Under Washington law, what is the minimum annualized earnings an employee must make for a noncompetition covenant to be enforceable against them for a Bonchon franchise?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
r into two consecutive Successor Franchise Agreements and the conditions the Franchisee must satisfy in order to have the right to enter into a Successor Franchise Agreement, respectively. The Franchisor will have no obligation upon the termination of the second Successor Franchise Agreement to offer the Franchisee a continued right to operate its Bonchon Business, and the Franchisee may be required at that time to stop operating its restaurant as a Bonchon Restaurant and to comply with all post-termination obligations.
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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 annual
Source: Item 23 — RECEIPTS (FDD pages 92–536)
What This Means (2025 FDD)
According to Bonchon's 2025 Franchise Disclosure Document, Washington state law impacts the enforceability of noncompetition covenants for employees and independent contractors of a Bonchon franchise. Specifically, pursuant to RCW 49.62.020, a noncompetition covenant is void and unenforceable against an employee of a Bonchon franchisee if the employee's annualized earnings from the party seeking enforcement do not exceed $100,000 per year. This amount is subject to annual adjustments for inflation.
For independent contractors of a Bonchon franchise, a noncompetition covenant is void and unenforceable under RCW 49.62.030 if their annualized earnings from the enforcing party do not exceed $250,000 per year, also adjusted annually for inflation. This means that Bonchon franchisees in Washington cannot enforce non-compete agreements against employees earning less than $100,000 annually (adjusted for inflation) or independent contractors earning less than $250,000 annually (adjusted for inflation).
Bonchon acknowledges that any provisions within the franchise agreement or other documents that conflict with these Washington state limitations are void and unenforceable in Washington. This ensures that Bonchon's franchise agreements comply with Washington law regarding noncompetition covenants, protecting lower-earning employees and independent contractors from potentially restrictive agreements.