Does the non-disparagement clause in the Body20 franchise agreement extend to my employees?
Body20 Franchise · 2025 FDDAnswer from 2025 FDD Document
You agree not to (and to use your best efforts to cause your current and former owners, officers, directors, principals, agents, partners, employees, representatives, attorneys, owners' spouses and children, Affiliates, successors, and assigns not to) disparage or otherwise speak or write negatively, directly or indirectly, of us, our Affiliates, any of our or our Affiliates' directors, officers, employees, representatives, or Affiliates, current and former franchisees or developers of us or our Affiliates, the Brand, the System, any Studio or other business using the Marks, any other brand or service-marked or trademarked concept of us or our Affiliates, or which would subject the Brand or such other brands to ridicule, scandal, reproach, scorn, or indignity, or which would negatively impact the goodwill of us, the Brand, or such other brands.
Source: Item 23 — RECEIPT (FDD pages 74–251)
What This Means (2025 FDD)
According to Body20's 2025 Franchise Disclosure Document, the non-disparagement clause extends to the franchisee's employees. Specifically, the franchise agreement states that the franchisee must use their best efforts to ensure that their current and former employees do not disparage Body20. This means a franchisee is responsible for attempting to control negative statements made by their employees about the Body20 brand.
This requirement places an obligation on the franchisee to actively manage and monitor the speech of their employees, both during and after their employment. Practically, this could involve including non-disparagement clauses in employee contracts, training employees on appropriate communication, and taking action if an employee violates the non-disparagement provision. The franchisee's responsibility extends not only to direct disparagement but also to indirect negative statements that could harm Body20's reputation.
Failure to comply with this provision could result in the franchisee being held liable for their employees' actions. This could potentially lead to legal action from Body20 if the disparagement is deemed harmful to the brand. Therefore, it is crucial for prospective franchisees to understand the scope of this clause and implement measures to ensure their employees comply with it.
It is important for a prospective Body20 franchisee to consult with a legal professional to fully understand the implications of the non-disparagement clause and how it applies to their employees. They should also seek clarification from Body20 regarding the specific steps they are expected to take to ensure employee compliance and the potential consequences of failing to do so.