Is the buyer obligated to hire the seller's employees when purchasing a Del Taco franchise?
Del_Taco Franchise · 2025 FDDAnswer from 2025 FDD Document
Buyer will not be obligated to hire Seller's employees, and Buyer will tender "at will" employment to those of Seller's former employees that Buyer elects to hire, effective as soon as feasible after the applicable Closing.
Buyer will be responsible for and assume any and all liability relating to post-Closing employment of any of the employees at the Locations hired by Buyer.
Source: Item 23 — RECEIPTS (FDD pages 59–325)
What This Means (2025 FDD)
According to Del Taco's 2025 Franchise Disclosure Document, a buyer is not obligated to hire the seller's employees when purchasing a Del Taco franchise. However, if the buyer chooses to hire any of the seller's former employees, they must tender "at will" employment, effective as soon as feasible after the closing date. This means the employees can be terminated at any time, without cause, as allowed by law.
The buyer assumes full responsibility and liability for the post-closing employment of any employees they hire from the seller's locations. This includes all aspects of employment, such as wages, training, and compliance with labor laws.
Del Taco franchisees are solely responsible for all employment decisions related to their restaurants, including hiring, firing, training, and compliance with wage and hour requirements. Del Taco is not considered a joint employer with the franchisee, and franchisees must indemnify Del Taco for any costs incurred due to the actions or omissions of the franchisee or their employees, including any findings of joint employer status.