What affiliated companies are included in the restriction against employing individuals formerly employed by Benihana or its affiliates?
Benihana Franchise · 2024 FDDAnswer from 2024 FDD Document
- (b) employ or seek to employ any person (or induce such person to leave his or her employment) who is, or has within the one (1) year prior to any such expiration or termination been, employed by BNC, any of its affiliates, including, without limitation the "Haru," or "RA" Restaurants ("Affiliated Company"), or any other franchisee operating under the BENIHANA System;
Source: Item 22 — CONTRACTS (FDD pages 73–74)
What This Means (2024 FDD)
According to Benihana's 2024 Franchise Disclosure Document, as a franchisee, you are restricted from employing or attempting to employ anyone who is or has been employed by Benihana National Corp (BNC), its affiliates, or other Benihana franchisees within one year prior to the termination or expiration of your franchise agreement. The affiliated companies specifically include the "Haru" or "RA" Restaurants. This restriction is in place during the franchise term and for two years after the franchise expires or terminates.
This restriction means that as a Benihana franchisee, you cannot actively recruit or hire employees from Benihana's corporate locations, its affiliated restaurant brands like Haru and RA, or from other Benihana franchise locations for a period of one year after their employment ends with those entities. This measure is designed to protect Benihana's investment in its employees and prevent franchisees from poaching trained staff who possess knowledge of the Benihana system.
For a prospective franchisee, this non-employment clause has several implications. It limits the pool of potential employees you can hire, especially if you are looking for experienced staff familiar with the Benihana concept. Violating this clause could lead to legal repercussions from Benihana, as they have a vested interest in protecting their employee base and proprietary knowledge. It is important to note that this restriction applies not only to direct employment but also to indirect attempts to solicit or induce employees to leave their current positions.
It is also important to understand the definition of "affiliates" in the franchise agreement, as it may extend beyond the specifically named Haru and RA Restaurants. Prospective franchisees should seek clarification from Benihana regarding the full scope of affiliated companies to ensure compliance with the non-employment clause. This understanding is crucial for maintaining a healthy relationship with the franchisor and avoiding potential legal disputes.