Is an All Team USER or their employees considered an employee of ATFC for tax or withholding requirements?
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.
Source: Item 23 — RECEIPT (FDD pages 34–161)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, neither the USER (franchisee) nor any individual compensated by the USER is considered an employee of ATFC (the franchisor) for any purpose, including tax or withholding requirements. The USER is solely responsible for the day-to-day operations of their All Team business. This is reinforced by the stipulation that the USER shall not have the power to obligate ATFC for any liabilities or expenses, except as expressly agreed to in writing by ATFC.
This arrangement means that each All Team franchisee operates as an independent contractor. They are responsible for handling all employment-related obligations for their own employees, including payroll, taxes, and compliance with labor laws. All Team provides processing services, including payroll, but the responsibility for accurate reporting and tax payments ultimately falls on the franchisee.
Furthermore, the USER is required to indemnify and hold ATFC harmless from any suits, claims, or demands arising from the USER's acts or omissions or those of its employees or agents. This includes any issues related to employment or failure to comply with legal requirements. This indemnification clause underscores the independent nature of the franchise relationship and the franchisee's responsibility for their business operations.
Prospective All Team franchisees should understand that they will be considered independent business owners and employers, not employees of All Team. They should consult with legal and financial professionals to ensure they understand their obligations regarding employment, taxes, and other legal requirements.