In Washington state, what is the minimum annualized earnings threshold for an independent contractor of a Bambu franchisee for a noncompetition covenant to be enforceable?
Bambu Franchise · 2025 FDDAnswer from 2025 FDD Document
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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 contractor's earnings from the party seeking enforcement, when annualized, exceed $250,000 per year (an amount that will be adjusted annually for inflation). As a res
Source: Item 23 — Receipts (FDD pages 52–209)
What This Means (2025 FDD)
According to Bambu's 2025 Franchise Disclosure Document, Washington state law has specific requirements for noncompetition covenants to be enforceable. For an independent contractor working for a Bambu franchisee, the noncompetition covenant is only enforceable if the independent contractor's annualized earnings from the franchisee exceed $250,000 per year. This amount will be adjusted annually for inflation. This threshold is established under RCW 49.62.030. Any provisions within the franchise agreement or other related documents that conflict with this earnings threshold are considered void and unenforceable in Washington.
This means that if a Bambu franchisee in Washington wants to enforce a non-compete agreement against an independent contractor, they must ensure that the contractor's earnings meet or exceed this specified amount. If the earnings fall below this threshold, the non-compete agreement is not legally binding. This regulation protects independent contractors from being unduly restricted in their ability to work for others if their earnings are not substantial.
Prospective Bambu franchisees in Washington should be aware of this regulation and ensure that their agreements with independent contractors comply with state law. Failure to do so could result in unenforceable non-compete agreements, potentially impacting the franchisee's ability to protect their business interests. It is important to consult with legal counsel to ensure full compliance with Washington's noncompetition laws when drafting and enforcing such agreements.