Franchisors and Franchisee Agreements can be quite complex in nature and can have a wellbeing and mental health clause in the contract. The anxiety and stress around launching something new, upscaling something current, and then monitoring mental health and its impact on the success of a franchisee and their agreement is very important to the overarching brand and business. The wellbeing clause is an out for both the franchisor and the franchisee for very good reasons.


When is mental ill health an excuse to get out of the contract?
When is it genuine, performance orientated or when reputation of the brand is potentially affected?

It’s fairly normal in any business for anxiety, workload and the pressure of the unknown to take its toll. What isn’t normal or usual, but perhaps should be are smart dispute resolution strategies, upfront.

The best response to anything that arises in business is to take the time to pro-actively deal with the situation. No-one wins when disputes and mental health issues simply get ignored. The outcome of choosing to spend time dealing with such problems, is that it builds the relationship and the business for both the franchisee and franchisee. It results in stronger franchises, more vested franchisees, and better outcomes for all.

The Franchise Code requires mediation before litigation. Mediation provides a platform for both to have their concerns heard in a way that litigation and court could never offer. Both parties have equal time to share their concerns confidentially, with the view to coming to an agreement to overcome the concerns and being empowered to get on with business quicker with less damage.

The process begins with Franchisee to Franchisor negotiation. However, if disputes aren’t getting sorted, the dispute can move to mediation for delicate or awkward situations and conversations to occur while avoiding escalation. If the dispute is still not resolved, arbitration will be considered before litigation.

The desired outcome is…

Franchisors want happy, engaged, focused franchisees.

Franchisees want a thriving business with support from the franchisor.

SHAW Mediation Australia have 30 mediators and arbitrators nationally, available to assist you in moving through each stage of dispute resolution process, always with a view to finding solutions and resolutions in the best possible way. Let’s Talk!