Does the Del Taco franchise agreement create an employer/employee relationship between Del Taco and the franchisee?
Del_Taco Franchise · 2025 FDDAnswer from 2025 FDD Document
16.1 It is understood and agreed by the parties hereto that this Agreement does not in any way create the relationship of principal, agent, fiduciary, joint venture, joint employer, or employer/employee between Del Taco and Franchisee; that Franchisee shall be an independent contractor; and that nothing in this Agreement is intended to constitute either party an agent, legal representative, subsidiary, joint venturer, joint employer, partner, employee, or servant of the other for any purpose whatsoever. For the avoidance of doubt, Del Taco is not the employer or joint employer of Franchisee or Franchisee's employees.
- 16.1.1 Identification as Independent Contractor.
Source: Item 22 — CONTRACTS (FDD pages 58–59)
What This Means (2025 FDD)
According to Del Taco's 2025 Franchise Disclosure Document, the franchise agreement explicitly states that it does not create an employer/employee relationship between Del Taco and the franchisee. The agreement establishes the franchisee as an independent contractor. This means that franchisees are responsible for their own business operations and are not considered employees of Del Taco.
As an independent contractor, the Del Taco franchisee is responsible for complying with all applicable laws, rules, and regulations, including employment, labor, and wage and hour laws. The franchisee is also responsible for obtaining all necessary permits, certificates, and licenses required to operate the restaurant. This includes business licenses, health certificates, sales tax permits, and fire clearances.
The franchise agreement also states that the franchisee must hold themselves out to the public as an independent contractor operating the business under a franchise from Del Taco. The franchisee cannot act or represent themselves as an agent of Del Taco and does not have the authority to bind or obligate Del Taco in any way. This reinforces the independent nature of the franchisee's business and clarifies that Del Taco is not liable for the franchisee's actions or omissions in the operation of the restaurant.