If you wish to open a restaurant, you will likely come into contact with various contracts and licenses. For instance, when scouting a location for your restaurant, you will likely need to enter into a commercial lease. You will also need to consider which licenses you must acquire before your restaurant opens. This article outlines some contracts you may encounter if you wish to open a restaurant.
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Commercial Lease
You will likely start your restaurant venture by searching for a suitable location for your business. Like many business owners, you can enter into a commercial lease rather than owning your business space.
However, it is crucial to understand the contents of your lease before signing it. Generally, the lease will outline specific points, such as:
- when the lease begins;
- the length of the lease (typically three to five years) and any option for renewal;
- the rent amount, how it is calculated and any outgoings you need to pay;
- any restrictions on your ability to carry out work on the premises; and
- what you will need your landlord’s consent for.
A lawyer can help you negotiate a reasonable lease that allows you to use the premises in line with your restaurant’s needs.
Fit-Out Work
Once you find your location and sign your lease, you can begin renovating the business premises to transform it into a restaurant. Additionally, your lease agreement likely covers whether your landlord permits fit-outs and the process for seeking approval if necessary.
If you decide to engage a professional fit-out contractor for this work, you will enter into a contractor agreement. This document will outline the following:
- scope of work;
- expectations;
- prohibited conduct;
- payment; and
- termination of the relationship.
Employment Agreements
Next, you will likely start recruiting to meet the staffing demands of your restaurant. This could include recruiting several:
- waitstaff;
- chefs; and
- management staff.
Additionally, you will need to decide on what basis you will employ your staff and reflect this in their employment agreements. For instance, you can employ your staff as:
- casual;
- part-time;
- or full-time employees.
Some Australian states and territories require restaurants to nominate a food safety supervisor responsible for ensuring compliance with food safety standards and codes. You can nominate an existing employee to take on this role or hire an external contractor.
You must also comply with:
- Australia’s Fair Work Act 2009 (Cth);
- your industry’s relevant award; and
- tax and superannuation obligations.
Supply Agreements
You must enter good supply agreements to ensure that you meet your restaurant’s supply demands. In your supply agreements, you should list the:
- terms and conditions;
- payment details; and
- other important commercial details in each of your supply agreements.
Licensing Requirements
Food Business Licence
Before you open a restaurant, you must first obtain a food business licence by registering with your local council. Your local council will assess your application by considering the:
- suitability of your premises;
- your compliance history; and
- skill and knowledge in serving safe food.
Liquor Licence
If you intend on serving or selling liquor at your restaurant, you must also ensure that you have the correct licence. The specific requirements will vary depending on your state or territory. Additionally, you will need to consider where you serve the alcohol (i.e. inside or outside) and council requirements around land use.
Website Terms of Use
Your website is the first place many customers will visit when deciding if they want to book a reservation at your restaurant. Therefore, you should publish a website term of use document on your website. This document should outline how people can use your website and address any disclaimers about your website’s content.
Privacy Policy
If you collect personal information from your customers, you must have a privacy policy that sets out:
- why you are collecting the information;
- how you will deal with the information; and
- how you will safely store the information.
In regards to the restaurant industry, you might acquire a customer’s personal information in the course of making a reservation. This information can include their:
- name;
- phone number; and
- email address.
Key Takeaways
If you wish to open a restaurant, it can be both exciting and challenging. To ensure that you are adequately protecting your restaurant, you should have a good understanding of:
- your commercial lease;
- the various contracts you are entering; and
- the mandatory licensing requirements that apply to you.
If you require assistance drafting and reviewing contracts when opening your restaurant, our experienced contract lawyers can assist as part of our LegalVision membership. You will have unlimited access to lawyers to answer your questions and draft and review your documents for a low monthly fee. Call us today on 1300 544 755 or visit our membership page.
Frequently Asked Questions
Yes. Before opening your restaurant, you must first obtain a food business licence by registering with your local council.
If you intend on serving or selling liquor at your restaurant, you must also ensure that you have the correct licence. The specific requirements will vary depending on your state or territory. Your staff will also require Responsible Service of Alcohol (RSA) training.
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