Employment Agreement With Non Compete Clause In Washington
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FAQ
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.
Washington has severely restricted non-competition agreements since 2020 when a new state law took effect. This law includes rules on anti-moonlighting policies and provisions: No Moonlighting Restrictions for Low Wage Workers, Unless an Exception Applies.
Only workers who earn more than $123,394.17 per year or $308,485.43 per year for independent contractors can be held to non-competition agreements. The maximum wage reimbursements for the Stay at Work and Preferred Worker Programs are increasing from $10,000 to $25,000 per claim in 2025.
Enforceability of Non-Compete Clauses In 2025, employees must earn at least $123,394.17, and independent contractors must earn $308,485.43, for such agreements to be valid, compared to the previous thresholds of $120,599.99 and $301,399.98, respectively.
Noncompete agreements (often referred to as noncompetes) are postemployment restrictions that prohibit departing employees from joining or starting a competing enterprise, typically within time and geographic boundaries (for examples, see Figures OE1, OE2, and OE3 in the Online Appendix).
On April 23, 2024, the FTC passed a final rule to ban most non-compete clauses in employment agreements, finding such agreements to be unfair methods of competition (the “FTC Rule”).
Ing to its website, the 2025 threshold for employees is $123,394.17. Washington maintains a higher income threshold for independent contractors, which increases to $308,485.43 in 2025.
For laid-off employees, noncompete agreements are unenforceable unless the employer pays the full base salary through the noncompete period. For Washington-based employees, out-of-state forum selection clauses will not be enforced, regardless of where the employer is based.
Only workers who earn more than $123,394.17 per year or $308,485.43 per year for independent contractors can be held to non-competition agreements. The maximum wage reimbursements for the Stay at Work and Preferred Worker Programs are increasing from $10,000 to $25,000 per claim in 2025.
