Are noncompetition covenants enforceable against Belocal franchisee employees in Washington if their earnings are below a certain threshold?
Belocal Franchise · 2025 FDDAnswer from 2025 FDD Document
. 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 result, any provisions contained in the franchise agreement or elsewhere that conflict with these limitations are void and unenforceable in Washingto
Source: Item 22 — CONTRACTS (FDD page 71)
What This Means (2025 FDD)
According to Belocal's 2025 Franchise Disclosure Document, noncompetition covenants have limitations regarding enforcement against employees and independent contractors of a Belocal franchisee in Washington state. Specifically, a noncompetition covenant is void and unenforceable against an employee if their annualized earnings from the party seeking enforcement do not exceed $100,000 per year. This amount will be adjusted annually for inflation.
Similarly, a noncompetition covenant is void and unenforceable against an independent contractor of a Belocal franchisee if their annualized earnings from the enforcing party do not exceed $250,000 per year, also subject to annual inflation adjustments. Any provisions within the franchise agreement or elsewhere that conflict with these earnings-based limitations are void and unenforceable in Washington.
This means that Belocal franchisees in Washington cannot enforce non-compete agreements against employees earning less than the specified threshold. This protects lower-earning employees and independent contractors from being unduly restricted in their future employment opportunities. Franchisees need to be aware of these limitations when drafting and enforcing non-competition agreements to ensure compliance with Washington state law.