open-agreements 0.7.6 → 0.7.7

package/skills/non-compete-contract-explainer/content/virginia.md

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+---
+jurisdiction: "Virginia"
+slug: virginia
+countryCode: US
+snapshotAsOf: "2026-06-08"
+lastReviewed: "2026-06-02"
+canonicalUrl: https://openagreements.org/legal/non-compete/virginia
+license: CC BY 4.0
+stale: false
+---
+
+> [!IMPORTANT]
+> **Informational only — not legal advice.** This is a snapshot of an OpenAgreements practice note,
+> provided for general information. It is not legal advice, does not create an attorney-client
+> relationship, and is not a substitute for a licensed attorney in the relevant jurisdiction.
+> Laws change; verify against the canonical version before relying on it.
+>
+> **Canonical:** https://openagreements.org/legal/non-compete/virginia · **Snapshot as of:** 2026-06-08 · License: CC BY 4.0 · © UseJunior
+
+# Non-Competes in Virginia[^about]
+
+Virginia non-compete law combines Va. Code § 40.1-28.7:8, a common-law reasonableness test, no blue-pencil rule, low-wage and FLSA-non-exempt bans, July 1, 2026 changes, and trade-secret alternatives.
+
+
+## At a glance
+
+| Question | Virginia |
+| --- | --- |
+| **Are non-competes enforceable?** | Allowed above a pay level |
+| **Bottom line** | Virginia bans non-competes outright for statutory low-wage and FLSA non-exempt employees, while higher-paid workers remain subject to a strict common-law reasonableness test with no judicial blue-penciling. |
+| **Main law or case** | Va. Code § 40.1-28.7:8; common law (Omniplex World Servs. Corp. v. U.S. Investigations Servs., 270 Va. 246 (2005)) |
+| **Main exceptions** | Low-wage/FLSA-non-exempt ban (commission/incentive-earner exclusion); health-care-professional ban and severance-or-disclosed-comp rule eff. July 1, 2026; NDAs/trade-secret preserved |
+| **When the ban took effect** | Low-wage ban eff. July 1, 2020 (FLSA-non-exempt July 1, 2025; 2026 threshold under $1,507.01/week); health-care ban July 1, 2026 |
+| **Can a court narrow it?** | No |
+| **Applies to contractors?** | Yes |
+| **Restriction extended during a breach?** | Not resolved — strict construction makes an extension clause an overbreadth risk |
+| **Maximum length set by law** | No statutory limit |
+| **Must the employer pay to enforce?** | Yes — severance or disclosed pay if fired without cause |
+
+## Are employee non-compete agreements enforceable in Virginia? {#employee-noncompetes}
+
+**Short answer.** Sometimes. Virginia remains a reasonableness state for workers outside the statutory ban, but Va. Code § 40.1-28.7:8 flatly prohibits employers from entering into, enforcing, or threatening to enforce non-competes with covered *low-wage employees* [^statutory-ban-baseline].
+
+The result is a dual track. For covered workers, the statute controls first. For everyone else, the common-law test controls, and the employer must prove a restraint is narrowly drawn, not unduly burdensome on earning a living, and consistent with public policy [^omniplex-basic-test].
+
+The statutory track is broad after the 2025 amendment. The Virginia Department of Workforce Development and Advancement calculates the 2026 wage threshold at less than $1,507.01 per week, and the protected class also includes FLSA non-exempt employees regardless of earnings [^doli-current-threshold].
+
+> [!NOTE]
+> **Practice note.**
+>
+> Do not treat Virginia as either a total-ban state or a simple reasonableness state. The first question is whether § 40.1-28.7:8 bars the covenant for the worker; only then does common-law reasonableness matter [^statutory-ban-baseline][^omniplex-basic-test].
+
+## What makes a Virginia non-compete reasonable or enforceable? {#reasonableness-test}
+
+**Short answer.** A Virginia employee non-compete must satisfy a three-part reasonableness test and must be evaluated through function, geography, and duration together [^omniplex-three-part-test][^preferred-elements-together].
