Washington's restrictive covenant framework is about to change dramatically, which will elevate the practical importance of Washington's trade secret law.
Current law (through June 29, 2027). Chapter 49.62 RCW, enacted in 2019, permits noncompetition covenants only where the worker's earnings exceed an inflation-adjusted threshold — for 2026, $126,858.83 for employees and $317,147.09 for independent contractors. RCW 49.62.020, .030, .040. The statute imposes disclosure requirements (terms must be disclosed no later than initial acceptance of the offer, with independent consideration if entered after commencement), a presumptive 18-month duration limit, and choice-of-law protections. Amendments passed in 2024 expanded "noncompetition covenant" to include agreements that directly or indirectly prohibit the acceptance or transaction of business with a customer; narrowed the nonsolicitation carve-out to current customers; and limited the sale-of-business exception to persons transacting in an interest representing one percent or more of the business. Those amendments apply retroactively.
HB 1155 (effective June 30, 2027). Engrossed Substitute House Bill 1155, signed March 23, 2026, voids all noncompetition covenants with employees and independent contractors regardless of execution date, eliminating the income-threshold framework entirely. Its expanded definition of "noncompetition covenant" captures customer nonservicing provisions and forfeiture-for-competition provisions — the latter reaching agreements requiring return, repayment, or forfeiture of any right, benefit, or compensation because of engaging in a lawful profession, trade, or business. The statute directs that its protections be liberally construed and its exceptions narrowly construed. Employers must provide written notice to affected current and former workers by October 1, 2027. The Attorney General has enforcement authority; private plaintiffs may recover the greater of actual damages or $5,000, plus fees and costs. Actions filed before June 30, 2027 are not subject to the amendments.
What survives. HB 1155 preserves confidentiality agreements, covenants prohibiting the use or disclosure of trade secrets or inventions, sale-of-business noncompetes, and franchise covenants. It also permits nonsolicitation agreements — of employees, and of current or prospective customers, patients, or clients with whom the worker established or substantially developed a direct relationship — subject to an 18-month maximum.
The strategic consequence. Once noncompetes are void, the employer's protectable interest in competitively sensitive information must be vindicated through (i) contract — confidentiality and invention assignment; (ii) a permissible nonsolicitation covenant; and (iii) WUTSA or the DTSA. Given Rucker's holding that memorized customer information is protectable, trade secret law will bear substantially more of the load than it has to date. Practitioners should expect a rise in WUTSA filings, in the sophistication of onboarding and offboarding forensics, and in fights over the boundary between an employee's general skill and knowledge and the employer's protectable secrets.