Proselyting

Proselyting is the term of art used in direct selling to describe the attempt to convert one or more salesforce members from one company to another. The ethics and legality of efforts to attract salespeople from one company to another is a subject of frequent and intense discussion by industry members. The Direct Selling Association has adopted guidelines regarding these practices of which salespeople and companies should be aware. The guidelines and open letter set out below attempt to describe what the Association believes is the state of the law regarding such practices as well as acceptable direct selling business practice in this regard.

An Open Letter to Direct Sellers from
DSA President Joseph Mariano

Occasionally, direct sellers in the field will be approached by other companies or their sales leaders with solicitations to join those companies. Sometimes, these solicitors present misinformation and denigrate the company you are with. Those solicitations can be inappropriate, unethical, misrepresentative, or even illegal and may be at odds with the Proselyting Guidelines of the Direct Selling Association (DSA). Under those guidelines, it is considered unethical behavior throughout the industry for one company to target the salesforce of another company in an attempt to lure salespeople into their own organization and stop selling for their original company.

It is unfortunate when such behavior reflects poorly upon the direct selling industry and results in misinformation about our business being spread throughout our salesforces and the public. That is why we urge current direct sellers, or anyone who might be interested in a direct selling opportunity, to evaluate those opportunities on the basis of facts about the company doing the recruiting. Rumor or innuendo about other opportunities often prove to be just plain wrong. So when you’re recruited, examine the appeal of the products offered, the attractiveness of the earning potential, and a company’s commitment to the ideals and obligations embodied in the DSA Code of Ethics. Those are the factors most important to you in evaluating your current company or any future opportunity you may pursue.

All members of DSA are bound by our Code of Ethics and should follow our Proselyting Guidelines, which constitute our industry’s ethical standard. To review our Code, please visit our website at www.dsa.org. We wish you strength, success, and growth in your direct selling career.

Sincerely,

Joseph N. Mariano
President


Click here to view an advisory memorandum covering more information about proselyting.

Proselyting Guidelines of the Direct Selling Association

It is considered to be an improper practice when Company A, or its representatives, specifically and consciously targets the salesforce of Company B with the intent of persuading Company B’s salespersons or employees not only to sell or work for Company A, but also to cease selling or working for Company B, thereby interfering with Company B’s business or contractual relations. This is not intended to encompass the occasional incident or two, but it does apply to situations involving more than several persons, where the pattern, approach and timing of Company A would clearly indicate an intention to adversely impact on Company B. If Company B sends correspondence to Company A regarding alleged proselyting activity, Company A is expected to appropriately respond within 30 days after receipt of the correspondence.

Frequently Asked Questions

What is proselyting?

When used in direct selling, proselyting simply describes the activity of a distributor for one direct selling company recruiting a distributor from another direct selling company. This may involve the recruiting distributor encouraging the other distributor to leave their current company or not. This could be a single isolated event or it could include an orchestrated effort by an individual recruiting distributor, group of distributors or the company to recruit many distributors from a particular company.

What are the DSA Proselyting Guidelines?

The DSA Proselyting Guidelines are aspirational in nature and declare what is considered an improper business practice with regards to proselyting.

Are the Proselyting Guidelines part of the DSA Code of Ethics?

No, the Proselyting Guidelines are not part of the DSA Code of Ethics and therefore are not enforced by the DSA Code Administrator.

Is proselyting restricted or prohibited by the DSA Code of Ethics or Proselyting Guidelines?

No, in general proselyting is not restricted or prohibited by the DSA Code of Ethics or Proselyting Guidelines. Proselyting is not covered by the DSA Code of Ethics. The Proselyting Guidelines simply declares specifically and consciously targeting another company’s salesforce with the intent to have them cease selling for their current company to be an improper business practice. The Proselyting Guidelines state:

"It is considered to be an improper business practice when Company A, or its representatives, specifically and consciously target the salesforce of Company B with the intent of persuading Company B’s salespersons or employees not only to sell or work for Company A, but also to cease selling or working for Company B, thereby interfering with Company B’s business or contractual relations. This is not intended to encompass the occasional incident or two, but it does apply to situations involving more than several persons, where the pattern, approach and timing of Company A would clearly indicate an intention to adversely impact on Company B.

If Company B sends correspondence to Company A regarding alleged proselyting activity, Company A is expected to appropriately respond within 30 days after receipt of the correspondence."

Is proselyting illegal in the United States?

No, in the United States proselyting is not illegal. However making a false or deceptive statement about a company or its products or services is a violation of law and the DSA Code of Ethics. Attempting to persuade a distributor to leave their current company could potentially be tortuous interference with a contract. The distributor that leaves a company may have legal restrictions placed on their activities under the contract they signed. They may, for instance, be prohibited from recruiting others from the salesforce of the company they departed. They may be restricted from selling similar product lines for some reasonable period of time.

Why can’t the DSA prohibit member companies from proselyting?

It is the view of the DSA Legal Department and DSA General Counsel that a blanket prohibition by DSA on proselyting would be violative of the law. Individuals, generally, are free to communicate with others and choose for whom they would like to work.

What can a company do if it thinks it is being targeted for proselyting?

  1. Review and familiarizing yourself with the Proselyting Information Kit.
  2. Gather as much objective information about the alleged activity as possible. This can included written statements from your salesforce, letters, emails or other information that will substantiate the claim of proselyting. Rumors, hearsay and third-hand information is seldom accurate.
  3. Contact the company that you have reason to believe is proselyting your salesforce directly. It could be just a misunderstanding. They may not be aware of the activity. They may want to conduct their own internal investigation to determine the facts for themselves. They may be more than willing to resolve the complaint to your satisfaction. DSA is available to facilitate these communications, if desired.
  4. If the matter cannot be resolved with step three, then you may seek mediation as outlined in the Proselyting Information kit. DSA is available to facilitate this as well.
  5. The last resort is litigation, which can be costly, time consuming and still may not give you the result that you seek.