In a Bath Tune Up franchise transfer, is the existing franchisee prohibited from inducing employees of other franchisees to leave their employment?
Bath_Tune_Up Franchise · 2025 FDDAnswer from 2025 FDD Document
- (a) As consideration for Franchisor and New Franchisee to enter into this Consent and Assumption, Existing Franchisee shall refrain from, either directly or indirectly, for {itself or himself or herself or themselves} or through, on behalf of, or in conjunction with any person, persons, partnership, corporation or other entity, within the Territory, and from the date of this Agreement through :
- (i) Diverting or attempting to divert any business or customer of the Franchised Business to any competitor, by direct or indirect inducement or otherwise, or doing or performing, directly or indirectly, any other act injurious or prejudicial to the goodwill associated with Franchisor's Marks and the System (as that term is defined in the Franchise Agreement);
- (ii) Employing or seeking to employ any person who is at that time employed by Franchisor, affiliates of Franchisor, or by any other franchisee or licensee of Franchisor, including but not limited to New Franchisee, or otherwise directly or indirectly inducing or seeking to induce such person to leave his or her employment thereat; or
Source: Item 22 — CONTRACTS (FDD page 52)
What This Means (2025 FDD)
According to Bath Tune Up's 2025 Franchise Disclosure Document, an existing franchisee is restricted from soliciting employees of other franchisees during a franchise transfer. Specifically, the existing franchisee is prohibited from employing or seeking to employ any person who is currently employed by Bath Tune Up, its affiliates, or any other franchisee or licensee of Bath Tune Up, including the new franchisee. This restriction includes directly or indirectly inducing or seeking to induce such a person to leave their current employment.
This measure is designed to protect the stability of the Bath Tune Up franchise network by preventing the poaching of employees. It ensures that franchisees can maintain their workforce without the risk of losing them to a transferring franchisee who might be looking to quickly staff their new or transitioned business. The restriction applies within the territory of the transferring franchise.
In addition to not soliciting employees, the existing Bath Tune Up franchisee must also refrain from diverting business or customers to competitors or performing any actions that could harm the goodwill associated with Bath Tune Up's marks and system. These restrictions are in place from the date of the transfer agreement.
These conditions are part of the consideration for Bath Tune Up and the new franchisee entering into the Consent and Assumption agreement, highlighting the importance of maintaining network stability and protecting the brand's reputation during franchise transfers.