What is the minimum annualized earnings an independent contractor of a Deck Medic franchisee must earn for a noncompetition covenant to be enforceable in Washington?
Deck_Medic Franchise · 2024 FDDAnswer from 2024 FDD Document
iolation of the Washington Franchise Investment Protection Act, in Washington.
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- A release or waiver of rights executed by a franchisee may not include rights under the Washington Franchise Investment Protection Act or any rule or order thereunder except when executed pursuant to a negotiated settlement after 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.
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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
Source: Item 23 — RECEIPTS (FDD pages 43–228)
What This Means (2024 FDD)
According to Deck Medic's 2024 Franchise Disclosure Document, in Washington, a noncompetition covenant is void and unenforceable against an independent contractor working for a Deck Medic franchisee unless the independent contractor's annualized earnings from the party seeking enforcement exceed $250,000 per year. This amount will be adjusted annually for inflation. This is based on RCW 49.62.030.
This means that if a Deck Medic franchisee in Washington wants to enforce a non-compete agreement against an independent contractor, they can only do so if that contractor earns more than $250,000 annually. If the contractor earns less than this amount, the non-compete agreement is not legally enforceable. The $250,000 threshold is subject to annual adjustments for inflation, so franchisees need to stay updated on the current applicable amount.
This provision protects lower-earning independent contractors from being unduly restricted in their ability to work for others after leaving a Deck Medic franchise. It also ensures that Deck Medic franchisees cannot use non-compete agreements to stifle competition from contractors who do not meet the earnings threshold. Franchisees should consult with legal counsel to ensure their non-compete agreements comply with Washington law and to understand the current earnings threshold for enforceability.