In Washington, what is the annual earnings threshold for an independent contractor of a City Publications franchisee for a noncompetition covenant to be enforceable?
City_Publications Franchise · 2025 FDDAnswer from 2025 FDD Document
fter the agreement is in effect and where the parties are represented by independent counsel. Provisions such as those which unreasonably restrict or limit the statute of limitations period for claims under the Act, or rights or remedies under the Act such 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 noncomp
Source: Item 23 — RECEIPT (FDD pages 39–129)
What This Means (2025 FDD)
According to City Publications' 2025 Franchise Disclosure Document, in Washington, a noncompetition covenant is void and unenforceable against an independent contractor of a City Publications 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 stipulation is based on RCW 49.62.030.
This means that if a City Publications franchisee in Washington wants to enforce a non-compete agreement against an independent contractor, the contractor must be earning more than $250,000 annually from that franchisee. If the contractor earns less than this threshold, the non-compete agreement is not legally enforceable.
This provision protects independent contractors from being unduly restricted in their ability to work for others if their earnings from the City Publications franchise are below the specified level. Franchisees need to be aware of this limitation when drafting and attempting to enforce non-compete agreements with their independent contractors in Washington.