On March 4, 2026, the Virginia General Assembly approved Senate Bill No. 170, which limits the enforceability of restrictive covenants, or non-compete clauses, for certain terminated employees. If signed by the Governor, the bill would invalidate non-competes for employees who are laid off without severance benefits or other monetary payment, unless they are terminated for cause. The severance benefits or monetary payment must be disclosed to the employee upon execution of the restrictive covenant. Under the measure, employers could no longer enforce non-compete clauses with healthcare professionals licensed, registered or certified by state regulatory boards.
Non-compete clauses limit where an employee can work after leaving a job, particularly preventing them from going to work for local competitors, and have become routine in many healthcare contracts.
The bill amends Virginia’s existing non-compete statute by broadening the scope of relief available beyond low-wage employees. The state expanded the definition of “low-wage” last year in the current ban on non-competes for healthcare employees. It now applies to workers earning just under $80,000 a year.
Senate Bill 170 allows for any employee to bring a civil action against an employer that attempts to enforce a non-compete in violation of the law. If the court finds a violation of the statute, employees could be entitled to injunctive relief, liquidated damages, lost compensation, other damages, as well as reasonable...
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