Virginia Bans Most Noncompetes for Healthcare and Discharged Staff in 2026

Virginia will ban most noncompete agreements for healthcare professionals and without-cause terminations starting July 1, 2026.

Virginia's Governor Abigail Spanberger signed Senate Bill 170 on April 13, 2026, tightening restrictions on noncompete agreements. Effective July 1, 2026, employers cannot enforce noncompetes against employees terminated without cause, unless the contract specifies severance or other monetary consideration.

This new law does not define what qualifies as 'cause' or set a minimum severance amount. Employers are responsible for updating contracts to address these points, as unclear terms could lead to interpretation disputes in court and administrative actions.

A major expansion comes from House Bill 627 (enacted April 22, 2026). It bans new noncompete agreements for most licensed, registered, or certified healthcare professionals signed on or after July 1, 2026, with few exceptions.

• Employees who challenge prohibited noncompetes can seek monetary damages, lost wages, liquidated damages, and attorneys’ fees.
• The Virginia law imposes civil penalties up to $10,000 per violation for employers who apply banned noncompetes, including those covering "low-wage" workers or affected health professionals.
• Businesses must display a copy or approved summary of the new law with other mandatory workplace notices.

Employment attorneys at McGuireWoods advise immediate review of employment agreements and compliance practices. The law's vague definitions of "cause" and required severance could create compliance risks if not addressed in updated contracts.

Official legislative details are available via the Virginia General Assembly website.

Yes, but: Key terms like 'cause' and severance remain undefined, leaving open questions for employers revising agreements.

What's next: Employers have until July 1, 2026, to update policies and posting materials, or risk penalties and employee claims.