Virginia Small Business: No Non-Compete for “Low-Wage” Earners

In continuation of Small Business Employment Law Week, the next topic of discussion is the change in stance on non-competes for “low-wage” earners, which now extends beyond just employees.

Virginia has recently joined the growing ranks of states prohibiting employers from requiring lower-wage workers to enter into non-competes. Virginia House Bill 330 and Senate Bill 480, which Governor Northam has signed into law afford these protections, which reflects the  reflecting a public policy concern about the fairness and equity of imposing non-competes, which come with the threat of a lawsuit, on workers far removed from sensitive information that could harm their employer. Low-wage employees who are subject to such noncompetes now have a private right of action agains their employer to pursue damages such as injunctive relief, compensatory damages, and reasonable attorneys’ fees and costs.

A “low-wage employee” is defined in the new law as an employee whose average weekly earnings are less than the Virginia average weekly wage. As such, interns, students, apprentices, and trainees all constitute low-wage employees. This can also include independent contractors if they are compensated at an hourly rate that is less than the median hourly wage in Virginia, as measured by the preceding year and reported by the U.S. Bureau of Labor Statistics.

However, the new law still permits employers to require low-wage employees to enter into non-disclosure or confidentiality agreements that are meant to protect trade secrets and proprietary and confidential information.

If you have questions regarding changes to Virginia Employment Law and how it affects your small business, please don’t hesitate to reach out to Winslow & McCurry at (804) 423-1382 or to schedule a consultation.