Virginia Non-Compete Agreement Overview
Virginia enforces non-compete agreements subject to reasonableness requirements but enacted significant protections for low-wage workers effective July 1, 2020. Under Virginia Code Section 40.1-28.7:8, employers cannot enter into or enforce non-compete agreements with low-wage employees — defined as employees whose average weekly earnings are less than the average weekly wage of the Commonwealth (approximately $1,343/week or ~$69,836/year in 2024). Violations can result in civil penalties of $10,000 per violation.
For employees who earn above the threshold, Virginia courts evaluate non-competes under a traditional reasonableness framework, considering the function and geographic scope of the restriction, the duration, and whether the restriction is narrowly drawn to protect the employer's legitimate business interest. Virginia has historically taken a strict approach — the state was traditionally considered an all-or-nothing (red-pencil) state where courts would not reform overbroad agreements. However, more recent case law has shown some willingness to partially enforce or narrow restrictions, and the trend is moving toward blue-penciling.
Enforceable
Enforceability
No statutory cap
Max duration
Yes
Blue-pencil
Continued employment generally sufficient
Consideration
Virginia Enforceability Requirements
Understanding Virginia's specific rules is essential for drafting an enforceable non-compete agreement. The following provisions apply in Virginia.
Key Provisions
- Non-competes BANNED for low-wage workers earning below average weekly wage (~$69,836/year for 2024)
- Violations of the low-wage ban: $10,000 civil penalty per occurrence
- For higher-earning employees, traditional reasonableness analysis applies
- Must protect a legitimate business interest
- Historically an all-or-nothing state, but moving toward blue-penciling
- Duration and geographic scope must be reasonable
- Post-termination restrictions are enforceable if reasonable
How to Draft a Non-Compete in Virginia
Follow these steps to create an enforceable non-compete agreement that complies with Virginia law.
Verify State Requirements
Confirm that your non-compete complies with Virginia's enforceability standards, including any income thresholds, duration caps, and procedural requirements.
Define Restricted Activities Narrowly
Be specific about what activities are restricted. Broad prohibitions are more likely to be struck down or modified by Virginia courts.
Set Reasonable Geographic Scope
Limit the geographic restriction to areas where your company actually operates or where the employee had client responsibility in Virginia.
Provide Adequate Consideration
Ensure the employee receives adequate consideration for the non-compete restriction. In Virginia, continued employment generally sufficient.
Include Severability and Signatures
Add a severability clause and get proper signatures from both parties. In Virginia, this helps protect the enforceable portions of the agreement if any provision is found overbroad.
Recent Legal Changes in Virginia
Virginia's ban on non-competes for low-wage workers took effect July 1, 2020. The income threshold is tied to the average weekly wage and adjusts periodically. This was a significant change providing protections for lower-earning workers while maintaining enforcement for higher earners.
Employer Tips for Virginia
Verify the employee earns above the average weekly wage threshold before requiring a non-compete. Draft narrowly — Virginia courts have historically been strict. Include clear definitions of restricted activities and geographic scope. Consider using NDAs and non-solicitation agreements for lower-earning employees.
Employee Rights in Virginia
If you earn below the average weekly wage (~$69,836/year), your non-compete is void and your employer faces penalties for attempting to enforce it. Higher-earning employees can challenge overbroad agreements. Virginia courts have historically been strict about enforcing only narrowly drafted agreements. Consult an attorney.
Sample Virginia Non-Compete Agreement
Below is a preview of our Virginia-specific non-compete agreement. Your customized document will include all provisions required for enforceability in Virginia.
NON-COMPETE AGREEMENT
STATE OF VIRGINIA
Covenant Not to Compete
EMPLOYER:
Company Name: [Legal Entity Name]
Address: [Virginia Address]
Business Type: [Industry]
EMPLOYEE:
Name: [Full Legal Name]
Position: [Job Title]
Start Date: [Date]
NON-COMPETE TERMS
Restricted Activities: [Specific Activities]
Geographic Scope: [Area]
Duration: [Time Period] following termination
Consideration: [What Employee Receives]
Governing Law: State of Virginia
Virginia Non-Compete Agreement FAQ
Answers to common questions about non-compete agreements in Virginia, including enforceability, duration limits, and employee rights.
Official Virginia Resources
Use these official resources to verify Virginia non-compete enforceability rules and access state employment law information.
Virginia Department of Labor
State labor law information and employment resources
Virginia Attorney General
Consumer protection and employment law guidance
FTC Non-Compete Rulemaking
Federal non-compete rule status and developments
ABA Labor and Employment Law
American Bar Association employment law resources
Related Virginia Documents
Depending on your situation, you may need additional documents alongside your Virginia non-compete agreement.
Virginia Non-Disclosure Agreement
Protect confidential information and trade secrets
Virginia Non-Solicitation Agreement
Prevent poaching of clients and employees
Virginia Employment Agreement
Comprehensive employment terms and conditions
Virginia Severance Agreement
Separation terms with non-compete provisions
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