For Management Recruiters, how is the Contract Staffing Continuing Fee calculated?
Management_Recruiters Franchise · 2024 FDDAnswer from 2024 FDD Document
ne dollars ($2,000,001.00).
The Contract Staffing Continuing Fee is an amount equal to the sum of 4.5% of Contract Staffing Payroll plus 18% of the Gross Margin for temporary and contract employee staffing of the Franchise Business. Contract Staffing Payroll means any gross wages funded by Hire Quest, L.L.C. or its affiliates on your behalf with respect to the temporary and contract employees.
- The Recruiter Continuing Fees are deducted from your Net Cash In account as part of the weekly calculation of the Franchisee's Recruiter Share. Net Cash In means sums billed by Franchisor to customers of the Franchise Business on account of Recruiter Services which are actually collected less only sales and use taxes collected for payment to the relevant taxing authority. Net Cash In also includes all receipts of your receipts from any business in which you engage in violation of any obligation in the Franchise Agreement. As long as your Franchise Agreement remains in effect and you are not in default, we will pay you your Franchisee's Recruiter Share on the Wednesday following the weekly Accounting Period (which ends on a Sunday) during which the Franchisor actually collects the cash. If that Wednesday is a banking holiday, then we will pay to you your Franchisee's Recruiter Share on the next business banking day. See
Section 5 and Section 6 of the Franchise Agreement for a detailed discussion of the calculation of your Franchisee's Recruiter Share
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- The Contract Staffing Continuing Fees are deducted from your Gross Margin account as part of the weekly calculation of Franchisee's Contract Staffing Share. Gross Margin means sums billed by Franchisor to customers of the Franchise Business on account of temporary and contract employee placement services after deducting therefrom all Temporary and Contract Employee Expenses attributable to the temporary and contract employees.
Source: Item 6 — OTHER FEES (FDD pages 16–23)
What This Means (2024 FDD)
According to Management Recruiters' 2024 Franchise Disclosure Document, the Contract Staffing Continuing Fee is the sum of 4.5% of Contract Staffing Payroll plus 18% of the Gross Margin for temporary and contract employee staffing of the Franchise Business. Contract Staffing Payroll refers to the gross wages funded by Hire Quest, L.L.C. or its affiliates on your behalf with respect to the temporary and contract employees. This fee is deducted from your Gross Margin account as part of the weekly calculation of the Franchisee's Contract Staffing Share. Gross Margin is defined as the sums billed by Management Recruiters to customers for temporary and contract employee placement services, minus all Temporary and Contract Employee Expenses attributable to those employees.
Management Recruiters will pay the Franchisee's Contract Staffing Share on the Wednesday following the twenty-ninth (29th) day after the end of each weekly Accounting Period (which ends on Sunday), provided the Franchise Agreement is in effect and the franchisee is not in default. If that Wednesday is a banking holiday, the payment will be made on the next business banking day. For a detailed discussion of the calculation of your Franchisee's Contract Staffing Share, the FDD refers to Section 5 and Section 6 of the Franchise Agreement.
Additionally, if Contract Staffing Receivables remain uncollected for more than 42 days after the invoice date, Management Recruiters franchisees must pay an overdue accounts fee of one-half percent (1/2%) of the amount of the uncollected receivables for each 14 day period following the 42 Day Period. Franchisees are also responsible for a Marketing and Public Relations Fee of 0.5% of Gross Funds, which includes billings from temporary and contract staffing services and all Net Cash In. This fee is deducted weekly from the Franchisee's Recruiter Share and Franchisee's Contract Staffing Share.