After the Fitstop agreement terminates, is a franchisee allowed to employ someone employed by Fitstop or another franchisee without prior written consent?
Fitstop Franchise · 2024 FDDAnswer from 2024 FDD Document
- 18.3.2 Without our prior written consent, you shall not employ or seek to employ any person who is at the time employed by us, any of our subsidiaries, or any person who is at the time operating a Franchise or otherwise induce, directly or indirectly, such person to leave such employment.
This paragraph shall not be violated if such person has left the employment of any of the foregoing parties for a period in excess of 180 calendar days;
Source: Item 23 — RECEIPTS (FDD pages 50–135)
What This Means (2024 FDD)
According to Fitstop's 2024 Franchise Disclosure Document, even after the franchise agreement terminates, a franchisee faces restrictions on employing individuals connected to the Fitstop system. Specifically, a former franchisee cannot, without Fitstop's prior written consent, employ or attempt to employ anyone who is currently employed by Fitstop, its subsidiaries, or another Fitstop franchisee. Furthermore, they cannot directly or indirectly induce such a person to leave their current employment.
However, this restriction has a time limit. The agreement states that the restriction does not apply if the person has already left their employment with Fitstop or another franchisee for more than 180 calendar days. This means that after this 180-day period, a former Fitstop franchisee is free to employ such individuals without needing Fitstop's consent.
This clause is designed to protect Fitstop's workforce and the stability of its franchise network by preventing franchisees from poaching employees or staff from other locations or from the parent company. It is a fairly standard clause in franchise agreements, intended to maintain the integrity of the franchise system. Prospective franchisees should be aware of this restriction as it could impact their ability to recruit experienced staff familiar with the Fitstop system after their franchise agreement ends.