Virginia has been rapidly strengthening its employee protections against non-compete agreements. If you work in Virginia, you may have significantly more protection than you realize — particularly if you were laid off or terminated.
Virginia's Salary Threshold — Overtime-Eligible Workers
Virginia law prohibits non-compete agreements for "low-wage employees" — but the definition has expanded significantly. As of July 1, 2025, non-competes are prohibited for any employee who is entitled to overtime under the federal Fair Labor Standards Act (FLSA), regardless of their actual weekly pay.
This is a significant expansion. Under the FLSA, most hourly workers and many salaried workers earning less than $684 per week ($35,568 annually) are entitled to overtime — meaning their non-competes are void under Virginia law. The 2026 threshold for "low-wage employees" is $78,364 annually.
✅ If you are an hourly worker or a salaried employee earning less than approximately $78,364 per year, your non-compete is very likely void and unenforceable under Virginia law. Employers who attempt to enforce void non-competes face penalties including attorneys' fees.
Major New Law — Effective July 1, 2026
Virginia Senate Bill 170 was signed into law in April 2026 and takes effect July 1, 2026. This law adds a powerful new protection: non-compete agreements become unenforceable against employees who are terminated without severance benefits or other monetary payment — unless the employee was terminated for cause.
In practical terms, this means:
- If you were laid off and your employer did NOT pay you severance, your non-compete may be unenforceable
- If you were terminated without cause and received no severance, your non-compete may be void
- If you were terminated for cause (documented misconduct), the non-compete may still apply
- This law applies to agreements entered into, amended, or renewed after July 1, 2026
⚠️ The July 1, 2026 law applies to new and renewed agreements — not agreements signed before that date. If you signed your non-compete before July 1, 2026, check with an employment attorney about whether this new protection applies to your situation.
For Higher-Earning Employees
For employees above the salary threshold whose non-competes are not covered by the new protections, Virginia courts apply a reasonableness standard. Non-competes must be narrowly tailored to protect a legitimate business interest and must be reasonable in duration, geographic scope, and scope of restricted activity.
Virginia courts consider:
- Whether the restriction is no greater than necessary to protect the employer's legitimate interest
- Whether the restriction imposes an undue hardship on the employee
- Whether the restriction harms the public
Penalties for Employers
Virginia takes its non-compete restrictions seriously. Employers who violate the low-wage employee prohibition can be required to pay the employee's attorneys' fees and court costs — a meaningful deterrent that gives employees real leverage.