Can a Counselor Realty franchisee solicit employees of Counselor Realty's franchisees after the franchise is terminated?
Counselor_Realty Franchise · 2025 FDDAnswer from 2025 FDD Document
- (d) During the term of this Agreement and for a period of twenty-four (24) months after it expires, is terminated or is transferred, you will not alone, or in any capacity
with another person or entity, within the United States and any other geographical area in which Counselor operates, solicit or cause to be solicited any person or entity that is (or was within the previous six (6) months) an agent, employee or independent contractor of Counselor or another Counselor franchisee, for the purpose of hiring or contracting such person or entity to work for you or any other party, or for the purpose of inducing them to leave such party's employment or contract with Counselor or another Counselor franchisee.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 25–29)
What This Means (2025 FDD)
According to Counselor Realty's 2025 Franchise Disclosure Document, there are restrictions on soliciting agents, employees, or independent contractors of Counselor Realty or its franchisees both during the term of the franchise agreement and after termination. Specifically, for a period of 24 months after the franchise expires, is terminated, or is transferred, a franchisee is prohibited from soliciting or causing the solicitation of any person or entity who is or was an agent, employee, or independent contractor of Counselor Realty or another Counselor Realty franchisee. This restriction applies within the United States and any other geographical area in which Counselor Realty operates.
This means that after a Counselor Realty franchise is terminated, the former franchisee cannot actively seek to hire or contract with individuals who are currently or were recently (within the previous six months) associated with Counselor Realty or its other franchisees. This includes direct solicitation to work for the former franchisee or any other party, as well as actions intended to induce them to leave their current employment or contract with Counselor Realty or another franchisee.
The purpose of this clause is likely to protect Counselor Realty and its franchisees from losing valuable personnel to former franchisees who might try to leverage their knowledge of the system and relationships within the network to their advantage. It prevents a franchisee from building a competing business by poaching talent from the Counselor Realty system shortly after leaving it.
A prospective Counselor Realty franchisee should be aware of this restriction and factor it into their business plans, especially if they anticipate leaving the franchise system at some point. Understanding the geographic scope and the duration of this non-solicitation covenant is crucial for future business endeavors after the franchise agreement ends.