What is the effect of provisions in the Apricot Lane franchise agreement that conflict with the limitations on noncompetition covenants in Washington?
Apricot_Lane Franchise · 2025 FDDAnswer from 2025 FDD Document
lease or waiver of rights executed by a franchisee may not include rights under the Washington Franchise Investment Protection Act or any rule or order thereunder except when executed pursuant to a negotiated settlement after the agreement is in effect and where the parties are represented by independent counsel. Provisions such as those which unreasonably restrict or limit the statute of limitations period for claims under the Act, or rights or remedies under the Act such as a right to a jury trial, may not be enforceable.
Transfer fees are collectable to the extent that they reflect the franchisor's reasonable estimated or actual costs in effecting a transfer
Pursuant to RCW 49.62.020, a noncompetition covenant is void and unenforceable against an employee, including an employee of a franchisee, unless the employee's earnings from the party seeking enforcement, when annualized, exceed $100,000 per year (an amount that will be adjusted annually for inflation). In addition, a noncompetition covenant is void and unenforceable against an independent contractor of a franchisee under RCW 49.62.030 unless the independent contract
Source: Item 23 — RECEIPTS (FDD pages 51–222)
What This Means (2025 FDD)
According to the 2025 Apricot Lane Franchise Disclosure Document, provisions within the franchise agreement that conflict with Washington state's limitations on noncompetition covenants are void and unenforceable in Washington. This protection extends to employees and independent contractors of Apricot Lane franchisees.
For employees, including those of a franchisee, a noncompetition covenant is unenforceable if their annualized earnings from the party seeking enforcement do not exceed $100,000 per year. This amount is subject to annual adjustments for inflation. Similarly, for independent contractors of a franchisee, a noncompetition covenant is unenforceable if their annualized earnings from the enforcing party are less than $250,000 per year, also adjusted annually for inflation.
Additionally, Apricot Lane is prohibited from restricting a franchisee from soliciting or hiring any employee of another Apricot Lane franchisee or any employee of the franchisor. Any provisions in the franchise agreement that attempt to impose such restrictions are also void and unenforceable in Washington. This addendum ensures that the franchise agreement adheres to Washington state law, providing clarity and protection for franchisees and their employees and contractors operating in Washington.