For C12 Group franchises in Washington, what is the annual earnings threshold for an independent contractor of a franchisee for a noncompetition covenant to be enforceable?
C12_Group Franchise · 2025 FDDAnswer from 2025 FDD Document
as a right to a jury trial, may not be enforceable.
Transfer fees are collectable to the extent that they reflect the 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
Source: Item 23 — RECEIPTS (FDD pages 46–137)
What This Means (2025 FDD)
According to the 2025 C12 Group Franchise Disclosure Document, in the state of Washington, a noncompetition covenant is unenforceable against an independent contractor of a franchisee if the independent contractor's earnings from the party seeking enforcement, when annualized, do not exceed $250,000 per year. This amount will be adjusted annually for inflation.
This means that if a C12 Group franchisee in Washington wants to enforce a non-compete agreement against an independent contractor, they can only do so if that contractor earns more than $250,000 annually from the franchisee. If the contractor earns less than this amount, the non-compete agreement is void and unenforceable.
This provision protects independent contractors working for C12 Group franchisees in Washington from being unduly restricted in their ability to work for others if their earnings are below a certain level. It also means that C12 Group franchisees in Washington need to be aware of this limitation when drafting and enforcing non-compete agreements with their independent contractors.