What is the annual earnings threshold for a Churchs Chicken franchisee employee above which a noncompetition covenant may be enforceable in Washington?
Churchs_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
such as a right to a jury trial, may not be enforceable.
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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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- 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 p
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 50–55)
What This Means (2025 FDD)
According to Churchs Chicken's 2025 Franchise Disclosure Document, in the state of Washington, a noncompetition covenant is only enforceable against an employee of a Churchs Chicken franchisee if the employee's annualized earnings exceed $100,000 per year. This amount will be adjusted annually for inflation.
This means that if a Churchs Chicken franchisee in Washington wants to enforce a non-compete agreement against an employee, that employee must be earning a substantial income. This protects lower-wage workers from being restricted in their future employment opportunities.
For Churchs Chicken franchisees operating in Washington, it's crucial to understand this limitation on non-competition agreements. Any provisions in the franchise agreement that conflict with this Washington state law are considered void and unenforceable. Franchisees should consult with legal counsel to ensure their employment agreements comply with these regulations.