In Washington, what is the minimum annualized earnings threshold for a 1 800 Packouts employee 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, in the state of Washington, a noncompetition covenant is void and unenforceable against an employee of a franchisee 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 at least $100,000 annually. If the employee earns less than this amount, the non-compete agreement is not enforceable under Washington law. This threshold is put in place to protect lower-earning employees from being unduly restricted in their future employment opportunities.
It is important to note that this regulation applies specifically to employees. The FDD states that a different earnings threshold applies to independent contractors in Washington, where a noncompetition covenant is void and unenforceable unless the independent contractor's earnings exceed $250,000 per year, also adjusted annually for inflation. Franchisees in Washington should be aware of these stipulations and consult with legal counsel to ensure their non-compete agreements comply with Washington law.