What happens to provisions in the Bombs Away franchise agreement that conflict with Washington's limitations on noncompetition covenants?
Bombs_Away Franchise · 2024 FDDAnswer from 2024 FDD Document
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, or rights or remedies under the Act such as a right to a jury trial, may not be enforceable.
Transfer fees are collectable if they reflect 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 result, any pro
Source: Item 23 — RECEIPTS (FDD pages 36–117)
What This Means (2024 FDD)
According to the 2024 Bombs Away FDD, any provisions within the franchise agreement that conflict with Washington's limitations on noncompetition covenants are considered void and unenforceable in Washington state. This protection extends to both employees and independent contractors of a Bombs Away franchisee, with specific earnings thresholds dictating the enforceability of noncompetition covenants.
For an employee of a Bombs Away franchisee, a noncompetition covenant is void and unenforceable if their annualized earnings from the party seeking enforcement do not exceed $100,000 per year. This amount is subject to annual adjustments for inflation. Similarly, for an independent contractor of a Bombs Away franchisee, a noncompetition covenant is void and unenforceable if their annualized earnings from the enforcing party do not exceed $250,000 per year, also adjusted annually for inflation.
Furthermore, the FDD states that Bombs Away is prohibited from restricting, restraining, or prohibiting a franchisee from soliciting or hiring any employee of another Bombs Away franchisee or any employee of Bombs Away itself. Any provisions attempting to impose such restrictions are also void and unenforceable in Washington. This ensures franchisees in Washington have the freedom to hire and solicit employees without undue restrictions from the franchise agreement.