Who is responsible for the terms of employment and compensation of employees at a Hyper Kidz Business?

According to Hyper Kidz's 2024 Franchise Disclosure Document, the franchisee is exclusively responsible for the terms of employment and compensation of their employees. Specifically, the franchisee is the sole employer and is responsible for hiring, setting schedules, establishing compensation rates, and paying all salaries, benefits, and employment-related liabilities such as workers' compensation, payroll taxes, Social Security, and unemployment insurance. The franchisee also has the sole ability to discipline or terminate employees. Hyper Kidz's minimum staffing requirements are solely to ensure the business operates in accordance with the System standards. Franchisees can staff the Hyper Kidz Business with as many employees as they desire, provided they meet the minimum staffing levels.

Hyper Kidz may provide recommendations regarding salaries, hourly wages, or other compensation, but the franchisee is free to disregard these suggestions. Any training that Hyper Kidz provides to the franchisee's employees is intended to educate them on the procedures, protocols, systems, and operations of the Hyper Kidz Business and does not imply an employment relationship between Hyper Kidz and the employees. The franchisee also agrees to assist Hyper Kidz in defending against any claims that Hyper Kidz is the employer, joint employer, or co-employer of the franchisee's employees.

This arrangement is typical in franchising, where franchisees are independent business owners. It is important for prospective Hyper Kidz franchisees to understand that they bear the full responsibility for managing their employees and complying with all applicable employment laws. Franchisees also handle background checks of prospective employees, and cannot hire anyone with a history of violence, dishonesty, or crimes against children. This includes all costs and liabilities associated with employment, which can be a significant expense. Franchisees should carefully consider these factors when evaluating the Hyper Kidz franchise opportunity.