Can a Cinnaholic franchisee disrupt the employment relationship between the franchisor and its employees during the term of the agreement?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
- 14.2. Non-Solicitation of Employees. Developer and the Bound Parties agree that while this Agreement is in effect and for one year after expiration or termination of this Agreement for any reason, or following the date of a Transfer by Developer, they will not, directly or indirectly, solicit or attempt to solicit, or otherwise interfere with or disrupt the employment relationship between Franchisor and any of its employees or between any other CINNAHOLIC® franchisee and its employees.
Source: Item 23 — RECEIPT (FDD pages 62–269)
What This Means (2025 FDD)
According to Cinnaholic's 2025 Franchise Disclosure Document, franchisees are restricted from disrupting Cinnaholic's employment relationships. Specifically, during the term of the Franchise Agreement and for one year after its expiration or termination, a Cinnaholic franchisee (referred to as 'Developer') and related parties cannot solicit or interfere with the employment relationships of Cinnaholic or its other franchisees. This restriction also applies following a transfer of the franchise by the franchisee.
This non-solicitation clause is designed to protect Cinnaholic and its franchisees from losing valuable employees to their franchisees. It prevents franchisees from poaching employees who have been trained and have gained experience within the Cinnaholic system. The 'Bound Parties' of the franchisee must also agree to these terms by signing the Personal Covenants agreement.
This type of clause is common in franchising to maintain stability within the franchise network and protect the investment Cinnaholic makes in its employees and the investment other franchisees make in their employees. Prospective franchisees should understand that this restriction is in place to foster a stable environment and prevent unfair competition for employees within the Cinnaholic system.