What is the annual earnings threshold for an employee of a 1 800 Packouts franchisee in Washington for a noncompetition covenant to be enforceable?
1_800_Packouts Franchise · 2025 FDDAnswer from 2025 FDD Document
he payment of any initial franchise fees until the franchisee has (a) received all initial training that it is entitled to under the franchise agreement or offering circular, and (b) is open for business.
In any arbitration or mediation involving a franchise purchased in Washington, the arbitration or mediation site will be either in the state of Washington or in a place mutually agreed upon at the time of the arbitration or mediation, or as determined by the arbitrator or mediator at the time of arbitration or mediation. In addition, if litigation is not precluded by the franchise agreement, a franchisee may bring an action or proceeding arising out of or in connection with the sale of franchises, or a violation of the Washington Franchise Investment Protection Act,
Source: Item 23 — RECEIPT (FDD pages 67–238)
What This Means (2025 FDD)
According to 1 800 Packouts's 2025 Franchise Disclosure Document, a noncompetition covenant is void and unenforceable against an employee of a franchisee in Washington unless the employee's earnings from the party seeking enforcement, when annualized, exceed $100,000 per year. This amount will be adjusted annually for inflation.
This means that if a 1 800 Packouts franchisee in Washington wants to enforce a non-compete agreement against an employee, that employee must be earning more than $100,000 annually (adjusted for inflation). If the employee earns less than this threshold, the non-compete agreement is not enforceable under Washington law. This provision is designed to protect lower-income workers from being unduly restricted in their future employment opportunities.
This also applies to independent contractors, but the earnings threshold is different. A noncompetition covenant is void and unenforceable against an independent contractor of a 1 800 Packouts franchisee unless the independent contractor's earnings from the party seeking enforcement, when annualized, exceed $250,000 per year (also adjusted annually for inflation).