No Severance, No Non-Compete? Virginia Expands Its Non-Compete Restrictions
Virginia is poised to further expand its restrictions on employee non-competes. The Virginia legislature r ecently passed SB 170 (the “SB 170”), making employee non-competes unenforceable if an employer terminates an employee without cause and does not provide severance or other monetary compensation . This new requirement applies to non-competes for employees at all levels regardless of compensation. Failure to comply with SB 170 can lead to civil penalties and private rights of action with recovery of attorney fees and damages. SB 170 is headed to Governor Abigail Spanberger, who is expected to sign it. This development is the latest in the growing patchwork of state non-compete laws. Although the Federal Trade Commission’s (“FTC’s”) nationwide non-compete rule has been sidelined , scrutiny of restrictive covenants at the FTC remains. States, such as Colorado , Illinois , and Minnesota , continue to pass laws seeking to limit or ban employ...