For C12 Group franchises in Washington, what happens to provisions conflicting with the limitations on noncompetition covenants?
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 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 fra
Source: Item 23 — RECEIPTS (FDD pages 46–137)
What This Means (2025 FDD)
According to the 2025 C12 Group 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 is due to specific regulations outlined in RCW 49.62.020 and RCW 49.62.030. These regulations stipulate that noncompetition covenants are unenforceable against an employee if their annualized earnings are below $100,000, and against an independent contractor if their annualized earnings are below $250,000. These amounts are subject to annual adjustments for inflation.
This means that C12 Group franchisees in Washington cannot enforce non-compete agreements against employees or independent contractors who do not meet the specified earnings thresholds. The state law takes precedence over any conflicting terms in the franchise agreement, ensuring that the franchisee's ability to restrict the future employment or contracting opportunities of their workers is limited by state regulations.
Furthermore, RCW 49.62.060 prohibits C12 Group from restricting a franchisee from soliciting or hiring any employee of another franchisee within the C12 Group system, or from soliciting or hiring any employee of C12 Group itself. Any provisions in the franchise agreement that attempt to impose such restrictions are also void and unenforceable in Washington. This aspect of the law promotes greater labor mobility within the C12 Group franchise network and between the franchisor and its franchisees in Washington.