If the franchise agreement conflicts with limitations on noncompetition covenants in Washington, which provisions are enforceable for a Pearce Bespoke franchise?
Pearce_Bespoke Franchise · 2025 FDDAnswer from 2025 FDD Document
se 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 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 independent contractor of a franchisee under RCW 49.62.030 unless the independent contractor's earnings from the party seeking enforcement, when annualized, exceed $250,000 per year (an amount that will be adjusted annually for inflation). As a result, any provisions contained in the franchise agreement or elsewhere that conflict with these limitations are void and unenforceable in Washington.
RCW 49.62.060 prohibits a fran
Source: Item 22 — CONTRACTS (FDD page 39)
What This Means (2025 FDD)
According to the 2025 Pearce Bespoke FDD, Washington state law places specific limitations on noncompetition covenants. For an employee of a Pearce Bespoke franchisee, a noncompetition covenant is void and unenforceable if the employee's annualized earnings from the party seeking enforcement do not exceed $100,000, an amount that will be adjusted annually for inflation. Similarly, for an independent contractor of a Pearce Bespoke franchisee, such a covenant is unenforceable if their annualized earnings from the enforcing party do not exceed $250,000, also adjusted annually for inflation.
This means that any part of the Pearce Bespoke franchise agreement that contradicts these Washington state laws is void and unenforceable within Washington. This includes any provisions that might attempt to impose stricter non-compete terms on employees or independent contractors earning below these thresholds.
Additionally, Pearce Bespoke cannot restrict a franchisee in Washington from soliciting or hiring employees of other franchisees within the Pearce Bespoke system, or from soliciting or hiring employees of the franchisor itself. Any provisions in the franchise agreement attempting to impose such restrictions are also void and unenforceable in Washington. Therefore, Pearce Bespoke franchisees in Washington have more freedom in hiring and are only subject to non-compete agreements with employees and contractors who meet the specified high-income thresholds.