Are non-compete agreements enforceable in Virginia?
1. Baseline Rule. Two parallel regimes: (a) Va. Code § 40.1-28.7:8 (effective July 1, 2020) bans non-competes outright for "low-wage employees"; (b) for other workers, Virginia common law strictly construes covenants. Omniplex World Services Corp. v. US Investigations Services, 270 Va. 246 (2005), and Home Paramount Pest Control v. Shaffer, 282 Va. 412 (2011), set the framework.
2. Reasonableness Factors. Three-prong test: the covenant must be (a) narrowly drawn to protect the employer's legitimate business interest, (b) not unduly burdensome on the employee's ability to earn a living, and (c) not against public policy. Ambiguity is construed against the employer (drafter).
3. Consideration. Continued at-will employment is sufficient.
4. Wage Thresholds. Va. Code § 40.1-28.7:8 defines "low-wage employee" as one whose average weekly earnings are less than the average weekly wage of Virginia (approximately $1,410/week or $73,320/year in 2025, adjusted annually by the Virginia Employment Commission). Independent contractors paid by the hour at less than the median earn the same protection.
5. Blue Pencil / Reformation. Virginia is among the strictest non-blue-pencil states. Under Home Paramount, an overbroad covenant is void in its entirety — courts will not rewrite. This makes drafting precision critical.
6. Industry Carve-Outs. Lawyers barred by Va. RPC 5.6. Statutory ban includes most workers earning under the threshold.
7. Notice Requirement. Employers must post a copy of § 40.1-28.7:8 or a summary in the workplace; failure can result in a $10,000 civil penalty.
8. Remedies. Low-wage employees may sue within 2 years of the later of (a) signing, (b) becoming aware, (c) attempted enforcement, or (d) separation — and recover damages, attorneys' fees, and liquidated damages.
9. FTC Rule. Enjoined nationwide by Ryan LLC v. FTC (E.D. Tex. Aug. 2024); on appeal.
10. Choice of Law. Virginia courts apply VA law where another state's law would offend VA public policy.
This is legal information, not legal advice.
- Your earnings are near the low-wage threshold and the employer seeks to enforce
- Your covenant lacks any geographic limit or restricts any industry role
- Employer failed to post the required workplace notice
- Va. Code § 40.1-28.7:8 (low-wage non-compete ban)
- Home Paramount Pest Control v. Shaffer, 282 Va. 412 (2011)
- Omniplex World Services Corp. v. US Investigations Services, 270 Va. 246 (2005)
This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.