ependent Contractor.** Nothing in this Processing Agreement shall be construed to constitute either party as the employee, representative or, except to the extent expressly provided herein, the agent of the other, or to constitute ATFC and USER as partners or joint venturers. USER shall not have the power and shall not represent or imply that it has the power, to obligate ATFC for any liabilities or expenses, except as otherwise expressly agreed to in writing by ATFC. Neither USER nor any individual whose compensation for services is paid by USER in any way, directly or indirectly, expressly or by implication, shall be construed to be an employee of ATFC for any purpose, including, without limitation any tax or withholding requirements levied or fixed by any governmental law, rule or regulation is solely responsible for the day-to-day operations of the Business.
- D. Indemnification. Under no circumstances shall ATFC be liable for any act, omission, debt, or other obligation of USER. USER will indemnify, defend and save harmless ATFC and its employees, agents, officers, directors, parents, subsidiaries, affiliates, successors and assigns ("Indemnitees") from and against any and all liabilities, obligations, losses, damages, penalties, claims, actions, costs and expenses (including without limitation legal fees and expenses) of any kind and nature whatsoever, including without limitation damages or injuries suffered by Indemnitees, which may be imposed on, incurred by or asserted against the Indemnitees in any way arising out of the acts or omissions of USER or its employees, agents, officers, directors, parents, subsidiaries, affiliates, successors and assigns ("Indemnitors") pursuant to or relating to this Agreement or the transactions or relationships contemplated hereby or a breach or default by USER under this Agreement regardless of whether the Indemnities were negligent or that said negligence was a contributing factor in the liability.
- E. Assignment. This Processing Agreement is personal to USER and shall not be assignable or transferable by USER, in whole or in part, either voluntarily or by operation of law, except with the prior written consent of ATFC, which consent shall not unreasonably be withheld.
Source: Item 23 — RECEIPT (FDD pages 34–161)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, the Funding Agreement clarifies the relationship between All Team Franchise Corporation (ATFC) and the franchisee (USER). Specifically, it states that neither party should be construed as the employee, representative, or agent of the other, except as expressly provided in the agreement. This also means that ATFC and the USER are not considered partners or joint venturers.
Furthermore, the agreement explicitly states that neither the USER nor any individual paid by the USER can be considered an employee of ATFC for any purpose. This includes tax or withholding requirements imposed by any governmental law, rule, or regulation. The USER is solely responsible for the daily operations of their All Team franchise business.
This independent contractor relationship has important implications for both All Team and its franchisees. The franchisee is responsible for their own business decisions and operations, while All Team is not liable for the franchisee's debts, obligations, or actions. This arrangement is common in franchising, as it allows franchisees to operate their businesses with a degree of autonomy while benefiting from the All Team brand and system.