Virginia would void employee noncompetes for workers who are laid off without severance or other compensation, under a bill headed to Gov. Abigail Spanberger (D) for her signature.
The legislation (SB 170) would declare the contracts unenforceable when an employer discharges a worker without severance, except in “for cause” terminations. It doesn’t specify a minimum required amount of compensation. The state House passed the bill Wednesday, after the Senate previously approved it Feb. 6.
The restrictions would apply to noncompete contracts signed on or after July 1, 2026.
The Virginia legislature has been advancing a slew of employment related bills in recent weeks. It recently passed a measure that would require pay range disclosures in job postings.
The state already bans businesses from imposing covenants not-to-compete on hourly workers who aren’t exempt from the federal Fair Labor Standards Act, as well as workers who make less than the state’s average weekly wage. That figure for 2026 is $1,501 per week, or $78,364 annually, according to the state’s labor department.
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