Case Description
The Attorney General of Washington has entered into a series of agreements with 75 national chains who included so-called “no-poach” provisions in their franchise agreements. No-poach clauses appear in franchise agreements between owners of franchises and corporate headquarters. The clauses prohibit employees from moving among stores in the same corporate chain, a practice that economists believe stagnates wages. For example, the clauses would prohibit an employee at one Wetzel’s Pretzels location from accepting employment from another Wetzel’s Pretzels franchise location for higher pay. The attorney general’s office is seeking to eliminate all no-poach clauses nationwide. The settlement require that the corporations no longer include no-poach language in new franchise agreements. Additionally, the companies will no longer enforce no-poach provisions currently included in franchise agreements at their locations nationwide where tens of thousands of workers are employed. Finally, the companies must remove current no-poach clauses from their Washington
contracts within 120 days of the agreement, and from their nationwide contracts as they come up for renewal.
