Staffing in franchises: how to divide responsibilities in Spain

Before franchising a business in Spain, it is worth settling a question that often gets lost among manuals and contracts: who will manage the people working at each outlet? Teaching staff how to serve customers is not the same as organising the team's annual leave. Separating these functions helps build a consistent franchise network without blurring each business's responsibilities.

1. Distinguish brand standards from employee management

The franchisor needs to explain how its business works: service procedures, product knowledge, quality criteria and measures to maintain a consistent appearance. As an independent business owner, the franchisee must organise staffing at its outlet and meet its obligations as an employer.

This distinction should be clear in everyday decisions. Head office can define the checks required to open an outlet correctly; it is for the franchisee to decide which employee carries them out and how they fit into that person's working day. Head office can also flag a shortfall in service, but this oversight should not turn into routine managerial instructions to another business's employees.

The practical rule is to separate the outcome required by the brand from the management of the people who deliver it. To do this, review the following areas:

• Recruitment, pay and termination of employment contracts.
• Shifts, rest breaks, annual leave and cover for absent staff.
• Day-to-day instructions and allocation of tasks.
• Training on the business model.
• Monitoring compliance with commercial standards.

The first three should remain the franchisee's responsibility as the employer of its staff. The last two require coordination, without transferring that responsibility.

2. Set out the division of responsibilities in the contract and manual

Article 62 of Spain's Law 7/1996 on Retail Trade and Royal Decree 201/2010 provide the specific legal framework for franchising in Spain. The Royal Decree identifies the transfer of know-how and ongoing commercial or technical assistance as elements of franchising, without prejudice to any agreed supervisory powers. That assistance does not, in itself, make head office the employer of the franchisee's staff.

The contract should explain that each party is responsible for recruiting and managing its own employees. It is also worth identifying who receives feedback from head office and how it is passed on to the local team.

In the manual, replace instructions addressed to individual employees with procedures and responsibilities for the outlet. For example, rather than stating that ‘head office will allocate the additional shift’, specify that ‘the franchisee will arrange the staffing cover needed to follow the service procedure’.

Article 3 of Royal Decree 201/2010 requires written pre-contractual information that is truthful and not misleading to be supplied at least twenty working days before the contract or preliminary agreement is signed, or before the prospective franchisee makes any payment to the franchisor. If the assistance offered includes scheduling tools or recruitment support, describe its actual scope: providing help is not the same as taking responsibility for employee management.

3. Document staffing needs without promising a fixed formula

When preparing your business model for franchising, turn your experience into guidance on staffing cover, rather than a universal headcount. A team that works well at your outlet may be insufficient at another with longer opening hours or a different pattern of demand.

Document which functions need to be covered at any given time: customer service, preparation, taking payments, replenishing stock or closing up. Then distinguish between tasks that can be combined and those that require people to be present at the same time or to hold specific qualifications.

A useful reference sheet might include:

• The operating period and tasks to be completed.
• The skills needed for each role.
• Circumstances that call for additional staffing cover.
• Operational alternatives for unexpected absences.

Present this sheet as guidance that the franchisee must adapt in line with employment law and the applicable collective agreement. Do not assume that every outlet will fall under the same collective agreement: this must be checked against the relevant business activity and scope of coverage.

4. Establish a supervision channel that respects the employer's role

Designate the franchisee or its manager as head office's usual point of contact. If a visit reveals that a procedure is not being followed, report the issue, the expected standard and the corrective action requested to that contact. Avoid allowing the head office adviser to become, in practice, the local team's day-to-day manager.

Spain's Workers' Statute governs employment relationships and, in Article 43, the unlawful supply of workers. Not all brand supervision amounts to unlawful labour supply, but the way work is actually organised matters more than a clause declaring independence. Obtain a legal review of any arrangement in which one business supplies staff while another effectively performs the employer's functions.

Practical conclusion: before offering your first franchise, draw up a matrix listing each staffing decision, who is responsible for it and the communication channel to use. Then check that matrix against the contract, the manual and head office's day-to-day practices.