What is the minimum annualized earnings threshold for a Beem Light Sauna franchisee's employee for a noncompetition covenant to be enforceable in Washington?
Beem_Light_Sauna Franchise · 2025 FDDAnswer from 2025 FDD Document
the agreement is in effect and where the parties are represented by independent counsel, in accordance with RCW 19.100.220(2).
-
- Franchisor's Business Judgement. Provisions in the franchise agreement or related agreements stating that the franchisor may exercise its discretion on the basis of its reasonable business judgment may be limited or superseded by RCW 19.100.180(1), which requires the parties to deal with each other in good faith.
-
- Indemnification. Any provision in the franchise agreement or related agreements requiring the franchisee to indemnify, reimburse, defend, or hold harmless the franchisor or other parties is hereby modified such that the franchisee has no obligation to indemnify, reimburse, defend, or hold harmless the franchisor or an
Source: Item 23 — RECEIPT (FDD pages 71–230)
What This Means (2025 FDD)
According to the 2025 Beem Light Sauna FDD, in Washington, a noncompetition covenant is only enforceable against an employee of a Beem Light Sauna franchisee if the employee's annualized earnings exceed $100,000 per year. This amount will be adjusted annually for inflation. This rule is based on Washington state law (RCW 49.62.020).
For a Beem Light Sauna franchisee in Washington, this means that any noncompetition agreements they require their employees to sign are only valid if the employee earns above this threshold. If an employee earns less than $100,000 annualized (adjusted for inflation), the noncompetition covenant is void and unenforceable.
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 Beem Light Sauna franchisee 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).