For a Cool Binz franchise in Washington, will the $250,000 earnings threshold for independent contractors regarding non-competition covenants be adjusted annually?
Cool_Binz Franchise · 2025 FDDAnswer from 2025 FDD Document
ired by Sections 10.B.8 and 11.C of the Franchise Agreement, does not apply to claims arising under the Franchise Investment Protection Act, chapter 19.100 RCW, or any rules or order adopted thereunder, in accordance with RCW 19.100.220(2).
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- Transfer fees are collectable only to the extent that they compensate the franchisor for expenses directly incurred as a result of 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 ind
Source: Item 23 — RECEIPTS (FDD pages 63–238)
What This Means (2025 FDD)
According to Cool Binz's 2025 Franchise Disclosure Document, in Washington state, non-competition covenants have specific earnings thresholds that trigger their enforceability. For an employee of a Cool Binz franchisee, a noncompetition covenant is void and unenforceable unless the employee's earnings, when annualized, exceed $100,000 per year. For an independent contractor of a Cool Binz franchisee, a noncompetition covenant is void and unenforceable unless their earnings, when annualized, exceed $250,000 per year.
Both of these earnings thresholds ($100,000 for employees and $250,000 for independent contractors) are subject to annual adjustments for inflation. This means that these income figures will likely change each year to reflect the current economic conditions and cost of living.
This adjustment is based on Washington state law (RCW 49.62.020 and RCW 49.62.030), and Cool Binz states that any provisions in the franchise agreement that conflict with these limitations are void and unenforceable in Washington. Therefore, Cool Binz franchisees in Washington must be aware of these annually adjusted income thresholds when implementing non-competition agreements with their employees and independent contractors.