Jun
A Salon Owner’s Guide to Booth Rental Contracts
Did you dream of owning a salon only to wake up to the nightmare of dealing with a booth renter who is making your life hell? She refuses to fold the towels, doesn’t sell retail because she’s an “Artist”, keeps asking when you are going to do some advertising and reminds you constantly that you can’t tell her what to do because she’s an independent contractor.
All of this stomach-churning drama could be avoided if you had a contract. Not just a “we agree to 2 weeks notice before you leave” contract, but a agreement that outlines standards of expected behavior. tag
An agreement between you and your stylists outlining where your salon is headed and what your stylists need to do to go there with you. I know that the basis of independent contracting is that you are simply renting a space for a stylist to work in and that you have no say in how that business is conducted, but I contend that you do have a say.
Your name is on the door, your house is mortgaged to keep the lights on and it’s your vision that is driving you to open the door everyday. You have a right to determine how your stylists will look and act, because it is ultimately your business. Your clients don’t know or care what the working arrangement is, they only know what their experience is and you have a responsibility to make sure it’s the right one. An agreement can ensure that you are working to create the salon of your dreams, with stylists who don’t give you nightmares.
What kinds of things should be addressed in your contract?
1. Dress Code – Wouldn’t it be nice if everybody came to work looking like they worked in the salon industry, with their hair and makeup done and in nice, stylish clothes? No more sloppy ponytails, ripped jeans or flip-flops. Outline what your expected style of dress is, and what you consider to be unacceptable. Be specific – this can be a slippery slope and with a little bit of latitude, people start showing up in clothes better suited for mowing the lawn.
2. Absences and No-Shows – What happens if stylists are going to be late or miss work? Who’s responsibility is it to reschedule their clients? I have a salon where one stylist regularly didn’t show up and didn’t ever call his clients. The rest of the salon was left to deal with his angry, sometimes teary clients arriving for their scheduled appointments only to be told that he wasn’t there. Not fair to the clients and certainly not fair to everybody else in the salon.
3. Salon Events – What is your expectation of stylist participation in salon events like open houses and charity evenings? Would you like everyone to show up and help out? Is that a requirement for working there? I know of one salon that hosts monthly art openings - all of the stylists are on-hand for each and every one.
4. Retail – What about retail sales? Would you like your stylists to sell some? How much? What happens if they don’t? What incentives are you going to offer? Are you going to pay commission or offer a rebate on booth rent? Is retail commission negotiable?
5. Distribution of duties - Who is responsible for helping with the towels? If you don’t have a receptionist, who’s job is it to greet the customers and answer the phones? I go into too many salons where clients are not greeted at all and the salon is littered with empty coffee cups and trash because the salon owner is too busy to do it all and none of the renters feel a need to step up and help out.
6. Staff meetings - Do your meetings turn into screaming matches? Does anybody even show up? Make this part of your agreement and you too can have healthy, productive meetings.
7. Education – Will your stylists be expected to attend? Who is going to pay for it? How would you like them to act while they are there? Yours isn’t the only salon where I have been told how important education is to you, only to have two people show up to my class.
8. In-Salon Conduct – What kind of conversations and actions are appropriate in front of clients? Would you prefer that food and drinks stayed in the backroom? How clean would you like the stations to be? What are the consequences for inappropriate behavior?
Anything else that is important to you and your vision of a peaceful, successful salon needs to be included in your agreement. Salon Owners who have never had a contract and are having difficulties with their stylists often tell me that they will have a walkout if they try to push for a standard of conduct agreement. Well, you may lose a stylist or two, but they probably need to go anyway – this may just be the final push out the door.
I understand the economics of empty chairs, but what is your peace of mind worth?
I also believe that if you are true to your vision and are creating something that people want to be a part of, you will have no problem getting the stylists you want to keep and move forward with to sign your agreement.
One final note – I’m not a lawyer or a tax attorney. As the laws vary from state to state, you may want to seek the advice of one of these professionals if you have questions about your stylist agreement.
Update - In response to the many requests I’ve received for a booth rental contract, I’ve put together a guide to help you write a contract for your own salon.
