The Tutors’ Association Public Statement – Tuition franchise and business support disputes.

7th of February, 2025

Background

It has come to the attention of The Tutors’ Association that there has been an increase in disputes over the last twelve months between individuals purchasing tuition franchises (and becoming ‘franchisees’) and tuition franchises and, in some cases, other suppliers offering high-value services to tuition businesses that have a high minimum price over a long period of time.

Such disputes are often extremely stressful and potentially very damaging to all parties involved. In some cases, they involve TTA members and others do not. In a number of cases, some of the parties are emotionally or financially vulnerable and most of these disputes involve threats of legal action, with differing degrees of legal merit.

The purpose of this statement is:

1. to confirm TTA’s position in relation to tuition franchises;
2. to provide guidance for all franchises, franchisees, tutors, tuition businesses and suppliers in relation to entering long-term agreements with ongoing obligations;
3. to provide guidance on how TTA will interpret its code of practice in relation to such disputes.

TTA’s Position in Relation to Tuition Franchises

TTA is strongly supportive of franchising as a legitimate way for individuals to create, maintain and expand effective tuition businesses within the tuition sector, subject to both the franchisor (who owns and sells the franchises) and the franchisees (the individuals purchasing a franchise marketed and sold by the franchisor) acting properly and fairly in relation to one another and complying in full with our Code of Practice. Franchises are one of a number of legitimate models for tuition businesses to operate. Many franchises have the potential to offer individuals the opportunity to grow profitable businesses relatively quickly.

Reasons to Consider Buying into a Tuition Franchise

There are a number of good and legitimate reasons for why someone would choose to purchase a tuition/education franchise and these can include:

• Access to proprietary content or course materials. Some franchises offer their franchisees substantial content or courses which have been developed over time and tested in a commercial context. This may have considerable value for new franchisees.
• Discounted access to a suite of valuable business tools and services. Some franchises offer comprehensive legal documentation, accounting and marketing services to their franchisees. For franchises operating a physical centre model, they may be well placed to help in the setting up of physical centres. It could be the case that the services being bundled together would be cheaper than purchasing equivalent services for a brand new business (but prospective franchisees should do their research to check if this is the case).
• A well recognised brand and effective marketing campaigns/support. Many franchises supply leads to their franchisees through a national marketing campaign or access to procurement opportunities. A good franchise will be able to give you data on how many leads they generate for franchisees or what marketing they carry out to generate leads. You can check this information by speaking to existing franchisees. Check to ensure that the marketing activity relates to consumer sales and lead generation and not including marketing for the sales of new franchises.

Be cautious when considering new franchises or those where the model is untested or has been substantially changed recently; such franchise opportunities may still be legitimate but are likely to require some development and this may not be suitable for someone who is relatively new to business ownership or franchising. For established franchises, feel free to ask challenging questions such as about instances where franchising hasn’t worked, why this has been the case and how it has been managed.

Prospective franchisees should always consider carefully whether the alternative to franchising is viable and satisfy themselves that what they are getting through the purchase of a franchise represents good value for money compared to what support they could purchase if they set up their own business independently. Franchising can be more or less suitable for individuals depending on their circumstances. Be wary about promises that are not backed by evidence of what actual franchisees have achieved.

Franchise Membership Options with TTA

TTA supports franchises with three possible membership options:

1. Franchise block membership. Under this model, the entire tuition franchise (within a specific jurisdiction) joins TTA and the franchisor pays a block membership fee to TTA which it may or may not collect contributions for from franchisees. The franchisor and each franchisee is treated as a full TTA corporate member and benefits from their TTA membership accordingly.
2. Franchise head office (franchisor) membership. Under this model, the franchisor alone joins TTA as a corporate member and benefits from membership. Franchisees are not included as members and, correspondingly, are not eligible for TTA benefits in this circumstance. Franchises under this model must not mislead the public to suggest that franchisees are themselves TTA members. Franchisees are eligible to purchase TTA membership independently and separately should they wish to do so, and benefit from TTA membership in the normal way.
   Franchisors should not charge franchisees any fee for TTA membership under this model, as the franchisees are not members nor eligible to derive any direct benefit from head office membership, and we would regard it as a breach of our Code of Practice if they were to do so.
3. Independent Franchisee membership. Under this model, franchisees independently join as TTA corporate members and receive the corresponding benefits. The franchisor, and wider franchise, are not eligible for TTA benefits and must not represent themselves to the public as TTA members.

All TTA members are expected to adhere to TTA’s rules, in particular our Code of Practice, which can be found at this link. Members found to be in breach of the Code of Practice can be sanctioned, up to and including (in the most serious cases) the permanent exclusion of an individual or organisation from membership.

