Client base - yours or the salon owners?

[Aeyla]

Hi there everyone

New here but I have been in the business for a long time now. For the last 9 years I have rented a room and paid rent to a salon owner in a hair and beauty business.

I have just opened my own beauty salon. The ex-salon owner is after me saying that I cannot take any of the clients I have built up over the years with my hard work. We do not have any written contract of any sorts but she is threatening to sue me as I have contacted my clients and offered them to treat in my own salon, which by the way is not even in the same town but a nearby town 5 miles away!!

Does she have any ground and does anyone know what my rights are?
As I wast paying rent for romm the client base is mine not hers and it is her that should not interfere with my client base - though I have not said that to her as it will create more friction.

Any advice on this would be highly appreciated

Thanks in advance

Aeyla

 

[Ruth Mills]

I read a similar post by someone who was in permanent employment at a salon, and there was a clause in her contract that prevented her from working within an 8 mile radius of that salon for a period of 6 months after terminating her employment. Which I thought was excessive, as it did not (as far as I know) mention anything about treating the existing clients of that salon.

However, in your case, this sounds as though you are self-employed, as you are paying rent to the salon owner for the use of her room. Did she ever take any commission from you, e.g. a percentage of fees taken, or did you just pay a flat rent?

My take on this is that if you are self-employed, and the business arrangement with the salon owner is that you are simply paying rent for the use of a room, then the rights to the clients are yours, on the basis that you are operating as a self-employed person. The fact that there is no written contract should hopefully also weigh in your favour as far as that is concerned.

Suppose, for example, that a company rented office space from someone. Now nobody would expect the landlord of the office space to assert ownership of that company's clients. I can see no difference in your situation either. You are paying the salon owner for the use of a service, namely the room in her salon. But you are in business on your own account.
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[Ruth Mills]

Or, to put it another way...

Have you been paying out for everything in connection with your business, e.g. equipment, products, training, insurance, etc?

If one was in permanent employment with a salon, then one would expect the salon to pay for everything like that; you would just receive a monthly salary, and would probably be paid at a fixed hourly rate, irrespective of how many clients you may or may not have treated during the day.

Whereas, if you own and are financially responsible for your equipment and products, and pay for your own training, insurance, etc, and just pay a flat rate for use of the room in the salon, then it is you who is taking the business risk here; the salon owner would still be owed rent irrespective of if you have been fully booked all week or had no clients at all.

In which case, I would almost certainly expect the courts to be on your side, should she have the sheer audacity to sue you over this.
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[Aeyla]

Or, to put it another way...

Have you been paying out for everything in connection with your business, e.g. equipment, products, training, insurance, etc?

If one was in permanent employment with a salon, then one would expect the salon to pay for everything like that; you would just receive a monthly salary, and would probably be paid at a fixed hourly rate, irrespective of how many clients you may or may not have treated during the day.

Whereas, if you own and are financially responsible for your equipment and products, and pay for your own training, insurance, etc, and just pay a flat rate for use of the room in the salon, then it is you who is taking the business risk here; the salon owner would still be owed rent irrespective of if you have been fully booked all week or had no clients at all.

In which case, I would almost certainly expect the courts to be on your side, should she have the sheer audacity to sue you over this.
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Thanks for taking time and commenting.

I do pay for my own products equipment, training etc and pay her the rent irrespective of how many clients I have or am off on holiday or sick.

And as you said in previous comment I see the clients as mine not hers.

 

[Ruth Mills]

Cool; I would now be inclined to speak to BusinessLink or the Citizens Advice Bureau for more advice on how to proceed; although from what you have said so far, it definitely sounds as though you are self employed and in business on your own account, in which case it would be you who should have the rights to your clients.
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[daisyl]

I agree with Ruth. As you were self employed and under no contract then I would assume they are your clients! Although I am no legal expert.

However, my therapists are all under contract and so have clauses in their contracts re no moonlighting and if they leave they cannot operate within a 10 mile radius for 6 months, which is perfectly acceptable (and the norm). So under those circumstances this would not be ok.

No contract - leaves you free to do as you wish (I would have thought) X

 

[Ruth Mills]

However, my therapists are all under contract and so have clauses in their contracts re no moonlighting and if they leave they cannot operate within a 10 mile radius for 6 months, which is perfectly acceptable (and the norm).

Ah that is interesting to know. When someone yesterday posted that they had a clause which prevented them working within an 8 mile radius for 6 months, I thought that sounded excessive. As in my line of business (IT), such clauses normally just say that you can't work for any of the company's clients for 6 months (meaning that would not stop you getting a job with the IT firm next door if it was not one of your current employer's clients).

But if this is standard procedure, then I guess I stand corrected (although am still not convinced on account of the environmental impact of ex-employees having to drive further to get to their new places of work to ensure they are over 10 miles away from their old workplaces as the crow flies)...
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[tashastalons]

I should think she would have no leg to stand on!

I am currently employed by a salon owner but have no contract with her at all.
I am planning to go selfemployed in a hairdressers less than a mile away and am confident all my clients will follow.
Now I thought this would be absolutly fine, but your post has me thinking!?!?
Could my employer sue me? How would she have any proof that id taken clients? its not exactly poaching if they want to follow and I havent signed a contract.