Rather than being the kind of contract that bullies your booth renters into folding towels and washing color bowls, this contract is designed to resolve existing problems and prevent new ones from becoming stomach-churning drama by bringing the entire salon together to craft standards that everyone agrees to abide by. The package includes a guide for salon owners, worksheets and a sample contract. In less than a week, you can be on your way to having the salon you dreamed of rather than the constant source of stress that renegade booth renters can transform your place into.
hello i need a rental contract for my salon, can you help me?
July 1st, 2008 at 12:50 pmI am thinking about purchasing a local salon with a partner. My business partner has been friends for a long time with the employees. I am of the thought that some of these stylists need to go and because of her “personal” connection, she says she can’t do it. I think a meeting is in order to discuss with the current employees/stylists that there will soon be a new owner and what the policies will be, what the new rates will be (meaning whether the stylists will continue receiving a percentage or whether we will go to a monthly rent policy), and let it be known if they are not willing to make this change and turn this very quickly failing salon into what it should be, then there’s the door, so to speak. Where can I get a rental contract and how do I find out what the going rental rates are in my area? The salon carries 8 stylists stations, two manicurists stations and one pedicure chair. A lot of things you have mentioned in this article are the same ideas I have had. Thank you so much I very much enjoyed reading this.
November 3rd, 2008 at 5:30 pmMy saloon just opene and I already have a stylists that is disruptive to the flow of business. I am the salon’s manager and I want to fire her but the owner will not give me the authorization to. What do you recommend I do?
January 14th, 2009 at 11:47 ami have three girls renting from me. a forth just started.i offer the shampoo/con for back bar. in the passed if we ran out who ever saw we were out would replace it and then would take the money out of the rent. that was fine and i thought fare. but now there buying the sham/con when there still full bottles and taking it out of the rent and so is the new girl. i don’t want to start any uncomfortable feelings but i feel i’m being taking advantage of. i’ve always been fare and let it go in the pass, but only because we were out. that’s not the case anymore. how should i approach this without any bad feelings?
January 21st, 2009 at 11:22 amChelsea,
February 7th, 2009 at 11:40 amI am likewise not a lawyer but unlike others looking here, i am also not in the hair styling business. My interest here comes about because a friend of mine is in a chair rental situation with a salon owner who seems to be of the same mindset as you . That being that because your name is on the door, you call the shots, except that she didn’t put everything in the contract that she is now trying to enforce. You are correct if all those rules are mutually agreed upon before the lease is signed, however after that point, it is a binding contract that requires approval from both parties in order to make changes. It is my experience that the person with the name on the door often feels slighted because they forgot to cover themselves with all the correct protection and after the fact tries to muscle through a change.. Well that’s not the way it works, and I hope that’s the biggest thing people take away from your story…. Also.. All contracts must have built in equivalency exchange, in other words, if I am paid a certain amount of money, but it can be shown that i didn’t supply that amount of services, then I could be found to be in breach of contract because I’m not holding up my end of the bargain. The bottom line is that if you want to truly have the priviledges of a boss, then hire your people as employees. If you don’t want to be the boss, then you better have a lease agreement that spells out EVERY detail of what you expect of your stylists… Of course you’ll know if you are unreasonable because no one will sign the contracts….
I have purchased a business and kept the old owner BIG MISTAKE! We can a legal agreement of 2 months notice to evict her, but she is making it hell! I caught he saying she is the owner and stealing new clients! How can i get rid of her faster!!
March 10th, 2009 at 1:07 pmThe countless aspects of running an efficient salon can become very frustrating for Salon owners and managers, especially those who utilize booth rental options. In response to Andy Parker’s post: the most important fact to note is that the IRS clearly defines Independent Contractors (booth renters) as employees. In order to run a salon, a salon owner must have both a license from the municipality in which it is located, and a license from the state level cosmetology board, often termed “state board.” With these licenses, it is the salon owner’s responsibility to abide by the countless rules and stipulations in place by both of these government agency’s. In order to ensure these rules are followed correctly, salon owners have reasonable authority, by law, to require renters to follow policies and rules. It is these policies and rules that allow a business to be ran efficiently. Furthermore, the salon owner either own’s or leases both the physical location and the ‘business’ in which they are renting space. With that said, they have the authority to enforce any non-lease related stipulations that they wish. The only problem with enforcement that may not be legitimate regards physical space allocation and the insurance that the salon owner ensures all that all necessary utilities for providing services are made available for the renter to successfully execute their services.
