Under what earnings threshold is a noncompetition covenant void and unenforceable against an employee of an Itan franchisee in Washington?
Itan Franchise · 2025 FDDAnswer from 2025 FDD Document
ton Franchise Investment Protection Act, in Washington.
-
- 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.
-
- Transfer fees are collectable to the extent that they reflect the franchisor's reasonable estimated or actual costs in effecting a transfer.
-
- Pursuant to RCW 49.62.020, a non
Source: Item 23 — RECEIPT (FDD pages 44–190)
What This Means (2025 FDD)
According to Itan's 2025 Franchise Disclosure Document, in Washington, a noncompetition covenant is void and unenforceable against an employee of an Itan franchisee if the employee's annualized earnings from the party seeking enforcement do not exceed $100,000 per year. This amount is subject to annual adjustments for inflation.
This provision protects lower-earning employees from being unduly restricted by non-compete agreements. It means that Itan franchisees in Washington cannot enforce non-compete agreements against employees who earn less than the specified threshold, as adjusted for inflation. This ensures that employees have the freedom to seek other employment opportunities without being unfairly limited by a non-compete agreement.
For prospective Itan franchisees in Washington, this information is crucial for understanding the limitations on non-competition covenants. Franchisees need to be aware that any provisions in their franchise agreement or other documents that conflict with these limitations are void and unenforceable in Washington. This helps franchisees avoid potential legal issues and ensures compliance with Washington state law regarding employee non-competition agreements.