In Washington, what happens to provisions in the Boulder Designs franchise agreement that conflict with limitations on noncompetition covenants?
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 wi
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, any provisions within the franchise agreement that conflict with Washington state's limitations on noncompetition covenants are considered void and unenforceable in Washington. This protection extends to both employees and independent contractors of a Boulder Designs franchisee.
For an employee of a Boulder Designs franchisee, a noncompetition covenant is unenforceable if their annualized earnings from the franchisee do not exceed $100,000 per year. This amount is subject to annual adjustments for inflation. Similarly, for an independent contractor of a Boulder Designs franchisee, a noncompetition covenant is unenforceable if their annualized earnings from the franchisee do not exceed $250,000 per year, also adjusted annually for inflation.
This means that Boulder Designs franchisees in Washington cannot enforce non-compete agreements against lower-earning employees or independent contractors, providing these individuals with greater freedom to work for competitors or start their own businesses after leaving the franchise. This also protects the franchisee from unduly restrictive covenants that might hinder their ability to hire qualified staff or contractors.