Most simplistically stated: (unless otherwise noted in an agreement) the Salon Owner has any and all authority over independent contractors as statutory employee’s (also known as Independent Contractors) in regard to any aspect of how the salon is operated. The only thing that they cannot do is to deprive the stylist of what they need to do their job.
All of this is not to say that special contracts should not be written, as they should. Most importantly, these contracts should be signed into effect upon “hiring” or leasing to a renter.
To close, consider this example:
Say that you are an antique collector and that you have chosen to rent a space at a local flea market to peddle your chosen pieces. You go to the flea market administration and fill out the necessary forms and pay your rent. Lets say that you decided that you would need the space for 3 months.
You begin your antique business, and things are good. You keep the space organized, and your sells are satisfactory. The only problem is that you have to walk almost a half a mile form the parking lot to your space. It’s March, and it has been raining frequently, so you decide to drive right up to your space instead of parking in the parking lot.
There was nothing written in your lease agreement of the space about parking, so you decide you can park there everyday, not considering the fact that your car is blocking the entrance of another leaser, and could potentially be a violation of the flea market’s insurance policy.
Flea market administration now send you a letter saying you cannot park your car in front of your space. Just as a salon owner, the flea market’s owner owns the premises in which you are leasing, you are not leasing the parking lot.
The owner has every right to enforce this. You are inhibiting an efficiently ran business.
A lot of these is common sense. If it seems careless, or lazy, or wrongly advantageous, refrain from doing it all together. Then, there will be no problems.
As for credentials, I am a 3rd year Law student at the University of Georgia, will graduate this coming semester. I have managed and been partner in the salon industry for 5 years.
April 2nd, 2009 at 5:23 pmI have owned a small salon for four years i have three booth renters. I have a contract and agree with haveing them . My mistake is allowing them to sell their own retail instead of cutting them a percent of what they sell from the salons retail. Now i realized that i made a huge mistake and i need to change how we retail. I am soon getting more hairdressers so i need to know what is the best way to change how i do my retail in my contract with out losing my girls my contract allows me to change when needed ..any advice
April 26th, 2009 at 6:24 pmHi, cool post. I have been wondering about this topic,so thanks for writing.
June 4th, 2009 at 7:33 amMy daughter rents a chair at a salon where there is no contract. The owner recently posted a list of of duties that includes everything except washing the walls and ceiling to be divided among the renters. She also told the receptionist to only answer the phone and not to help the girls because it will spoil them. The owner said she doesn’t have to help sweep, clean fold etc. because she does things behind the scene. She charges the highest rent in the area and I think she is totally out of line. What is normally expected of a renter?
June 17th, 2009 at 5:35 am@Debbie –
June 17th, 2009 at 9:24 amIf the salon owner’s list of demands is new, I agree that she is probably out of line. At the very least she isn’t behaving very professionally, because there would have been nicer ways to get that stuff done. In my experience, owners tend to post a sign (instead of having a staff meeting or just a discussion) when she’s fed up with how things are working (or not working).
Could your daughter approach the owner about having a civilized staff meeting to discuss distribution of duties? It sounds like there are some things that need to be addressed. It’s important that the staff approach her without ganging up on her, though. The owner is going be defensive and will try to justify hanging the sign instead of talking to them. The stylists need to be ready to hear what she has to say. Good luck – let me know how it turns out.
I’m on the other end of this spectrum. I’m a 46 year old woman that just graduated in April. My owner is 33 and just took over the salon the day I started. How do you try and build clientele when the owner is competeing for the same business? She is constantly on the phone, and when she’s not, she hangs on to it. She promotes no one except herself, and say’s it our responsibility because we’re contractors. I understand the drama that may happen with stylists, but some of these owners need to get a clue. She now wants to raise the chair rent because she realizes with this economy, its not the money maker she thought it was. I spent $2000 getting ready to rent my chair and we’re a one horse town. I bought all my own things. Not to mention that no one in the salon besides myself, does facials, manicures (my own equipment), pedicure (my own equipment), and in 2 weeks I will have my massage license. I have 100 tubes of color, and at least 4 perms on hand at all times. You should see the towels. I’m so embarrased that I bring my own for pedicures and manicures. I’m physically ill and always wondering if I’m going to be pushed out because she has no money. The only thing I use of hers are the towels and utilities, that’s it. So I feel it goes both ways. What is the rule about walk-ins when you and the owner are both new? Help!
