Does Byrider prohibit me from hiring employees of Byrider, its affiliates, or its franchisees without prior written permission?
Byrider Franchise · 2025 FDDAnswer from 2025 FDD Document
- 18.5 Fee for Employment Practices. Franchisee acknowledges that the Company and Byrider Businesses make substantial investment in the hiring, training, and developing of its and their employees. Although Franchisee is not restricted from soliciting and/or hiring such employees, Franchisee agrees that if, during the Term and for a one (1)-year period after the termination or expiration of this Agreement, Franchisee or any of its owners, directly or indirectly, on behalf of itself or any other person (whether as an owner, employee, agent, consultant or in any other capacity), employs any person who is an employee of, or who, within one year of being hired by Franchisee, was previously employed by, the Company (or any of its affiliates) or any Byrider Business, without the written consent of the Company (or such affiliate) or such Byrider Business, then Franchisee must immediately pay an amount of damages equal to three (3) times the annual compensation of such individual to the Company (or its affiliate) or Byrider Business, as applicable.
Source: Item 23 — Receipts (FDD pages 88–335)
What This Means (2025 FDD)
According to Byrider's 2025 Franchise Disclosure Document, franchisees are not restricted from soliciting or hiring employees of Byrider, its affiliates, or other Byrider businesses. However, there are specific financial implications if a franchisee hires such an employee.
Specifically, if during the term of the Franchise Agreement, or for one year after its termination or expiration, a franchisee hires someone who is currently or was previously (within one year of being hired by the franchisee) employed by Byrider (or its affiliates) or any Byrider Business, the franchisee must pay damages. This payment is equal to three times the annual compensation of the hired employee. This fee is payable to Byrider (or its affiliate) or the relevant Byrider Business, as applicable. The requirement for this payment is waived if the franchisee obtains written consent from Byrider (or the relevant affiliate) or the Byrider Business before hiring the employee.
This policy is designed to protect Byrider's investment in its employees' hiring, training, and development. While not a strict prohibition, the significant financial penalty incentivizes franchisees to seek written consent before hiring employees from within the Byrider system. This type of clause is not uncommon in franchising, as franchisors often seek to protect their investment in employee training and prevent poaching of skilled staff by franchisees.