In Washington, what is the minimum annualized earnings threshold for a noncompetition covenant to be enforceable against a Dog Haus franchisee's independent contractor?
Dog_Haus Franchise · 2025 FDDAnswer from 2025 FDD Document
action or proceeding arising out of or in connection with the sale of franchises, or a violation of the Washington Franchise Investment Protection Act, in Washington.
A release or waiver of rights executed by a franchisee shall not include rights under the Washington Franchise Investment Protection Act, 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.
Transfer fees are collectable to the extent that they reflect the Franchisor's reasonable estimated or act
Source: Item 23 — RECEIPTS (FDD pages 87–328)
What This Means (2025 FDD)
According to Dog Haus's 2025 Franchise Disclosure Document, in the state of Washington, a noncompetition covenant is unenforceable against an independent contractor of a 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 pursuant to RCW 49.62.030.
This means that if a Dog Haus franchisee in Washington wants to enforce a non-compete agreement against an independent contractor, the contractor must be earning at least $250,000 annually from the franchisee. If the contractor earns less than this amount, the non-compete agreement is void and unenforceable under Washington law. This protects independent contractors from being unduly restricted in their ability to work for others if their earnings are below this threshold.
This provision is specific to Washington state and reflects the state's laws regarding non-competition agreements. Dog Haus franchisees operating in Washington need to be aware of this requirement when drafting or enforcing non-compete agreements with their independent contractors. The FDD explicitly states that any conflicting provisions in the franchise agreement are void and unenforceable in Washington, underscoring the importance of adhering to state law.