August 6th, 2009 at 12:03 amI am a booth rental, but feel I am ran over a little to much. The owner does nothing. I have been working at this salon for over a year. I pay for my lease each week. Our own keeps the A.C. on 85. I live in Texas it is 100 here. My clients is always asking what is wrong. I have messed with the A.C. and the owner got mad. Said that is not include with my lease and if I mess with is again than our lease will have to go up more. I also get cleaning stuff such as hand soap, detergent, paper towels, toilet paper, cleaning stuff, and ect. I have made notes for her to get it, but she “forgets” if I or the other girls doesn’t the client would do without and the shop would be gross. The owner has never folded towels once that I have been there. We do everything there. She also tells us to finsh her clients couple of time and we never get paid for it. What is normally expected of a renter?
August 12th, 2009 at 3:55 pmrachel… oh my goodness that is not right !!! i think your owner is nutts…she is just asking you girls to leave…and almost asking your clients to never come back… i would be looking for a new shop..it sounds like she lost her passion for this beauty industry…i am a salon owner .. i do get behind sometimes on the towels or cleaning supplies but i make a good effert.. but you hvae to try yourhardest to keep things looking great for the clients that even means keeping the hairdressers happy with you so the clients are happy…
August 19th, 2009 at 6:39 pmWe owned a salon for many years and sold it. I work there still as an independent contractor, yet the new owner is gradually replacing the departing hairdressers with commission employees. I have always worked very long days and keep my station clean and my extensive clientele happy and am happy to be done with the management part of the business. The new owner bought a computer with a salon program on it, and has included nearly all of my clients on this program. Yet since I am independent, she does not allow me access, only her young new employees. I just realized this and now I either want MY clients removed from her computer OR to have access my clients since they are already on it. My question really is, are my clients mine or those of the new owner?
August 20th, 2009 at 3:57 pmI am about to open a salon and am have a question about what I am to supply Do I supply chairs for the booths and do I supply every booth renter a key
November 16th, 2009 at 8:22 amI am at my wits end. I have 7 booth rent stylist that always want to advertise (i pay for it) yet they work 18 hrs a week, no one is there to get the new business. I pay for everything except color and 2 girls are doing 30% until it reaches full rent(i never make them pay over rent price) yet next week they go to vegas and they pay nothing. I am so tired of baby sitting them. For the first time I feel like I am not in control of the shop. I believe i need to let 2 of them go. They do not have a contract (they cried when i typed one out,,didnt make them sign it then) is it legal to let booth renters go? and how long do i give them, plus they all have keys, how do I make sure they don’t come in at 3 am and steal
November 18th, 2009 at 7:21 pmI just took over a salon that has been running for many years I myself rented a booth for 12 years out of the salon the old owner wanted to move and that when I saw the opportunity to start my own . I am in need of 2 stylist and a nail tech in San Antonio TX if anyone is interested contact me at hairageoussa@gmail.com
November 20th, 2009 at 2:18 amI am an operator and have rented from a few different owners so I feel that I know how bad some owners can be not caring for their stylist . I would like to create a salon family that is willing to help make the salon OURS not just mine.
Get the locks re keyed at lowes or home depot very inexpensive .
November 20th, 2009 at 2:20 amIm a new salon owner myself and have a semi partner with 2 renters and one more on the way. As this is my second year in business Im noticing a breakdown in managment. i have taken responibilty for this and am looking for the best action to take. We work with no contract and Im having trouble as my partner is at fault for setting bad examples as well as myself. How do I fix the problems without making it seem like Im taking over, and I dont beleive she has any interest in changing some of her behaviors?
