What is the effect of RCW 49.62.020 on noncompetition covenants for Buns On Fire franchisee employees?
Buns_On_Fire Franchise · 2025 FDDAnswer from 2025 FDD Document
and renewal of your franchise.
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- In the event of a conflict of laws, the provisions of the Washington Franchise Investment Protection Act, Chapter 19.100 RCW will prevail.
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- Transfer fees are collectable to the extent that they reflect the Franchisor's reasonable estimated or actual costs in effecting a transfer.
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- Section 4.01 of the Franchisee Agreement shall be amended to add the following language:
- "In lieu of an impound of franchise fees, the Franchisor will not require or accept the payment of any initial franchise fees until the franchisee has (a) received all pre-opening and initial training obligations that it is entitled to under the franchise agreement or offering circular, and (b) is open for business."
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- Pursuant to RCW 49.62.020, a noncompetitio
Source: Item 23 — RECEIPTS (FDD pages 49–200)
What This Means (2025 FDD)
According to the 2025 Buns On Fire Franchise Disclosure Document, RCW 49.62.020 directly impacts the enforceability of noncompetition covenants for franchisee employees in Washington state. Specifically, a noncompetition covenant is considered void and unenforceable if an employee's annualized earnings from the party seeking enforcement (in this case, the Buns On Fire franchisee) do not exceed $100,000 per year. This threshold will be adjusted annually for inflation.
Furthermore, RCW 49.62.030 extends similar protections to independent contractors of a Buns On Fire franchisee. A noncompetition covenant is unenforceable against an independent contractor if their annualized earnings from the enforcing party are below $250,000 per year, also subject to annual inflation adjustments.
This means that Buns On Fire franchisees in Washington cannot enforce non-compete agreements against employees or independent contractors who earn less than these specified amounts. Any provisions within the franchise agreement or other documents that conflict with these earnings limitations are deemed void and unenforceable in Washington. This addendum ensures compliance with Washington state law, providing clarity and protection for both employees and independent contractors working within the Buns On Fire franchise system.