In Washington, what is the annual earnings threshold for a noncompetition covenant to be enforceable against an employee of a Boulder Designs franchisee?
Boulder_Designs Franchise · 2025 FDDAnswer from 2025 FDD Document
reasonable estimated or actual costs in effecting a transfer.
Pursuant to RW 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 Washington.
RCW 49.62.060 prohibits a franchisor from restricting, restraining, or prohibiting a franchisee from (i) soliciting or hiring any employee of a franchisee of the same franchisor or (ii) soliciting or hiring any employee of the franchisor. As a result, any such provisions contained in the franchise ag
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 38–44)
What This Means (2025 FDD)
According to Boulder Designs' 2025 Franchise Disclosure Document, in Washington, a noncompetition covenant is void and unenforceable against an employee of a Boulder Designs franchisee unless the employee's earnings, when annualized, exceed $100,000 per year. This amount will be adjusted annually for inflation. This is based on Revised Code of Washington (RCW) 49.62.020.
For independent contractors of a Boulder Designs franchisee, a noncompetition covenant is void and unenforceable under RCW 49.62.030 unless their annualized earnings exceed $250,000 per year, also adjusted annually for inflation.
Any provisions in the franchise agreement that conflict with these limitations are void and unenforceable in Washington. Additionally, RCW 49.62.060 prohibits Boulder Designs from restricting a franchisee from soliciting or hiring employees of other Boulder Designs franchisees or employees of Boulder Designs itself, rendering any conflicting provisions unenforceable.