What is prohibited in the offer to Engel & Volkers regarding the cost or terms imposed on the franchisor?
Engel_Volkers Franchise · 2025 FDDAnswer from 2025 FDD Document
RCW 49.62.060 prohibits a franchisor from restricting, restraining, or prohibiting a franchisee from (i) soliciting or hiring any employee of a franchisee of the same franchisor or (ii) soliciting or hiring any employee of the franchisor. As a result, any such provisions contained in the franchise agreement or elsewhere are void and unenforceable in Washington.
Section 1.5 of the Franchise Agreement does not apply in Washington.
No statement, questionnaire, or acknowledgment signed or agreed to by a franchisee in connection with the commencement of the franchise relationship shall have the effect of (i) waiving any claims under any applicable state franchise law, including fraud in the inducement, or (ii) disclaiming reliance on any statement made by any franchisor, franchise seller, or other person acting on behalf of the franchisor. This provision supersedes any other term of any document executed in connection with the franchise.
Source: Item 22 — CONTRACTS (FDD page 88)
What This Means (2025 FDD)
According to Engel & Volkers' 2025 Franchise Disclosure Document, in the state of Washington, a franchisor is prohibited from restricting, restraining, or prohibiting a franchisee from soliciting or hiring any employee of a franchisee of the same franchisor, or soliciting or hiring any employee of the franchisor. This means that any provisions in the franchise agreement that attempt to prevent a franchisee from hiring employees from other Engel & Volkers franchisees or from Engel & Volkers itself are void and unenforceable in Washington state.
This protection for franchisees in Washington ensures that they have the freedom to recruit and hire qualified individuals, regardless of their current employer within the Engel & Volkers network. It prevents Engel & Volkers from imposing restrictions that could limit a franchisee's ability to staff their business effectively.
Furthermore, the FDD states that no statement, questionnaire, or acknowledgment signed by a franchisee at the start of the franchise relationship can waive claims under state franchise law, including fraud in the inducement, or disclaim reliance on statements made by the franchisor. This provision is designed to protect franchisees from unknowingly giving up their legal rights or claims against Engel & Volkers.