+
+The employer bears the burden. Virginia courts ask whether the restraint protects a legitimate business interest, whether it is unduly harsh in limiting the employee's livelihood, and whether it fits sound public policy [^omniplex-three-part-test]. They then examine the function, geographic scope, and duration as an integrated whole rather than isolated drafting boxes [^preferred-elements-together].
+
+Function is often the trap. In *Home Paramount*, the Supreme Court of Virginia rejected a clause that barred pest-control work in any capacity because it was not confined to the employee's actual work or the employer's proved interest [^home-paramount-any-capacity]. In *Motion Control*, the court similarly rejected a restraint reaching a wide range of businesses unrelated to the employer's specialized business [^motion-control-similar-business].
+
+"the clear overbreadth of the function here cannot be saved by narrow tailoring of geographic scope and duration."[^home-paramount-overbreadth]
+
+Each case remains fact-specific. *Modern Environments* states that restrictive covenants are strictly construed, and the employer must produce the justification for the actual restraint it chose [^modern-environments-burden].
+
+## Which Virginia employees cannot be bound by non-competes under the statutory ban? {#protected-workers}
+
+**Short answer.** Virginia employers cannot use non-competes with statutory *low-wage employees*, a group that now includes workers below the 2026 weekly wage threshold and FLSA non-exempt employees regardless of pay [^statute-low-wage-threshold][^statute-low-wage-flsa][^doli-threshold][^doli-flsa].
+
+For 2026, the wage threshold is less than $1,507.01 per week, or about $78,364.52 per year. The statute also covers interns, students, apprentices, trainees, and certain lower-paid independent contractors, while excluding employees whose earnings are derived in whole or predominant part from sales commissions, incentives, or bonuses [^doli-threshold][^statute-interns-trainees][^statute-independent-contractors][^statute-commission-exclusion].
+
+The remedies have teeth. A covered worker may sue within the statutory limitations period; a court may void the covenant, enjoin conduct, award lost compensation, damages, liquidated damages, and attorney fees; DOLI may assess a $10,000 civil penalty for each violation; and employers must post the required notice [^statute-private-action-relief][^statute-fees][^statute-civil-penalty][^statute-posting].
+
+> [!NOTE]
+> **Practice note.**
+>
+> The FLSA-non-exempt expansion is independent of the dollar threshold. A highly paid non-exempt employee can still be protected by § 40.1-28.7:8 because the statute covers workers entitled to overtime regardless of average weekly earnings [^statute-low-wage-flsa][^doli-flsa].
+
+## Will a Virginia court narrow or blue-pencil an overbroad non-compete? {#court-narrowing}
+
+**Short answer.** No, not in the practical sense employers usually mean. Virginia courts strictly construe restrictive covenants, and a clear overbreadth problem can make the covenant unenforceable rather than narrowed by the court [^motion-control-strict-construction][^home-paramount-no-extrinsic-narrowing].
+
+The strict approach matters because overbreadth in one element can sink the whole restraint. *Home Paramount* refused to save an overbroad function restriction with narrower geography and duration, and rejected the employer's attempt to narrow clear text through extrinsic evidence [^home-paramount-overbreadth-no-save][^home-paramount-no-extrinsic-narrowing].
+
+That does not mean every enforceability question can be decided from the pleadings. In *Assurance Data*, the Supreme Court of Virginia warned that restraints are neither enforceable nor unenforceable in a factual vacuum; the court needs evidence before deciding whether the actual restraint is reasonable as a whole [^assurance-data-factual-vacuum].
+
+> [!CAUTION]
+> **Drafting note.**
+>
+> Do not rely on a savings clause to rescue broad language. Virginia's cases put the burden on the employer to defend the language it chose, and clear overbreadth cannot be cured by asking the court to read the covenant as if it were narrower [^home-paramount-no-extrinsic-narrowing][^motion-control-strict-construction].
+
+## Does the restricted period toll or extend during breach or litigation in Virginia? {#tolling-extension}
+
+**Short answer.** Virginia law does not squarely answer this in the staged authorities. No source in this corpus resolves whether a non-compete period tolls during breach or litigation, or whether an extension-on-breach clause is enforceable; the available cases only supply strict-construction and overbreadth background [^tolling-motion-control-strict][^tolling-home-paramount-overbreadth].