It is important to note that tuition is not a regulated sector in the UK and most parts of the world. Individuals and organisations are still free to deliver tuition if they are not members of any professional body. However, TTA’s first strategic objective is: “To set and enforce minimum standards within the tuition sector.”; we actively enforce our Code of Practice to ensure that governments and institutions in the UK and around the world, as well as the wider public, are aware of what it means for an individual or organisation to be a member of TTA and to distinguish those providers who commit to good practice from those that perhaps do not or who, in the worst cases, behave in an unethical or even illegal manner.

Guidance for Franchises, Franchisees, Tutors, Tuition Businesses and Suppliers

Based on complaints and concerns we have received to date, TTA sees fit to issue the following guidance to everyone in the tuition sector:

1. TTA expects all members (as well as suppliers to the tuition sector) to adhere to commitments and assurances they make to clients, tutors or to (other) businesses. Individuals and organisations should act in good faith towards one another and ensure, as far as possible, that they are as clear as is reasonably required on what is expected from each party when entering into agreements.
2. Organisations selling franchises or business support services (including coaching, mentoring and technology support) should be as clear as reasonably possible as to what is included within the services they offer, as well as what is not included but could be purchased later at an additional cost. They should avoid providing conflicting information where possible, especially where what is offered in writing differs significantly (and may be much more restrictive) from what is promised verbally. They should also be especially clear as to any components of their services which are:
   1. Subject to minimum prices, including clarity on how those minimum prices are calculated;
   2. Subject to long-term commitments, and what those commitments are;
   3. Subject to additional costs or fees, and how those fees are calculated (where applicable);
   4. Likely to have an indirect impact on the counterparty (e.g. legally requiring or expecting them to travel or incur additional expenses to third parties);
   5. Intended to create any kind of exclusive relationship or impose restrictions on how they operate.
3. Individuals entering into franchise agreements or purchasing business support services (including coaching, mentoring and technology support) should consider very carefully that such agreements can, in some cases, be difficult or impossible to terminate before the expiry of the term. In particular, TTA would strongly encourage individuals to consider the following advice:
   1. Is the franchise or service offered new or substantially different to what has been offered previously? If so, it may be more risky and it would be highly advisable to ensure that there was a way out of the agreement if the model or service provided does not prove to be as beneficial as originally stated.
   2. Is there a long-term commitment involved and, if so, what is it? Individuals should carefully consider the implications of entering into long-term contractual commitments which can be difficult or costly to terminate before their expiry.
   3. Is there a difference between what is being promised verbally and in writing? This should be a major warning sign and individuals should proceed with extreme caution, if at all, in such circumstances. The written terms of contracts and agreements should align with the promises, assurances and verbal statements of fact given.
   4. What is the total expected and minimum cost of entering into the agreement and can you afford it if it underperforms? If you commit to a minimum monthly fee for a long period of time, for example, this might be a very substantial total cost over the lifetime of the agreement. It could be very difficult to terminate such an agreement if the cost is not justified by the benefit obtained. On the other hand, if the total expected cost is quite modest or limited, e.g. a single one-off purchase with no ongoing commitment, then this might be a very reasonable risk to take. You must ask yourself: can you afford it if this investment underperforms or does not provide as much benefit as expected?
   5. Have you spoken to current or former customers? Do not be afraid to ask for references from organisations selling such services; any legitimate franchise or service provider will be happy to provide references. Ensure that you do your own proportionate due diligence in relation to the size of the commitment you are making. You may not necessarily need to carry out extensive checks if you are purchasing a low-value (e.g. <£200) course or training session but you should very carefully consider what checks would be proportionate if you are committing to spending thousands of pounds.
   6. Have you properly and fully read the relevant agreements or documentation? For any significant investment or commitment, you must ensure that you read the relevant agreement and documentation in full. If you sign an agreement it will be difficult or impossible to change or terminate it later. If you make commitments, you should ensure that you are able to meet those commitments. Do not accept verbal assurances from the counterparty as to what the agreement says and never sign an agreement because the other party is pressuring you to do so before reading it. Be very wary of entering into agreements before you are prepared and comfortable because the seller says you will miss out on some benefit or start date; if the agreement is worth signing for both parties, the opportunity will very likely be available in future. Trustworthy, legitimate sellers will want to ensure you understand what you are committing to and will give you the time to read the document properly.
   7. Consider getting advice from colleagues, associates, TTA or legal professionals. If you are entering into a significant agreement, with substantial obligations perhaps over a long period of time, it would be very sensible to consult trusted colleagues, TTA (if you are a member) or pay for some legal advice before committing. It should be a major warning sign if a seller suggests to you that this is not necessary or tries to encourage you not to check the agreement. Even simply checking the agreement and key obligations using an AI service (e.g. ChatGPT) would be a good first step although you should not enter agreements only on this basis; paying circa. £500 for a consultation with a lawyer could be very worthwhile if you are entering into an agreement which involves tens of thousands of pounds in obligations over several years. Please note: whilst TTA may offer a perspective on an agreement and to what extent its terms seem fair and balanced to us, we are not a legal firm and cannot offer legal advice as to the merits of entering into an agreement or not.
   8. Are they a TTA member? If they are a TTA member they will be required to adhere to our Code of Practice and you will be able to complain to TTA in the event that they act in contravention of our Code of Practice.