Good luck wth your new business! and hope your hard work pays off!

xxx

 

[minky]

If you have no written legal contract with her at all ,
then she has no powers over you or any of the customers
the same goes for you too,

if there was no contract
you could open a salon right next door to her and she couldn't do a thing about it , (not that you would want to ) lol x
the law about same trade shops trading in the same vicinity in the UK
went out of force a long time ago ,

the law now allows all trades to open and trade anywhere they like these days
which perhaps is a bit silly when you see two butchers shops trading side by side ect ,

Also without any sort of legal contract signed up
I think its fair to say that you built up your client base
and should hold the data for all your clientele

but as it stands it now, it's soley up to the customer as to where they want to be treated , (hopefully with you)

You could place an advert in the local news saying you have now moved and state where you are so that your loyal clients know where you are and can follow you if they want too hth

Ps there is a salon solicitors on here that can advise you more
but as there was no contract at all you shouldn't really need them :hug:

 

[tashastalons]

Thanks minky!!
Youve really put my mind at ease!!

Actually the unit next door to the salon I work in is up for lease lol so weve all had a joke about that too, Imagine living with that!!

Im not moving far but its far enough lol. xx

 

[pure]

The buiness owner owns the client list, and in this case you are the owner of your buiness therefore you also own your client list. Does the salon owner also offer beauty treatment and did you share a client list?

 

[tog]

I should think she would have no leg to stand on!

I am currently employed by a salon owner but have no contract with her at all.
I am planning to go selfemployed in a hairdressers less than a mile away and am confident all my clients will follow.


xxx

Your employer is breaking the law.
NO CONTRACT!! what sort of employer is she???
you can go off and do exactly what you like, whenever you like, without giving her any notice.
But likewise as things stand she can get rid of you whenever she likes.
I wouldn't stay there long if I were you, who knows what other laws she might be breaking . . . health and safety, minimum wage legislation, employers and public liability insurance etc etc.
I wouldn't wait to find out!

 

[angelina221]

A contract doesn't need not be in writing. As long as you and your employer have agreed the terms and conditions of your employment.

 

[Aeyla]

Thanks for the input all

Helped to allay my worries. I think her threat to sue was more posturing and maybe frighten other staff and self employed in her salon.

Thanks for wishing me luck - was my first day yesterday and was better than I thought.

Aeyla

 

[YSL]

Please take note of angelina's warning- whilst the employment legislation requires a statement of terms to be issued, its absence does not automatically mean an absence of obligations between employer and employee (I appreciate this is not quite your example but the thread seems to have developed dangerously and I wanted to put this straight). Active solicitation of clients will place any ex employee in a situation where they may force the former employer to take action and, frankly, whether you are in the right or not this should always be avoided.

I would also suggest that the 10 mile radius suggested above is not the norm. Of the 200 odd salons we help I haven't seen something so broad unless it is a provincial salon where the nearest threat/ competition is over 5 miles away.

Turning to your specific point Aeyla I think the posters are generally right- both you and the salon have previously acted as if you are self employed and therefore the client base is not exclusive to the salon. If the salon wants to threaten you then let them try0- it would be interesting to see what argument their lawyers might suggest!

Best of luck

 

[daisyl]

Hi Julian

Our contracts were drawn up by a firm of local solicitors (good reputation).

Your comments ref 10 mile radius have now got me concerned. I was lead to believe this was standard, but from what you say - not the case? My concerns now are how accurate is the rest of the contract terms!

 

[VHunter]

My question is this:
If the technician has said "I won't be here anymore as of xyz date" and left it at that, and the client says 'where are you going" and the tech answers, and the client decides to follow... even if there is a written agreement in place.... What then?

After all, clients aren't property. They are people. Zellers department store isn't yelling because Wallmart 'stole' their clients. If Zellers offers a better sale on a certain item, Walmart can't take them to court.
OR if Wallmart has a better return policy, same thing.

So, if the tech did a mailing, that INCLUDED but wasn't exclusively sent to, the existing client base; advertising her new place of business and any promos....

:?:

 

[YSL]

Victoria- if I was the technician in that instance I am afraid I would simply state that her contract bars her from advising the client of that information. If the Client made their own way to the new salon then thats fine. At the end of the day (even though under notice) the technician is still employed by the original salon and so owes a duty to that same salon.

Daisy- the problem we have found is that firms often draw up contracts without looking specifically at the industry. This is not a criticism as not every law firm wants to restrict itself in this way. I think the peculiarities of hair (rather than beauty or spa which might get away with slightly larger geographical restrictions) is that there tend to be a few salons situated in one place so it becomes overly restrictive to ban salons outside this immediate area. The UK's largest group, for example, has 6 months for 1/2 mile....

 

[persianista]

My staff contracts are all 1/2 a mile for 6 months. I was advised that anything beyond that was unenforcable.
I came across this scenario a few years ago with a room renter. She openly told MY clients that she was setting up at home to save paying rent. They all tried it out. In the end they pretty much all came back to my salon because its more convenient than sitting in someones front room.
I never rented a room since and all therapists are employees. (plus a bit more honest)
The snide ex-room renter even had the cheek to try and grovel her way back in saying her conduct was "just business"
Please treat people as you wish to be treated.

 

[VHunter]

I have a very hard time wrapping my head around this "6mile radius" and all that.
Especially if someone was 'renting' space.
For the simple reason that it's the technician/hairdresser that the client wants and not necessarily the space itself.

I personally chose my hairdresser for her skills and NOT her space. I couldn't give a rat's butt what the salon looks like, as long as she does my hair properly and I'll go anywhere she goes. If EVER she leaves that salon, I don't care what it takes, SHE'S doing my hair and no one else since EVERYBODY ELSE has always botched it. (not everyone can layer hair as long as mine is, properly)
Heck, if I had to wash my own hair before going to her, and she had to do my hair on her front lawn,I'd STILL go. All I need is the right cut, I don't need the fanfare.

I'm sure some clients are particular about space, but what usually keeps them coming back is the tech's skill and not the surroundings.
The salon owner doesn't own the 'skill' that brought these clients back repeatedly.

I guess the lesson is, don't sign a contract with that sort of stipulation, or make a verbal agreement of that kind.