The bill amends several sections of the Revised Code of Washington (RCW) related to noncompetition covenants, emphasizing the importance of workforce mobility for economic growth. It introduces new legal language that highlights the potential unreasonableness of agreements limiting competition or hiring, and asserts that the provisions in this chapter should be liberally construed to protect employees and independent contractors. Key definitions are clarified, including a broader definition of "noncompetition covenant" that now encompasses agreements that indirectly restrict business transactions with customers.
Additionally, the bill establishes stricter conditions under which noncompetition covenants are enforceable, such as requiring written disclosure of the covenant's terms at the time of employment offer and ensuring that the employee's earnings exceed a specified threshold. It also introduces provisions that make certain noncompetition clauses void if they require adjudication outside Washington or apply laws from other jurisdictions. The bill allows for legal recourse for individuals harmed by noncompetition covenants, including the possibility of statutory penalties and attorney fees. Overall, the amendments aim to enhance protections for employees and independent contractors against potentially exploitative noncompetition agreements.
Statutes affected: Original Bill: 49.62.005, 49.62.010, 49.62.020, 49.62.050, 49.62.080, 49.62.090
Substitute Bill: 49.62.005, 49.62.010, 49.62.020, 49.62.050, 49.62.080, 49.62.090
Bill as Passed Legislature: 49.62.005, 49.62.010, 49.62.020, 49.62.050, 49.62.080, 49.62.090
Session Law: 49.62.005, 49.62.010, 49.62.020, 49.62.050, 49.62.080, 49.62.090