After the Benihana franchise term expires or terminates, for how long is the franchisee prohibited from employing certain individuals?
Benihana Franchise · 2024 FDDAnswer from 2024 FDD Document
18.4 Franchisee covenants that, during the Franchise Term and for a period of two (2) years after the expiration or termination hereof, Franchisee shall not, directly or indirectly:
(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, for a period of two years after the expiration or termination of the franchise agreement, franchisees are restricted from employing or attempting to employ individuals who are currently or have been employed by Benihana, its affiliates, or other Benihana franchisees within the one year prior to the expiration or termination. This restriction includes inducing such individuals to leave their employment.
This provision aims to protect Benihana's network by preventing franchisees from poaching employees who have knowledge of the Benihana system or relationships with the company or other franchisees. It ensures that departing franchisees cannot unfairly compete by leveraging the expertise and connections of individuals associated with the Benihana brand.
For a prospective franchisee, this means that upon exiting the Benihana system, they must avoid recruiting from Benihana's existing talent pool for two years. This could potentially limit their access to experienced staff if they choose to operate a similar restaurant concept after their Benihana franchise ends. Franchisees should factor this restriction into their long-term business plans and consider the implications for staffing any future ventures.