Does the Brain Balance agreement prohibit franchisees from attempting to employ individuals currently employed by Brain Balance?
Brain_Balance Franchise · 2025 FDDAnswer from 2025 FDD Document
- 10.17. (a) All permanent staff of the Franchised Business shall execute Exhibit 3, the Confidentiality, Non-Solicitation, and Non-Compete Agreement as provided in the Operations Manual.
FRANCHISEE will take such action in connection therewith as may be required by COMPANY both during and upon termination of this Agreement in order to protect any trade secrets that are proprietary to COMPANY or any information, knowledge, or know-how deemed confidential under this Agreement.
Source: Item 22 — CONTRACTS (FDD pages 70–72)
What This Means (2025 FDD)
According to the 2025 Brain Balance Franchise Disclosure Document, section 10.17(a) states that all permanent staff of the franchised business must execute Exhibit 3, which is a Confidentiality, Non-Solicitation, and Non-Compete Agreement as provided in the Operations Manual. This agreement is designed to protect the company's trade secrets and confidential information both during and after the franchise agreement term.
This clause means that Brain Balance franchisees must ensure their employees sign a non-solicitation agreement, which likely restricts them from recruiting or hiring current employees of Brain Balance. The specific terms and duration of these restrictions would be detailed in Exhibit 3 and the Operations Manual, which franchisees should review carefully.
It is common practice in franchising to include non-solicitation clauses to protect the franchisor's and other franchisees' investment in training and developing their workforce. Prospective Brain Balance franchisees should obtain and carefully review Exhibit 3 and the Operations Manual to fully understand the scope and limitations of the non-solicitation and non-compete agreements required for their staff. Understanding these obligations is crucial for managing staff and avoiding potential legal issues.