What happens if a provision of the agreement is deemed too restrictive for Big Apple Bagels employees?
Big_Apple_Bagels Franchise · 2025 FDDAnswer from 2025 FDD Document
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- In the event of a conflict of laws, the provisions of the Washington Franchise Investment Protection Act, Chapter 19.100 RCW shall prevail.
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- A release or waiver of rights executed by a franchisee shall 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, rights or remedies under the Act such as a right to a jury trial, may not be enforceable.
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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.
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- 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 co
Source: Item 23 — RECEIPTS (FDD pages 87–319)
What This Means (2025 FDD)
According to Big Apple Bagels' 2025 Franchise Disclosure Document, specifically concerning Washington State, any provisions within the franchise agreement or related documents that conflict with state limitations on non-competition covenants are considered void and unenforceable. This protection extends to both employees and independent contractors of a Big Apple Bagels franchisee. For employees, a noncompetition covenant is unenforceable if their annualized earnings from the party seeking enforcement do not exceed $100,000, a figure that will be adjusted annually for inflation. For independent contractors, the threshold is higher, at $250,000 per year, also adjusted annually for inflation.
This means that Big Apple Bagels franchisees in Washington cannot enforce non-compete agreements against employees or independent contractors who earn less than these specified amounts. The purpose of these regulations is to protect lower-earning workers from overly restrictive employment terms that could limit their ability to find other work.
Furthermore, the FDD states that Big Apple Bagels is prohibited from restricting a franchisee from soliciting or hiring any employee of a franchisee of the same franchisor, or any employee of the franchisor itself. Therefore, any clause that violates these stipulations is void and unenforceable in Washington. This ensures that employees have the freedom to move between different Big Apple Bagels locations or even to the franchisor without undue restrictions, promoting a more competitive labor market within the franchise system.