Washington’s non-competition agreement law governs when a non-competition agreement may be considered valid or enforceable under state law.
One aspect to the restrictions in Washington’s non-competition law is related to earnings. Only employees or independent contractors who earn more than the thresholds established by law can be held to non-competition agreements. If an employee or independent contractor has earnings less than the threshold specified under law, the non-compete agreements is considered void and unenforceable under RCW 49.62. These thresholds are established in RCW 49.62.020 (for employees) and RCW 49.62.030 (for independent contractors).
Pursuant to RCW 49.62.040, the Department of Labor & Industries must adjust these thresholds for inflation each year. The adjustments for 2021 are below.
|Statutory Dollar Adjustments||Pre-Adjusted (2020) Thresholds||2021 Thresholds|
|RCW 49.62.020||$ 100,000.00||$101,390.00|
|RCW 49.62.030||$ 250,000.00||$253,475.00|
Other elements of the non-competition agreement law
In addition to the earnings thresholds established by law, the law also establishes other restrictions on non-competition agreements in Washington. These other restrictions include:
- A provision in a non-competition agreement signed by a Washington-based employee or independent contractor is void and unenforceable when the agreement requires the worker to adjudicate the agreement outside of Washington and when the agreement denies the worker protections established by the law. See RCW 49.62.050.
- Franchisors may not prevent franchisees from hiring employees of the franchisor or other franchisees of the same franchisor. See RCW 49.62.060.
- Employers are generally not permitted to prohibit employees earning less than twice the state minimum wage from having an additional employment; this restriction is subject to some limitations. See RCW 49.62.070.
Violations of the law
Under Washington’s non-competition agreement law, the Attorney General’s Office may pursue relief for violations of the law. Aggrieved individuals may also pursue relief on their own through the courts.
To file a complaint or if you have questions about this law, contact the Attorney General’s Office or call 206-587-5510. L&I does not have enforcement authority under this law.