What is the minimum annualized earnings for an independent contractor of a Cool Binz franchisee for a noncompetition covenant to be enforceable in Washington?
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, a noncompetition covenant is unenforceable against an independent contractor of a Cool Binz franchisee if the independent contractor's annualized earnings from the party seeking enforcement do not exceed $250,000 per year. This amount will be adjusted annually for inflation.
This means that if a Cool Binz franchisee in Washington wants to enforce a non-compete agreement against an independent contractor, the contractor must be earning at least $250,000 annually. If the contractor earns less than this amount, the non-compete agreement is void and unenforceable. This protects lower-earning independent contractors from being unduly restricted in their ability to work for others.
This provision is specific to Washington state law (RCW 49.62.030) and is designed to protect independent contractors. Cool Binz franchisees operating in Washington need to be aware of this limitation when drafting or enforcing non-competition agreements with their independent contractors. The FDD explicitly states that any conflicting provisions within the franchise agreement are void and unenforceable in Washington, reinforcing the primacy of state law.