This is a sponsored column by attorneys John Berry and Kimberly Berry of Berry & Berry, PLLC, an employment and labor law firm located in Northern Virginia that specializes in federal employee, security clearance, retirement and private sector employee matters.
By John V. Berry, Esq.
Noncompete agreements in the Commonwealth of Virginia have undergone some changes since 2020. It’s very important to obtain legal advice before signing a noncompete agreement since noncompete issues often arise when an employee is facing termination from employment or a decision to leave an employer.
What is a Noncompete Agreement?
A noncompete agreement is a contract in which an employee agrees to give up a right that they would otherwise have in exchange for something from an employer. An employer often ties a noncompete agreement or clause to severance payments. The general purpose of a noncompete agreement is to ensure that a former employee does not use the knowledge they have gained with an employer and then later attempt to compete against them using this knowledge.
Virginia Requirements for Noncompete Agreements
In general, a noncompete agreement in Virginia must be reasonable to be valid. An agreement that restrains competition “must be evaluated on its own merits, balancing the provisions of the contract with the circumstances of the businesses and employees involved.” Omniplex World Servs. Corp. v. US Investigations Servs, 618 S.E.2d 340, 342 (2005).
According to the Virginia Supreme Court, in order to be enforceable, a noncompete agreement must meet a three-part test. Under this test, the employer bears the burden to show that the non-compete agreement or clause is:
- no greater than necessary to protect a legitimate business interest,
- is not unduly harsh or oppressive in curtailing an employee’s ability to earn a livelihood and
- is reasonable in light of sound public policy.
Modern Env’Ts v. Stinnett, 561 S.E.2d 694, 695 (Va. 2002); Assurance Data v. Malyevac, 747 S.E.2d 804, 808 (Va. 2013); Gordon v. Blue Mt. Therapy, 2021 U.S. Dist. LEXIS 105432 (W.D. Va. June 4, 2021).
Determining the enforceability of such an agreement “requires consideration of the agreement in terms of function, geographic scope and duration, with these factors considered together.” Home Paramount Pest Control Cos., Inc. v. Shaffer, 718 S.E.2d 762, 764 (Va. 2011).
When applying these tests in Virginia, the courts have become more employee friendly in recent years. Noncompete agreements that are too vague or cumbersome may be invalidated. Courts are more likely to enforce noncompete agreements that are reasonable, have a limited geographic scope and are precise in their terms.
Virginia Recently Barred Noncompete Agreements for Low-Wage Workers
Virginia has also added new protections for low-wage workers, exempting them from noncompete agreements. As of July 1, 2020, Virginia now prohibits employers from placing noncompete restrictions on low-wage employees. This law only applies to noncompete provisions that came into effect on or after July 1, 2020. See Virginia Code § 40.1-28.7:8.
When noncompete issues arise, it’s important to get legal advice early and not wait until issues develop. These types of agreements, even if already in effect, may be renegotiated. If you are employed in Virginia and have signed or are considering signing a noncompete agreement, you should seek the advice of a qualified Virginia employment lawyer.
If you are in need of advice regarding noncompete agreements or clauses, please contact our office at 703-668-0070 or through our contact page to schedule a consultation. Please also visit and like us on Facebook or Twitter.
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