Virginia Non-Compete Laws (2026): Are Non-Competes Enforceable?

Virginia does not ban non-competes for every worker, but it bans them outright for two groups. Under Va. Code 40.1-28.7:8, "No employer shall enter into, enforce, or threaten to enforce a covenant not to compete with any low-wage employee or health care professional." For everyone else, Virginia courts apply a strict reasonableness test, and the employer must prove the restraint is no greater than necessary to protect a legitimate business interest.

Two 2026 laws added new limits for agreements signed on or after July 1, 2026: a ban for licensed health care professionals, and a rule that a non-compete cannot be enforced against a worker fired without cause unless the employer pays severance or other money disclosed at signing. For how other states compare, see our non-compete laws by state guide.

Information last verified on 2026-10-08. This article has not been reviewed by a licensed lawyer.

Jurisdiction scope: This article covers Virginia law on employee non-compete agreements: Va. Code 40.1-28.7:8 as amended by Acts 2025 ch. 585 and Acts 2026 chs. 883, 1113 and 1114, and the common-law reasonableness test from the Supreme Court of Virginia, with a short note on the federal FTC rule. It does not cover trade-secret claims (see Virginia trade secret laws) or how severance is paid (see Virginia severance pay laws).

Are non-competes enforceable in Virginia?

It depends on who you are and when you signed. Virginia has three layers of rules, and a single agreement can fall under more than one.

Who counts as a "low-wage employee"

The statutory ban turns on this definition, and it is broader than the name suggests. Under Va. Code 40.1-28.7:8, a low-wage employee includes:

• An employee whose average weekly earnings are below the Commonwealth's average weekly wage. Earnings are averaged over the 52 weeks before the job ended, or over the weeks actually paid if fewer than 52. The benchmark is the average weekly wage under Va. Code 65.2-500(B).
• Anyone entitled to federal overtime pay under 29 U.S.C. 207 for hours over 40 in a workweek, regardless of earnings. Acts 2025 ch. 585 (SB 1218) added this group effective July 1, 2025.
• Interns, students, apprentices and trainees, paid or unpaid.
• Independent contractors paid an hourly rate below the median hourly wage for Virginia published by the U.S. Bureau of Labor Statistics for the preceding year.

The definition excludes employees whose earnings come in whole or in predominant part from sales commissions, incentives or bonuses.

The 2026 dollar figure

The average weekly wage changes every year. The Virginia Department of Labor and Industry's 2026 notice states that the term has been calculated by the Virginia Department of Workforce Development and Advancement "to include all employees who earn an average of less than $1,507.01 per week." That figure applies for 2026; the Department publishes a new notice each year.

Overtime-eligible workers: which agreements

The overtime group does not reach every existing agreement. The Department of Labor and Industry states: "This expanded coverage does not apply to contracts, covenants, or agreements entered into prior to July 1, 2025." An overtime-eligible worker who earns above the weekly figure and signed before that date is judged under the earnings test and the common law.

Health care professionals (agreements from July 1, 2026)

Acts 2026 ch. 1113 (HB 627) and ch. 1114 (SB 128), both approved May 14, 2026 and effective July 1, 2026, extended the same ban to health care professionals. The statute covers persons licensed, registered or certified by the Boards of Medicine, Nursing, Counseling, Optometry, Psychology or Social Work.

The ban is prospective. The enactment clause of ch. 1113 provides that nothing in the act invalidates, alters or affects any contract, covenant or agreement entered into or renewed before July 1, 2026. Unlike the discharge rule below, that clause does not mention agreements that are "amended."

The 2026 law also lets health care employers keep some protections:

• Sale of a practice. A non-compete or similar covenant with a health care professional or the professional's business entity is allowed in the sale of all or substantially all of the operating assets plus goodwill, a division's or subsidiary's operating assets plus goodwill, or the ownership interest, "provided that such covenant not to compete or similarly restrictive covenant is reasonable in scope, duration, and geographic area."
• Recruitment costs. An employer may require repayment of recruitment costs, such as relocation, signing or retention bonuses, and recruiting, education or training expenses, "from a departing health care professional who has been employed for fewer than five years."
• Customer non-solicitation. A health care employer may include a narrowly construed customer non-solicitation provision.

Our site covered the bill in more detail in Virginia's health care non-compete ban, HB 627.

Fired without cause: the severance rule (from July 1, 2026)

Acts 2026 ch. 883 (SB 170), approved April 13, 2026 and effective July 1, 2026, added a rule that applies to all employees, not only low-wage workers:

"No covenant not to compete between an employer and an employee is enforceable if such employer discharges such employee from employment without providing severance benefits or other monetary payment to such employee, unless such employer discharges such employee for cause." Va. Code 40.1-28.7:8

The severance or other payment the employer relies on "shall be disclosed upon execution of the covenant not to compete." The text our research read does not set a minimum amount.