Guidance on How TTA Will Interpret Our Code of Practice

In relation to disputes over supplies of services or the purchase of franchises, TTA will refer any formal complaints to our Disciplinary Committee, subject to them meeting the minimum threshold for merit. Formal complaints should be submitted to: complaints@thetutorsassociation.org.uk along with supporting evidence. If you are unsure as to whether you should make a formal complaint, you can email us at this email address in order to arrange an introductory call to discuss a specific case.

TTA can only take action against TTA members; if the individual or organisation you wish to complain about is not a TTA member, we cannot progress your complaint and we will have no jurisdiction over them. However, if you are a TTA member yourself we may be able to offer you some relevant advice, guidance and/or support.

When considering disputes of this nature, TTA’s Disciplinary Committee will consider:

1. To what extent has either party acted in good faith or bad faith? A party acting in bad faith in a negotiation should expect to be treated severely by the Disciplinary Committee both for acting dishonestly (where applicable), deliberately or negligently injuring the business or interests of other members and for bringing the tuition sector and TTA into disrepute. Evidence of this could include:
   1. Providing agreements or amendments to agreements to the other party which do not align with or diverge substantially from prior written or verbal assurances or negotiations.
   2. Where there is an asymmetry in the information available to both parties and the party with the benefit of the advantage makes assurances or promises which are misleading or untrue to the other.
2. To what extent does either party act in a way that any reasonable person would understand is intended to cause harm or damage to the other (whether financial, reputational or other harm) or where such harm is foreseeable to a reasonable person.
3. To what extent are agreements written or negotiated in such a way to provide undue or excessive advantage to one party over another, relevant particularly in cases where there is an asymmetry in resources between the parties negotiating (e.g. where one party is a large company and the other is an individual). This may be negated entirely where there is evidence that both parties had an equal understanding of the legal position of the agreement they were entering into and/or similar access to legal advice.
4. To what extent does either party misrepresent themselves or relevant aspects of their experience, previous employment, business, financial circumstances or capability.
5. To what extent has a party claimed to have made statements or given assurances that are different to those that can be reasonably ascertained to those provided, or does a party claim to have made statements or given assurances that are contrary to statements or assurances it did actually give.
6. To what extent is a party providing false or misleading information or omitting to provide relevant information to the other party in order to induce the counterparty to enter into agreements that it would not (or would be significantly less likely) to enter into.
7. To what extent has a party knowingly taken advantage of an individual in adverse circumstances who is financially, emotionally or mentally vulnerable without taking due precautions.
8. To what extent has a party attempted to apply undue pressure on another to enter into agreements.
9. To what extent has a party misrepresented what it offers to do for the other, the cost of entering into an agreement or the scope of services included in the agreement or available for an additional cost.
10. To what extent is the behaviour of parties, once a dispute arises, reasonable, proportionate and attempts to find an opportunity for reconciliation or resolution? By contrast, the Disciplinary Committee may take a dim view of acts that might reasonably be regarded as unduly threatening, intimidating, manipulative or vexatious.
11. Where agreements are silent on a matter in dispute, to what extent does either party take a reasonable and fair view, including any genuine effort to reach a negotiated resolution for the matter?
12. Where the terms of an agreement are disproportionately unbalanced in favour of the party that offered the agreement on a matter in dispute, to what extent did:
    1. (a) the offeror anticipate that the said terms might be relevant to a future dispute (e.g. if similar disputes had occurred previously), and;
    2. (b) to what extent can it be shown that there was a genuine understanding between both parties on the terms, conditions and their intended operation (demonstrating that both parties freely consented to them), and;
    3. (c) to what extent does the party who is favoured by the terms attempt to penalise the other party.

If you have been affected by any of the issues raised in this statement and are struggling with your mental health, there is support available. You can contact Samaritans on 116 123 (free, 24/7) or reach out to organisations such as Mind (0300 123 3393), Shout (text ‘SHOUT’ to 85258), or CALM (0800 58 58 58) for confidential support.

Public Statement Ends.