If you live or work in Virginia and have signed a non-compete, or been asked to sign one, you need to fully understand what it means. Non-competes may be enforceable in Virginia, but the agreement has to meet certain requirements. Here’s what you should know about non-competes in Virginia.
What is a Noncompete Agreement?
This agreement or clause is a contractual promise between two parties, usually the employee and employer. These agreements are sometimes called “restrictive covenants” as well.
A noncompete agreement serves the purpose of guaranteeing that the former employee will not engage in certain acts, behaviors, or new employment that competes with the former employer’s business.
Why are Noncompete Agreements Used in Virginia?
Noncompete agreements are intended to ensure that employees won’t leverage information such as trade secrets, ideas, or business practices to start their own business or gain new employment. You can even be subject to a noncompete agreement if you don’t have access to trade secrets.
Are Non-Competes Legal in Virginia?
If you work in Virginia and signed a non-complete agreement, or a contract with a non-complete clause, it may be enforceable. To be enforceable, non-competes in Virginia have to be considered valid. These agreements are enforceable if the employer can show:
- The restriction is “no greater than is necessary to protect the employer’s legitimate business interest.”
- The agreement is not excessively severe or oppressive in restricting the employee’s ability to find another job or make an income; and
- The promise does not violate a clear mandate of Virginia public policy.
For courts to consider enforcing a noncompete agreement, they consider three things. This includes whether the time limitation placed on the worker is reasonable, whether the geographic limitations on the worker are reasonable, and whether the scope of limitation is “greater than is necessary to protect the employer’s legitimate business interest.”
Many non-compete agreements are overly broad and will not be enforced by the courts. However, litigation is expensive, even if you win, so avoiding it can be important. There is currently a legal battle going on with federal regulations that ban non-competes, and at least one court which has struck down that regulation. It is expected that the incoming Trump Administration will withdraw the regulation and non-competes will remain legal under federal law.
Many states are beginning to regulate non-competes. Virginia does not permit non-competes for “low wage workers,” currently defined as those making under about $70,000 per year.
Non-compete agreements are often accompanied by non-solicitation agreements. Those prohibit you from soliciting work from clients of your former employer, usually for a year. Those restrictions are generally enforceable. Trade secrets laws and other common law and statutory remedies that prohibit taking non-public information from your former employer and giving it to your new employer are generally enforceable.
Lawyer for Enforcement of Noncompete Agreements in Virginia
If you have signed a noncompete agreement, or are considering signing a noncompete agreement, you should speak to an attorney and discern whether or not the noncompete agreement is legal and enforceable.
If you are in need of an attorney’s advice, please contact Cook, Craig, and Francuzenko today. Our firm has attorneys who specialize in a variety of practice areas. With over 100 years of combined experience, we are seasoned professionals ready to help you.