January 16th, 2010 at 6:18 pmI have a renter that I recently gave 30 days notice to. She has keys to the salon/spa with a “key holder agreement” and no where in the lease nor in the key holder agreement does it say anything about when or how to get my keys back. As the owner I feel I can ask anyone to return my keys at any time ESPECIALLY if I have given her 30-days notice. I have waited 1 week get my keys back and she has disappeared! I gave her notice in writing via email to have a paper trail. After sending 2 emails and a voice mail she has yet to contact me or show up at the spa! Her stuff is still there…? At this point I am thinking of filing a police report. We have an alarm and I will change the code, however this whole thing makes me uneasy. Help! Can I demand my key back before her 30-days is up? Because she has basically blown me off should I file a police report? Is she going to come into the salon and go postal?
February 5th, 2010 at 10:49 pmI am about to rent a station for 2 owners. I would like to sell some hair products as well as hair accessories ect.
February 11th, 2010 at 6:52 pmIts ok per the owners what type of license do I need?
Cimone
I am sorry I miss typed; I am about to rent a station from two owners, would I need a sellers permit or retail and whats the difference.
February 11th, 2010 at 7:03 pmI own a salon where most of the stylists are booth rental. We are doing alot of fundraising events for local charities and I want to close our salon to regular clients so that the stylists can focus on the people donating for these events. My problem is that 2 of the stylists here are refusing to take themselves off the books for these days and are continuting to schedule appointments although I have made it clear that the salon WILL be closed to regular clients on these days. And the days we are having these events are at a minimum of 3 months away, so there is ample time to adjust their schedules. But they continue to disregard everything I am saying. So I guess my question is, by law what is the amount of time I am required to give notice of having to close the salon for whatever reason, and what can I do about these stylists? Thanks so much for your help!
PS. Im in Virginia if that helps
March 29th, 2010 at 9:34 amso why do you think so?
April 4th, 2010 at 3:57 amHOW MUCH SHOULD A SALON CHARGE FOR COMMISSION?
April 22nd, 2010 at 2:20 pmHelp! I am a new renter. Experienced and steady clientel of 13 years. I have always worked in the same salon but natural disaster sent me in a new direction. I found a salon that is close to home, easy to get to, and the owner seems fair. However, we are both newbies @ the renting. When I inquired about renting from her, I was under the assumption that I would pay a daily fee, or a weekly fee. I was also under the assupmtion that what I did with my clients was my pay. When a walk-in came to the salon for the 1st time last week, I was the only stylist prepared to do the work. She paid by credit, which is something I have asked my regulars to refrain from, and she left with a smile. Later that day, when I went to collect my pay for that job, the owner took her own cut. 30%! Is it normal that the owner collect a commission for walk-in clientel?
May 29th, 2010 at 5:59 pmWhat about product sales? If my client comes in and asks to buy $50 worth of product, shouldn’t I get a percentage from that sale?
I’m confused and I don’t want to have hard feelings about the lil stuff that can become big problems later.
Anyone?
The problem with the advice above, is that if a salon owner writes the clauses into the contract as stated above the stylist will likely be treated not as an independent contractor but as an employee, regardless of what title is given to the stylist in the contract.
The repercussions of this will not be felt until, say, your stylist injures him or herself, or one of the customers, and then you can be responsible for the Workers Compensation action or the tort suit of the customer.
Additionally, causing someone to become an employee has tax implications as well.
Those are only some of the problems that can come about as a result of the recommendations above. If anyone chooses to do this, I recommend they have an attorney draft the contract and ask that person specifically about the status of independent contractors versus employees. If he or she says that the control of the person is not important, go somewhere else.
Stefan
June 3rd, 2010 at 1:12 pmI just opened a booth rental salon and I have a very extensive contract that I thought I had covered all the bases with ..just hired “the dude” the one we all know and would rather not deal with ..but I thought I would be ok ..well, after giving him the contract with a pencil to check anything he wanted to discuss before he signed and then of course ..he signs without any questions and now ..everyday he has a “beef” with something or another ..the oen thing I forgot to cover was “advertising ” and he has advertised a $1.99 haircut …what is he thinking ??? and what should I do ????
June 23rd, 2010 at 4:13 pmFascinating stuff you talk about here. Almost a a single sided argument don’t you think?
July 29th, 2010 at 12:05 pmhi,i own my salon and some one came to rent a chair,what kind of agreement will it suit both of us.thanks
August 17th, 2010 at 3:14 amThanks for the info, I must bookmark your web site for my reference
August 19th, 2010 at 1:19 am