Under the Counselor Realty franchise agreement, is the franchisee considered an employee of Counselor Realty?
Counselor_Realty Franchise · 2025 FDDAnswer from 2025 FDD Document
- 13.5 Relationships. You are an independent contractor, not the employee, agent, partner or joint venturer of Counselor. This Agreement does not create a fiduciary relationship or a relationship of special trust and confidence. No person may acquire any interest in or under this Agreement except in accordance with Article 9. No other person except our affiliate is intended to be a beneficiary of this Agreement. If Franchisee is more than one person, all are jointly and severally liable hereunder. If Franchisee is a partnership, corporation or other entity, all of its partners, shareholders or owners from time to time shall execute the guaranty at the foot of this Agreement. We owe no implied duties to you.
Source: Item 22 — CONTRACTS (FDD page 32)
What This Means (2025 FDD)
According to Counselor Realty's 2025 Franchise Disclosure Document, the franchisee is explicitly considered an independent contractor and not an employee of Counselor Realty. The franchise agreement states that the relationship between the franchisee and Counselor Realty is not that of an employee, agent, partner, or joint venturer. Furthermore, the agreement clarifies that it does not establish a fiduciary relationship or a relationship of special trust and confidence.
This distinction is crucial because it means franchisees are responsible for their own business operations, including hiring and managing employees. They are not entitled to employee benefits such as health insurance, paid time off, or retirement plans from Counselor Realty. The franchisee is responsible for all employment-related obligations, including withholding taxes and providing workers' compensation insurance, if required.
This independent contractor status is a common arrangement in the franchise industry, allowing franchisors to maintain a degree of control over brand standards and operational procedures without incurring the legal and financial obligations associated with an employer-employee relationship. Prospective franchisees should carefully consider the implications of this arrangement, including the need to manage their own business affairs and assume the risks and responsibilities of business ownership.