Does the Crave franchise agreement require the franchisee to indemnify the franchisor from liability arising from claims alleging an agency or employment relationship?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
14.2 During the term of this Agreement, you shall hold yourself out to the public as an independent licensee conducting your operations pursuant to the rights granted by us. You agree to take such action as shall be reasonably necessary to that end, including, without limitation, exhibiting a notice of that fact in a conspicuous place on any Franchised Business premises established for the purposes hereunder and on all letterhead, business cards, forms, and as further described in the Manual. We reserve the right to specify in writing the content and form of such notice.
You acknowledge and agree that any training we provide for your employees is geared to impart to those employees, with your ultimate authority, the various procedures, protocols, systems and operations of a Crave outlet and in no fashion reflects any employment relationship between us and such employees. If it is ever asserted that we are the employer, joint employer or co-employer of any of your employees in any private or government investigation, action, proceeding, arbitration or other setting, you irrevocably agree to assist us in defending said allegation, appearing at any venue requested by us to testify on our
behalf; participating in depositions or other appearances; or preparing affidavits rejecting any assertion that we are the employer, joint employer or co-employer of any of your employees.
14.3 You understand and agree that nothing in this Agreement authorizes you to make any contract, agreement, warranty or representation on our behalf, or to incur any debt or other obligation in our name, and that we assume no liability for, nor shall be deemed liable by reason of, any act or omission of yours or any claim or judgment arising therefrom. You shall indemnify and hold us and our officers, directors, and employees harmless against any and all such claims arising directly or indirectly from, as a result of, or in connection with your activities hereunder, as well as the cost, including reasonable attorneys' fees, of defending against them, except that the foregoing shall not apply to infringement actions regarding the Marks which are caused solely by our actions or actions caused by the negligent acts of us or our agents.
Source: Item 23 — RECEIPTS (FDD pages 63–253)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, the franchise agreement addresses the relationship between Crave and the franchisee's employees. Specifically, the franchisee acknowledges that any training Crave provides to the franchisee's employees is intended to impart the operational procedures of a Crave outlet and does not reflect an employment relationship between Crave and those employees.
The agreement stipulates that if any claim arises asserting that Crave is the employer, joint employer, or co-employer of the franchisee's employees, the franchisee must assist Crave in defending against such allegations. This includes providing testimony, participating in depositions, and preparing affidavits to reject any assertion of an employment relationship between Crave and the franchisee's staff.
Furthermore, the Crave franchise agreement states that the franchisee must indemnify Crave and its officers, directors, and employees from any claims arising directly or indirectly from the franchisee's activities. This includes the cost of defending against such claims, including reasonable attorney's fees. However, this indemnification does not extend to infringement actions regarding the Marks caused solely by Crave's actions or actions caused by the negligent acts of Crave or its agents. This means the franchisee is responsible for defending Crave against claims related to the franchisee's employees, unless those claims are a direct result of Crave's own negligence or actions.