This rule is also prospective. Its enactment clause states: "That nothing in this act shall invalidate, alter, or otherwise affect any contract, covenant, or agreement entered into, amended, or renewed prior to July 1, 2026." For an older agreement, a firing without cause does not trigger this statutory rule; a court applies the common-law test. See Virginia's SB 170 non-compete law for background, and Virginia at-will employment laws for when an employer can end the job in the first place.

If you quit, the discharge rule does not apply; the low-wage and health care bans and the common-law test still do.

The common-law test for everyone else

Outside the statutory bans, the Supreme Court of Virginia decides enforceability case by case. In Motion Control Systems, Inc. v. East, 262 Va. 33 (2001), the court described non-competes as restraints on trade that are not favored and are strictly construed, and said:

"The employer bears the burden to show that the restraint is reasonable and no greater than necessary to protect the employer's legitimate business interests." Motion Control Systems, Inc. v. East, 262 Va. 33 (2001)

In Home Paramount Pest Control Companies, Inc. v. Shaffer, Record No. 101837 (Va. Nov. 4, 2011), the court held that a non-compete is enforceable only if it is narrowly drawn to protect the employer's legitimate business interest, is not unduly burdensome on the employee's ability to earn a living, and is not against public policy, with the employer bearing the burden on each. The court weighs three elements together:

• Function: what kinds of work the covenant bars.
• Geographic scope: where.
• Duration: for how long.

Weighing them together does not let a short, local covenant save an overly broad one. In Home Paramount, the court said "the clear overbreadth of the function here cannot be saved by narrow tailoring of geographic scope and duration."

Enforceability is usually decided on evidence, not on the pleadings alone. In Assurance Data, Inc. v. Malyevac, Record No. 121989 (Va. Sept. 12, 2013), the court held that "a demurrer cannot be used to decide on the merits whether a restraint on competition is enforceable," and reversed the circuit court's judgment.

What a court does with an overbroad covenant

For a covenant that violates the statute, Va. Code 40.1-28.7:8 provides: "The court shall have jurisdiction to void any covenant not to compete with an employee or health care professional."

For other covenants, no published Virginia appellate decision settles whether a court may narrow ("blue pencil") an overbroad covenant. In C&A Scientific Co. v. Yu, Record No. 0981-25-4 (Va. Ct. App. Aug. 18, 2026), the Court of Appeals noted that various federal courts and Virginia circuit courts have concluded Virginia courts have no authority to blue pencil or rewrite the contract, but it declined to decide whether those rulings are correct. The Home Paramount holding shows the court will not let narrow time and geography rescue an overbroad scope of work. A lawyer licensed in Virginia can explain how courts handle a specific clause.

Suing and penalties under the statute

An employee or health care professional can bring a civil action under Va. Code 40.1-28.7:8 against a former employer or other person that tries to enforce a covenant in violation of the section. Since Acts 2026 ch. 883 (SB 170), that right is not limited to low-wage employees, so it also reaches an employee discharged without cause in violation of the severance rule. The court may void the covenant and order relief that includes an injunction, liquidated damages, lost compensation, damages, and reasonable attorney fees and costs. A prevailing plaintiff recovers costs including expert and attorney fees.

The statute states: "An action under this section shall be brought within two years of the latter of" these events:

• the covenant was signed;
• the employee learned of it;
• the employment ended; or
• the employer took a step to enforce it.

An employer may not retaliate against a low-wage employee or health care professional for bringing an action. Separately, the Commissioner of Labor and Industry may assess a civil penalty "of $10,000 for each violation," paid to the state's general fund.

Posting rule. Employers must post a copy of 40.1-28.7:8, or a summary approved by the Department of Labor and Industry, with their other required workplace notices. The penalty is a warning for a first violation, up to $250 for a second, and up to $1,000 for a third and each later violation.

The Department of Labor and Industry lists laborlaw@doli.virginia.gov for questions about the 2025 coverage change. Our research did not find a standalone non-compete complaint form.

Non-solicits, NDAs and trade secrets

• Confidentiality agreements. The statute does not limit nondisclosure agreements intended to prohibit taking, misappropriating, threatening to misappropriate or sharing trade secrets (as defined in Va. Code 59.1-336) or proprietary or confidential information.
• Serving customers. Under the statute's definition, a covenant not to compete does not restrict an employee from providing a service to a customer or client of the employer if the employee does not initiate contact with or solicit that customer or client.
• No-poach clauses. Our research did not find a Virginia rule on agreements not to hire co-workers.

Trade-secret law is separate from any covenant; it protects confidential information whether or not you signed anything. See Virginia trade secret laws.

Choice of law, notice and garden leave

The text of 40.1-28.7:8, read in full, contains no ban on out-of-state choice-of-law or forum clauses, no rule requiring advance notice before signing, and no garden-leave pay requirement. Other titles of the Virginia Code were not searched for those topics, so treat that as a limited finding.

