Does the City Publications franchise agreement prohibit inducing employees of other City Publications franchisees to leave their employment?
City_Publications Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee covenants that, except as otherwise approved in writing by Franchisor, neither Franchisee nor any partner(s), officer(s), director(s), member(s), executives, professional staff or sales staff or the spouses of any of the foregoing shall, during the term hereof, either directly or indirectly, for itself or through, on behalf of or in conjunction with, any person, persons, partnership, corporation, limited liability company or other entity:
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- Own an interest in, manage, operate, be employed, in a sales or management capacity, by, or act as a consultant to any Competitive Business anywhere;
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- Initiate any action to hire, or attempt to hire for any other employer, any person who is employed by Franchisor or employed by any other franchisee of the CITY PUBLICATIONS System, or induce any such person to leave his employment with Franchisor or any other franchisee in order to work for any other employer, whether or not the person's employment with the business is pursuant to a written agreement or is at will; or
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- Divert business of customers of the Franchised Business or other Franchisor or franchisee-owned CITY PUBLICATIONS Businesses to any Competitive Business.
Source: Item 23 — RECEIPT (FDD pages 39–129)
What This Means (2025 FDD)
According to the 2025 City Publications Franchise Disclosure Document, the franchise agreement addresses the solicitation and hiring of employees within the City Publications system. During the term of the agreement, a franchisee is prohibited from initiating any action to hire or attempt to hire any person employed by City Publications or any other City Publications franchisee for any other employer. This extends to inducing any such person to leave their employment with City Publications or another franchisee to work for another employer, regardless of whether the employment is based on a written agreement or is at-will.
This restriction aims to protect the stability of the City Publications franchise network by preventing franchisees from poaching employees from each other or from the franchisor itself. This type of restriction is relatively common in franchising, as employee turnover can negatively impact the operations and reputation of individual franchises and the overall brand. By including this clause, City Publications seeks to maintain a consistent and experienced workforce across its franchise system.
For a prospective City Publications franchisee, this means they cannot actively recruit or encourage employees of other franchisees or the franchisor to leave their current positions. Violating this provision could lead to legal repercussions, as the agreement specifies that City Publications is entitled to seek equitable remedies, including restraining orders and injunctions, in the event of a breach or threatened breach of these covenants. Franchisees should be aware of this restriction and ensure their hiring practices comply with the terms of the franchise agreement to avoid potential conflicts with City Publications.