For a Coffee News franchise, can a franchisee require a non-compete agreement from employees?
Coffee_News Franchise · 2025 FDDAnswer from 2025 FDD Document
As the owner of the franchise(s), you are responsible for the compliance of all employees with the terms and conditions of the Franchise Agreement including your manager, on- premises supervisor or minority stockholder, if a company. If the franchisee is a company, there is no minimum equity interest required that the on-premises supervisor must have in the company. We do not impose any restriction that you must place on your managerial staff. You may, however, require a non-compete of all employees and a non-disclosure of trade secrets.
Source: Item 15 — Obligation to Participate in the Actual Operation of the Franchise Business (FDD pages 24–25)
What This Means (2025 FDD)
According to the 2025 Coffee News Franchise Disclosure Document, franchisees have the option to require non-compete agreements from their employees. Specifically, as the owner of the franchise, the franchisee is responsible for the compliance of all employees with the terms and conditions of the Franchise Agreement.
The FDD states that Coffee News does not impose any restrictions on what franchisees must place on their managerial staff. However, franchisees may require a non-compete of all employees and a non-disclosure of trade secrets.
This flexibility allows Coffee News franchisees to protect their business interests by ensuring employees do not compete with the franchise during or after their employment and that trade secrets remain confidential. This is a common practice in franchising, as it helps maintain the integrity and competitive advantage of the franchise system.