VirginiaSB1702026 Regular SessionSenateWALLET

Protection of employees; covenants not to compete, discharged employees.

Sponsored By: Jeremy S. McPike (Democratic)

Became Law

Summary

Protection of employees; covenants not to compete; discharged employees. Provides that no covenant not to compete, as such term is defined in existing law, 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 that is disclosed upon execution of the covenant not to compete, unless the employee is discharged for cause. This bill incorporates SB 569.

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Bill Overview

Analyzed Economic Effects

5 provisions identified: 2 benefits, 0 costs, 3 mixed.

No noncompetes for low-wage workers

If you are a low‑wage worker in Virginia, your employer cannot make, enforce, or threaten a noncompete. You count as low‑wage if your weekly pay is below Virginia’s average, if you are overtime‑eligible, an intern/student/apprentice/trainee, or an independent contractor paid below Virginia’s median hourly wage. Workers paid mainly by sales commissions, incentives, or bonuses are not covered. You can sue within two years, counted from the latest of signing, learning of it, job loss, or any enforcement step. A court can cancel the covenant, award lost pay or liquidated damages, and require the employer to pay your reasonable attorney and expert fees; employers cannot retaliate. The state can also fine employers $10,000 per violation.

Noncompete void if fired without severance

If your employer fires you without severance or other monetary payment, your noncompete is not enforceable. This does not apply if you were fired for cause. Any severance or other promised payment must be disclosed when you sign the noncompete.

Pre-July 2026 agreements stay unchanged

Contracts, covenants, and agreements made, amended, or renewed before July 1, 2026 are not changed by this act. Older deals, including noncompetes and NDAs, keep their current terms. New protections and penalties in this act do not change those earlier agreements.

Workplaces must post noncompete rights

Employers must post this law or a state‑approved summary where other employee notices are posted. First failure gets a written warning. A second failure can be fined up to $250. A third or later failure can be fined up to $1,000. The Commissioner sets payment rules and may allow a negotiated payment without admitting liability.

NDAs and trade secrets still protected

This law does not stop employers from using nondisclosure agreements. NDAs can still protect trade secrets and other confidential information. The limits here apply to noncompete agreements, not NDAs.

Sponsors & Cosponsors

Sponsor

  • Jeremy S. McPike

    Democratic • Senate

Cosponsors

There are no cosponsors for this bill.

Roll Call Votes

All Roll Calls

Yes: 227 • No: 16

House vote 3/4/2026

Passed House

Yes: 87 • No: 12

House vote 2/27/2026

Reported from Appropriations

Yes: 18 • No: 4

House vote 2/24/2026

Reported from Labor and Commerce and referred to Appropriations

Yes: 22 • No: 0

House vote 2/19/2026

Subcommittee recommends reporting

Yes: 7 • No: 0

Senate vote 2/6/2026

Read third time and passed Senate Block Vote

Yes: 40 • No: 0

Senate vote 2/5/2026

Engrossed by Senate Block Vote (Voice Vote)

Yes: 0 • No: 0

Senate vote 2/5/2026

Commerce and Labor Substitute agreed to

Yes: 0 • No: 0

Senate vote 2/4/2026

Passed by for the day Block Vote (Voice Vote)

Yes: 0 • No: 0

Senate vote 2/4/2026

Constitutional reading dispensed Block Vote (on 1st reading)

Yes: 40 • No: 0

Senate vote 2/2/2026

Reported from Commerce and Labor with substitute

Yes: 13 • No: 0

Actions Timeline

  1. Acts of Assembly Chapter text (CHAP0883)

    4/13/2026Governor
  2. Approved by Governor-Chapter 883 (effective 7/1/2026)

    4/13/2026Governor
  3. Governor's Action Deadline 11:59 p.m., April 13, 2026

    3/14/2026Governor
  4. Enrolled Bill communicated to Governor on March 14, 2026

    3/14/2026Senate
  5. Fiscal Impact Statement from Department of Planning and Budget (SB170)

    3/11/2026Senate
  6. Bill text as passed Senate and House (SB170ER)

    3/10/2026Senate
  7. Enrolled

    3/10/2026Senate
  8. Signed by President

    3/10/2026Senate
  9. Signed by Speaker

    3/10/2026House
  10. Passed House (87-Y 12-N 0-A)

    3/4/2026House
  11. Read third time

    3/4/2026House
  12. Read second time

    3/3/2026House
  13. Reported from Appropriations (18-Y 4-N)

    2/27/2026House
  14. Assigned HAPP sub: Commerce Agriculture & Natural Resources

    2/25/2026House
  15. Reported from Labor and Commerce and referred to Appropriations (22-Y 0-N)

    2/24/2026House
  16. Subcommittee recommends reporting (7-Y 0-N)

    2/19/2026House
  17. Assigned HCL sub: Subcommittee #2

    2/17/2026House
  18. Referred to Committee on Labor and Commerce

    2/12/2026House
  19. Read first time

    2/12/2026House
  20. Placed on Calendar

    2/12/2026House
  21. Fiscal Impact Statement from Department of Planning and Budget (SB170)

    2/10/2026Senate
  22. Read third time and passed Senate Block Vote (40-Y 0-N 0-A)

    2/6/2026Senate
  23. Engrossed by Senate Block Vote (Voice Vote)

    2/5/2026Senate
  24. Commerce and Labor Substitute agreed to

    2/5/2026Senate
  25. Engrossed by Senate - committee substitute Block Vote (Voice Vote)

    2/5/2026Senate

Bill Text

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