Is the franchisee considered an independent contractor under the Hyper Kidz agreement?
Hyper_Kidz Franchise · 2024 FDDAnswer from 2024 FDD Document
day control over all operations, activities and elements of your business, and that under no circumstance shall we do so or be deemed to do so. You further acknowledge and agree, and will never claim otherwise, that the various restrictions, prohibitions, specifications and procedures of the System which you are required to comply with under this Agreement, whether set forth in our Manual or otherwise, do not directly or indirectly constitute, suggest, infer or imply
that we control any aspect or element of the day-to-day operations of your business, which you alone control, but only constitute standards you must adhere to when exercising your control of the day-to-day operations of your business.
14.2 During the term of this Agreement, you shall hold yourself out to the public as an independent contractor 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 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 Hyper Kidz Business 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.
Source: Item 23 — RECEIPTS (FDD pages 52–205)
What This Means (2024 FDD)
According to Hyper Kidz's 2024 Franchise Disclosure Document, franchisees are considered independent contractors. The agreement stipulates that franchisees must present themselves to the public as independent contractors operating under the rights granted by Hyper Kidz. This includes displaying a notice of independent ownership on business premises, letterheads, business cards, and forms, with Hyper Kidz reserving the right to specify the content and form of such notice.
Hyper Kidz emphasizes that franchisees have sole responsibility for all obligations arising from their business operations, including the payment of all applicable taxes. Franchisees must also clearly indicate the independent ownership of their business in all public records and relationships with other persons, ensuring that their operations are separate and distinct from Hyper Kidz's operations.
Furthermore, the training provided by Hyper Kidz to franchisee employees is intended to impart the procedures, protocols, systems, and operations of a Hyper Kidz Business, and does not create any employment relationship between Hyper Kidz and the franchisee's employees. The franchisee agrees to defend Hyper Kidz against any claims asserting that Hyper Kidz is an employer, joint employer, or co-employer of the franchisee's employees, including providing assistance and testimony in any related investigations or proceedings. The success of the Hyper Kidz business depends on the franchisee's ability as an independent businessperson, and Hyper Kidz disclaims any warranties or guarantees regarding the potential volume, profits, or success of the business venture.