What is the minimum annualized earnings threshold for a Black Bear Diner franchisee's employee for a noncompetition covenant to be enforceable in Washington?
Black_Bear_Diner Franchise · 2025 FDDAnswer from 2025 FDD Document
each otherin goodfaith.
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- Indemnification. Any provision in the franchise agreement or related agreements requiring thefranchiseetoindemnify,reimburse,defend,orholdharmlessthefranchisororother parties is hereby modified such that the franchisee has no obligation to indemnify, reimburse, defend,orholdharmlessthefranchisororanyotherindemnified party forlosses orliabilitiesto the extent that they are caused by the indemnified party's negligence, willful misconduct,strict liability,orfraud.
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- Attorneys' Fees. Ifthe franchise agreement or related agreementsrequire a franchisee to reimburse the franchisor for court costs or expenses, including attorneys' fees, such provision appliesonlyifthe franchisoristheprevailing partyinanyjudicialor arbitration proceeding.
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- **Noncompe
Source: Item 23 — RECEIPT (FDD pages 56–243)
What This Means (2025 FDD)
According to the 2025 Black Bear Diner Franchise Disclosure Document, in Washington, a noncompetition covenant is void and unenforceable against an employee of a franchisee unless the employee's earnings from the party seeking enforcement, when annualized, exceed $100,000 per year. This amount will be adjusted annually for inflation. This means that Black Bear Diner franchisees in Washington cannot enforce non-compete agreements against employees who earn less than this threshold.
This provision is based on RCW 49.62.020. The FDD clarifies that any conflicting provision in the franchise agreement is void and unenforceable in Washington. This protects lower-earning employees from being restricted by non-compete agreements, allowing them greater freedom to seek other employment opportunities.
In addition, a noncompetition covenant is void and unenforceable against an independent contractor of a Black Bear Diner franchisee under RCW 49.62.030 unless the independent contractor's earnings from the party seeking enforcement, when annualized, exceed $250,000 per year, and this amount will be adjusted annually for inflation.
Prospective Black Bear Diner franchisees in Washington should be aware of these limitations on non-competition agreements. They should consult with legal counsel to ensure their employment agreements comply with Washington law. This information is crucial for managing employees and independent contractors effectively within the legal framework of the state.