Washington Noncompete Law: Thresholds, Notice, and Remedies

Under Washington noncompete law, an agreement that stops you from working for a competitor is void unless your employer meets strict conditions set out in RCW 49.62. For 2026, the agreement is unenforceable from the start unless you earn at least $126,858.83 as an employee or $317,147.09 as an independent contractor.¹ Even above those earnings floors, the law requires written notice at the time of the job offer, caps the restriction at 18 months, requires continued salary payments after a layoff, and hits employers with mandatory penalties and attorney fees when they overreach. The legislature wrote the statute to be read broadly in favor of workers, with exceptions construed narrowly.²

The Earnings Floor Is the First Gate

If you don’t earn enough, nothing else in the agreement matters. The Department of Labor and Industries adjusts the thresholds every year for inflation. For 2026:

Employees: $126,858.83 per year
Independent contractors: $317,147.09 per year

Earnings below those marks void the noncompete regardless of what the contract says.¹ The 2025 numbers were $123,394.17 for employees and $308,485.43 for independent contractors.

Employee “earnings” means the compensation in Box 1 of your W-2, annualized as of the earlier of the enforcement date or your last day. For independent contractors, the law looks at gross income paid by the company trying to enforce the restriction; income from other clients doesn’t count.³ The practical effect is that noncompetes are reserved for higher-earning professionals. A software engineer making $90,000 or a mid-level salesperson earning $110,000 cannot be bound by one.

What the Statute Actually Covers

RCW 49.62 reaches any written or oral agreement that stops a worker from engaging in a lawful profession, trade, or business. It also catches agreements that block you from doing business with specific customers, even when the contract never uses the word “noncompete.”³ Courts look at what the agreement restricts, not its title, so an employer can’t dodge the statute by relabeling the document.

Several restrictive agreements fall outside the statute and are governed by other law:

Nonsolicitation agreements that only prevent you from actively reaching out to former clients or coworkers.
Confidentiality and trade-secret agreements, including nondisclosure covenants and invention assignments.
Noncompetes signed in connection with the sale of at least a one-percent ownership stake in a business.
Noncompetes a franchisee signs as part of a franchise sale that complies with state franchise law.

Written Notice at the Job Offer

Timing kills most Washington noncompetes. For a new hire, the employer must disclose the full terms in writing no later than when you accept the job offer.⁴ A noncompete that first appears during orientation or on your first day is void from the start. If the agreement is written to kick in only once your pay rises above the threshold later, the employer has to say so specifically at hiring.

For current employees who never signed a noncompete when they were hired, an employer can add one only by providing independent consideration at the time of signing.⁵ That means something of real value beyond continued employment: a raise, a bonus, a promotion, or access to genuinely new proprietary information. “Sign this or you’re fired” doesn’t create a valid noncompete. Employers trip up here constantly, rolling out new agreements across a team with nothing attached and ending up with a stack of unenforceable documents.

18-Month Cap and Washington Venue

Any noncompete lasting longer than 18 months is presumed unreasonable.⁴ An employer can try to justify a longer period, but only by clear and convincing evidence that the longer restriction is genuinely necessary to protect specific business interests. Few employers clear that bar, and most carefully drafted Washington noncompetes run 12 months or less because of it.

The statute also blocks employers from pulling Washington-based workers into out-of-state courts. If you live and work in Washington, your employer cannot require you to litigate a noncompete dispute in another state or under another state’s law.⁴ A clause saying “disputes will be governed by Delaware law and heard in Delaware courts” is void as applied to a Washington worker. A national employer headquartered elsewhere cannot strip away RCW 49.62 through a boilerplate choice-of-law provision.

Layoffs Trigger Garden Leave Pay

When an employer lays off a worker, enforcing a noncompete gets expensive. The restriction is only valid during the post-employment period if the employer continues paying your base salary for the entire duration of the restriction, calculated on your compensation at the time of termination.⁴

The employer can offset those payments by what you earn from a new, non-competing job during the restricted period. But if the employer stops paying, or never starts, the noncompete dies immediately. That forces a real cost-benefit decision: is keeping this person out of the market worth six or twelve months of salary? For most laid-off employees the answer is no, which means the noncompete effectively evaporates the moment the layoff happens.

What You Can Recover When a Noncompete Is Illegal

Washington doesn’t treat an unlawful noncompete as a routine contract dispute. When a court or arbitrator finds that an agreement violates the statute, the employer must pay you the greater of your actual damages or a statutory penalty. The base penalty is $5,000, adjusted annually for inflation by the Department of Labor and Industries.⁶ The penalty applies even when the court narrows or partially enforces an overbroad agreement rather than striking it entirely.

On top of the penalty, the employer must pay your reasonable attorney fees and all costs of investigating and pursuing the claim.⁶ That fee-shifting rule removes the biggest barrier to challenging a bad noncompete and gives attorneys an incentive to take these cases, because the employer, not the worker, pays the legal bill when the agreement is unlawful.

Agreements Signed Before 2020 Still Have to Comply

RCW 49.62 applies to all legal proceedings filed on or after January 1, 2020, regardless of when the noncompete was originally signed.⁷ An employer that signed a noncompete with you in 2015 cannot enforce it in court today unless it meets every requirement of the current statute, including the earnings threshold, the written-notice rule, and the duration cap. The law is retroactive for enforcement proceedings but prospective in all other respects, so an employer that enforced a noncompete through a completed legal action before 2020 does not face clawback liability.

Franchise No-Poach Agreements Are Banned

A separate provision of RCW 49.62 targets franchise systems. A franchisor cannot restrict a franchisee from hiring or soliciting workers at other locations in the same franchise chain, or workers of the franchisor itself.⁸ These no-poach clauses were once common in fast-food and retail systems and effectively trapped workers in low-wage positions by preventing them from moving to a better-paying location nearby. Washington bans them outright.

1
Washington State Department of Labor & Industries. Non-Compete Agreements
2
Washington State Legislature. Washington Code RCW 49.62.005 – Findings
3
Washington State Legislature. Washington Code RCW 49.62.010 – Definitions
4
Washington State Legislature. Washington Code Chapter 49.62 – Noncompetition Covenants
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Washington State Legislature. Washington Code RCW 49.62.020 – When Void and Unenforceable
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Washington State Legislature. Washington Code RCW 49.62.080 – Violation of This Chapter, Relief, Remedies
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Washington State Legislature. Washington Code 49.62.100 – Retroactive Application
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Washington State Legislature. Washington Code RCW 49.62.060 – Franchisor Restrictions on Hiring of Franchisee Employees