Recent changes

• SB 1218 (2025), Acts 2025 ch. 585, enacted. Added overtime-eligible workers to the low-wage definition, effective July 1, 2025, for agreements entered into on or after that date.
• SB 170 (2026), Acts 2026 ch. 883, enacted. Approved April 13, 2026, effective July 1, 2026. The discharge-without-severance rule, for agreements entered into, amended or renewed on or after July 1, 2026.
• HB 627 (2026), Acts 2026 ch. 1113, enacted. Approved May 14, 2026, effective July 1, 2026. The health care professional ban and the sale-of-practice and recruitment-cost carve-outs, for agreements entered into or renewed on or after July 1, 2026.
• SB 128 (2026), Acts 2026 ch. 1114, enacted. The companion health care bill, approved May 14, 2026, effective July 1, 2026.

We did not enumerate other 2026 non-compete bills that failed or any bills prefiled for the 2027 session.

The federal FTC rule

The FTC's nationwide non-compete rule never took effect. A federal court in Texas set it aside on August 20, 2024 (Ryan, LLC v. FTC, No. 3:24-CV-00986-E, N.D. Tex.), the FTC voted on September 5, 2025 to dismiss its appeals, and the rule was removed from the Code of Federal Regulations effective February 12, 2026. The FTC still acts case by case; on June 22, 2026 it approved a final order requiring a pest-control company to stop enforcing non-competes. See FTC non-compete ban struck down and the non-compete laws by state guide.

What this means if you signed one

Start with three facts: your pay and overtime status, your license if you work in health care, and the date the agreement was signed, amended or renewed. Those decide whether the statutory ban or the discharge rule can apply. If neither does, a court weighs the function, geography and duration of the covenant, with the employer carrying the burden. A lawyer licensed in Virginia can review a specific agreement.

Related

• Non-compete laws by state
• Virginia trade secret laws
• Virginia severance pay laws
• Virginia at-will employment laws
• Virginia's SB 170 non-compete law

Disclaimer: This article provides general legal information about Virginia non-compete law, including Va. Code 40.1-28.7:8 and the Supreme Court of Virginia's reasonableness test, not legal advice. The information was last verified on 2026-10-08. The Virginia Department of Labor and Industry assesses the statute's civil penalties; for advice about a specific agreement, contact a legal aid office or a lawyer licensed in Virginia.

Last updated: 2026-10-08.

Frequently Asked Questions

Are non-competes enforceable in Virginia?

Not against low-wage employees, and not against health care professionals for agreements entered into or renewed on or after July 1, 2026 (Va. Code 40.1-28.7:8). For other workers, a court enforces one only if the employer proves it is reasonable and no greater than necessary to protect a legitimate business interest.

What is the low-wage threshold for Virginia non-competes in 2026?

The Virginia Department of Labor and Industry's 2026 notice covers employees who earn an average of less than $1,507.01 per week. The figure is tied to the Commonwealth's average weekly wage and is republished each year.

Can an overtime-eligible worker in Virginia be bound by a non-compete?

Not under an agreement entered into on or after July 1, 2025. Acts 2025 ch. 585 made anyone entitled to federal overtime under 29 U.S.C. 207 a low-wage employee regardless of earnings; the Department of Labor and Industry says the change does not apply to earlier agreements.

Is my non-compete void if I was fired in Virginia?

For an agreement entered into, amended or renewed on or after July 1, 2026, Va. Code 40.1-28.7:8 makes it unenforceable if you were discharged without cause and without severance or other monetary payment disclosed at signing. Older agreements are judged under the common-law test.

Does Virginia ban non-competes for nurses and doctors?

Yes, for agreements entered into or renewed on or after July 1, 2026, with persons licensed, registered or certified by the Boards of Medicine, Nursing, Counseling, Optometry, Psychology or Social Work (Acts 2026 ch. 1113 and 1114). A covenant tied to the sale of a practice remains allowed if reasonable in scope, duration and geographic area.

Can an independent contractor be covered by Virginia's ban?

Yes, if paid an hourly rate below the median hourly wage for Virginia published by the U.S. Bureau of Labor Statistics for the preceding year (Va. Code 40.1-28.7:8).

How long do I have to sue over an illegal non-compete in Virginia?

Two years from the latest of signing, learning of the covenant, the end of employment, or the employer's step to enforce it (Va. Code 40.1-28.7:8).

Does Virginia law restrict non-solicitation or confidentiality agreements?

The statute does not limit nondisclosure agreements that protect trade secrets or confidential information. Its definition provides that a covenant not to compete does not restrict serving a customer the employee did not contact or solicit.

Does the FTC non-compete ban apply in Virginia?

No. A federal court set the FTC rule aside on August 20, 2024, and it was removed from the Code of Federal Regulations effective February 12, 2026. Virginia law governs.