The new state law reflects a trend among other states including New Hampshire, Maine, Maryland, Oregon, and Rhode Island to enact noncompetition legislation.

Key Points:

Under Washington State’s new noncompetition law, effective January 1, 2020:

..Noncompetition covenants are only enforceable with employees who earn in excess of $100,000 per year and independent contractors who earn in excess of $250,000 per year.

..Any noncompetition covenant exceeding 18 months post-termination is presumed to be unreasonable and unenforceable.

..If an employee is terminated as a result of a layoff, they must be compensated during the noncompetition period in order for the covenant to be enforceable.

..independent consideration must be provided to existing employees entering into noncompetition covenants.

..Agreements requiring the application of non-Washington law or adjudication outside of Washington are void.

..Noncompetition covenants entered into before 2020 must comply with the new law.

..Employers face penalties for noncompetition covenants that do not comply with the new law.