Beginning July 1, 2025, Virginia will provide even more protection to workers against the enforcement of noncompete agreements. Since 2020, Virginia law has prohibited employers from entering into, enforcing, or threatening to enforce a covenant not to compete against a “low-wage employee” (currently any employee earning less than $76,081 per year). However, an amendment to the existing law expands the definition of “low-wage employee” to also include any worker who is classified as nonexempt under the Fair Labor Standards Act (FLSA).

Quick Hits

• On March 24, 2025, Virginia Governor Glenn Youngkin signed SB128 into law, which significantly expands the existing scope of protection to low-wage employees against the enforcement of noncompete agreements.
• Starting on July 1, 2025, covenants not to compete will be prohibited against any employee who qualifies as a “low-wage employee,” meaning any employee who (i) earns less than the average weekly wage in Virginia (currently $1,463.10 weekly or $76,081 annually) or (ii) is entitled to overtime compensation under the FLSA.
• Employers that enter into, enforce, or threaten to enforce a covenant not to compete against a low-wage employee could be subject to injunctive relief, the payment of damages (including liquidated damages), attorneys’ fees, costs, and a civil penalty of $10,000 per violation.
• Covenants not to compete that were entered into (or renewed) before July 1, 2025, are not affected by the changes in the law.

Summary...

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