Can a Cinnaholic franchisee solicit employees of other Cinnaholic franchisees 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 soliciting employees of other Cinnaholic franchisees. Specifically, during the term of the Franchise Agreement, a franchisee (referred to as "Developer" in this section) and related parties are prohibited from directly or indirectly soliciting or attempting to solicit employees of other Cinnaholic franchisees. This restriction also extends to interfering with or disrupting the employment relationship between Cinnaholic franchisees and their employees.
This non-solicitation clause remains in effect not only while the Franchise Agreement is active but also for one year after the agreement's expiration or termination, regardless of the reason for termination. The restriction also applies following a transfer of the franchise by the franchisee. This extended period aims to protect Cinnaholic and its franchisees from losing valuable employees to other franchisees within the system, which could disrupt operations and create instability.
Furthermore, Cinnaholic requires that certain related parties of the franchisee, referred to as "Bound Parties," also agree to these non-solicitation terms by signing a Personal Covenants agreement. This ensures that individuals closely associated with the franchisee, who might have influence or access to employees, are also bound by the same restrictions. This comprehensive approach underscores the importance Cinnaholic places on maintaining stability and preventing internal competition for employees within its franchise network.