As a Gokhale Method franchisee, am I considered an independent contractor?
Gokhale_Method Franchise · 2024 FDDAnswer from 2024 FDD Document
| Gokhale Method Institute, Inc. | FRANCHISEE [IF ENTITY] |
|---|---|
| By: Title: Dated: | By: Title: Dated: |
| FRANCHISEE [IF INDIVIDUAL[S]] | |
| By: Dated: | |
| By: Dated: | |
| By: Dated: |
| The Gokhale Method, Inc. Franchise Agreement between | ("Franchisee" or "You") |
|---|---|
| and Gokhale Method, Inc. (the "Franchisor") dated | (the "Agreement") shall be amended by the |
| addition of the following language, which shall be | considered an integral part of the Agreement (the |
| "Amendment"): |
You covenant that, except as otherwise approved in writing by us, you shall not, within a 10-mile radius of your former Location or of any location then existing where the Gokhale Method is taught, and for a continuous, uninterrupted period of two (2) years following the end of our relationship with you, whether by termination, expiration or otherwise, either directly or indirectly own, maintain, operate, engage in, be employed by, provide assistance to, or have any interest in (as owner or otherwise) any Competitive Business.
Source: Item 22 — CONTRACTS (FDD page 34)
What This Means (2024 FDD)
The 2024 Gokhale Method Franchise Disclosure Document does not explicitly state whether a franchisee is considered an independent contractor. However, the document includes a table indicating the signatures of both the franchisor and the franchisee on the franchise agreement, suggesting a contractual relationship between two distinct parties. Additionally, the document refers to the franchisee as "you" in various clauses, further implying a separate entity from Gokhale Method Institute, Inc.
Several clauses within the franchise agreement outline restrictions and obligations typically associated with independent business owners rather than employees. For example, there are post-term covenants that restrict a franchisee's activities after the termination of the franchise agreement. These covenants prevent the franchisee from engaging in competitive businesses within a specific radius of their former location or any existing Gokhale Method location for a defined period.
While the FDD doesn't use the specific term "independent contractor," the overall structure of the franchise agreement, with its mutual obligations, restrictions on competitive activities, and separate signature lines, points toward a franchisor-franchisee relationship that is commonly structured as an independent contractor arrangement. A prospective franchisee should seek clarification from Gokhale Method regarding their specific classification and the implications for tax and legal purposes.