After the Spray Net Franchise Agreement expires, can the franchisee solicit employees to discontinue employment?
Spray_Net Franchise · 2025 FDDAnswer from 2025 FDD Document
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- During the Term of the Franchise Agreement and this Guaranty. During the term of the Franchise Agreement and this Personal Guaranty, each of the undersigned may not, directly or indirectly, for themselves or through, on behalf of, or in conjunction with any other person, partnership or corporation:
- 1.2. Subject to and as permitted by applicable law, employ or seek to employ any person who is at that time employed by Franchisor, Franchisor's affiliates or any other System franchisee, or otherwise directly or indirectly induce or seek to induce such person to leave his or her employment thereat; or Divert or attempt to divert business or customers of any Franchisee-owned Franchised Businesses to any competitor,
Source: Item 23 — RECEIPTS (FDD pages 75–219)
What This Means (2025 FDD)
According to the 2025 Spray Net Franchise Disclosure Document, after the franchise agreement expires, a franchisee is restricted from soliciting employees to leave their employment. Specifically, for a period of two years after the expiration, nonrenewal, transfer, or termination of the agreement, the franchisee (including their principals, owners, guarantors, and immediate family members) cannot directly or indirectly induce or seek to induce any person employed by Spray Net, its affiliates, or any other Spray Net franchisee to leave their employment. This restriction applies regardless of the cause of termination or expiration of the agreement.
This provision is designed to protect Spray Net's network and prevent franchisees from poaching valuable employees to gain an unfair competitive advantage. It ensures that franchisees who leave the system do not disrupt the operations of existing franchises or the franchisor by taking away trained staff. The restriction extends not only to direct solicitation but also to indirect attempts to encourage employees to leave.
For a prospective Spray Net franchisee, this means that upon exiting the franchise system, they must avoid any actions that could be interpreted as actively recruiting or encouraging current Spray Net employees to discontinue their employment. This includes direct offers of employment, as well as indirect suggestions or incentives that might lead an employee to leave. Failure to comply with this restriction could result in legal action by Spray Net to enforce the non-solicitation clause.
It is important for franchisees to understand the scope and duration of this restriction to avoid potential legal issues after the franchise agreement ends. Franchisees should consult with legal counsel to ensure they fully understand their obligations and how to comply with the non-solicitation clause.