“Covenant Not to Compete” Prohibited as to Low-Wage Employees (June 2020)

• The new law defines ‘covenant not to compete’ and ‘low-wage employee.’
  • ‘Covenant not to compete’ is defined as an “…agreement that restrains, prohibits, or otherwise restricts an individual’s ability to compete with his former employer.”
  •  ‘Low wage employees’ are defined as those whose average weekly earnings are less than the average weekly earnings in Virginia, those who are employed without pay, or contractors whose hourly wage falls below the average hourly wage in Virginia
• Employers cannot enter into, enforce or threaten to enforce non-compete covenants with low-wage employees
• Low wage employees subject to a covenant have the right to bring civil suits against their employers
• Employers who violate the law are subject to a civil penalty of $10,000 for each violation
• The effective date of 7/1/20. Agreements entered before this date are excluded from the law.

Virginia employers need to stay aware of the Commonwealth’s labor law poster requirements: they must post several posters in addition to the federal labor law posters required for every state.

Required Posters for Virginia Employers:

• Covenant Not To Compete
• Unemployment Compensation Act (UC)*
• Occupational Safety and Health Law (VOSH)*
• Earned Income Tax Credit (EITC)*
• Workers’ Compensation Notice (VWC)*
• Fair Standard Labor Act (FSLA) —every employer with employees subject to FSLA

*Included on Spanish poster

NOTE: Spanish posters may not include all notices published on the English poster and may vary from our standard 18″w x 24″h size since some states do not issue all notices in Spanish.

Earned Income Tax Credit – Feb. 2020
VOSH – Safety & Health – Aug 2019
Earned Income Tax Credit – Feb 2019
VOSH – Safety & Health – Feb 2019
VOSH – Safety & Health – Aug 2018
Virginia Credit for Low-Income Individuals – Mar 2018
Earned Income Tax Credit – Mar 2018
Workers Compensation – Feb 2011
Unemployment – Feb 2011
Safety & Health (VOSH) – Feb 2011
Earned Income Tax Credit – Feb 2011
Virginia Earned Income Tax Credit – Feb 2011

Must also post Federal Labor Law Posters

Employment posters must be posted in a conspicuous location.

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