For a Coffee News franchise, can a franchisee require a non-disclosure of trade secrets 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 Coffee News's 2025 Franchise Disclosure Document, franchisees have the option to require a non-disclosure of trade secrets from their employees. While Coffee News does not mandate specific restrictions on managerial staff, franchisees can implement non-compete agreements and non-disclosure agreements to protect trade secrets.
Specifically, the Franchise Agreement states that the franchisee is responsible for the compliance of all employees with the terms and conditions outlined in the agreement. This includes any manager, on-premises supervisor, or minority stockholder if the franchisee is a company.
This flexibility allows Coffee News franchisees to safeguard confidential business information and maintain control over their operations. It is important for prospective franchisees to understand that while Coffee News does not impose these requirements, the responsibility falls on the franchisee to ensure their staff adheres to the Franchise Agreement's terms.