+
+The risk-weighted answer is cautious. Virginia courts strictly construe non-competes as restraints of trade, and clear overbreadth can void a restraint rather than invite judicial narrowing [^tolling-motion-control-strict][^tolling-home-paramount-overbreadth]. That backdrop makes a clause that lengthens the restricted period a plausible overbreadth risk, especially if it creates an open-ended or litigation-driven restraint.
+
+> [!NOTE]
+> **Practice note.**
+>
+> Treat extension-on-breach drafting as unsettled Virginia law, not as an automatic equitable remedy. The available Virginia authorities support strict construction and no rescue for clear overbreadth, but they do not decide tolling or extension-on-breach clauses specifically [^tolling-motion-control-strict][^tolling-home-paramount-overbreadth].
+
+## How do non-solicitation provisions fit in Virginia, especially for protected workers? {#non-solicitation}
+
+**Short answer.** Customer non-solicits can fit differently from non-competes, but the line is narrow. Va. Code § 40.1-28.7:8 says a covenant not to compete cannot block a former employee from serving a customer if the employee did not initiate contact or solicit the customer [^statute-customer-service-carveout].
+
+In unpublished *Sentry Force Security, LLC v. Barrera*, the Court of Appeals of Virginia read that sentence to permit a restriction against direct customer solicitation, even assuming the worker was low wage [^sentry-customer-solicitation]. The same opinion drew the opposite conclusion for customer-initiated business: if the customer approaches the former employee, the statute protects accepting that work [^sentry-passive-customer].
+
+The opinion also treated employee solicitation differently from customer solicitation for protected workers. It held that § 40.1-28.7:8 prevented enforcement of a covenant barring the former worker from soliciting Sentry Force's other employees [^sentry-employee-solicitation].
+
+> [!NOTE]
+> **Practice note.**
+>
+> Use *Sentry Force* carefully. It is an unpublished Court of Appeals memorandum opinion, so it is useful Virginia-specific guidance but has limited precedential weight; draft customer provisions to target employee-initiated solicitation, not passive acceptance of customer-initiated work [^sentry-customer-solicitation][^sentry-passive-customer].
+
+## What is changing in Virginia non-compete law on July 1, 2026? {#july-2026-changes}
+
+**Short answer.** Two enacted changes take effect July 1, 2026: a severance-or-prior-disclosed-compensation rule for employees discharged without cause, and a health-care-professional non-compete ban [^gt-sb170-severance][^troutman-sb128-effective-healthcare].
+
+For SB 170, commentary reports that Governor Abigail Spanberger signed the bill on April 13, 2026. For agreements entered, amended, or renewed on or after July 1, 2026, the new rule makes a non-compete unenforceable if the employer terminates the employee without cause and the employee does not receive severance pay or other prior disclosed monetary compensation [^gt-sb170-severance].
+
+The SB 128 / HB 627 health-care change categorically bans non-competes for almost all health care professionals. Troutman Pepper Locke supports the July 1, 2026 effective-date status and the categorical health-care-professional ban; Ogletree remains useful for the covered-board scope, including professionals licensed, registered, or certified by the Boards of Medicine, Nursing, Counseling, Optometry, Psychology, or Social Work [^troutman-sb128-effective-healthcare][^ogletree-sb128-healthcare].
+
+> [!NOTE]
+> **Practice note.**
+>
+> The SB 170 change is prospective. Commentary says contracts, covenants, or agreements entered into, amended, or renewed before July 1, 2026, are not affected by SB 170 [^gt-sb170-prospective].
+
+## What can Virginia employers use instead of a non-compete? {#alternatives}
+
+**Short answer.** Virginia employers can still use properly tailored nondisclosure, confidentiality, and trade-secret protections. Section 40.1-28.7:8 expressly preserves nondisclosure agreements aimed at misappropriation and sharing of trade secrets, proprietary information, and confidential information [^statute-nda-preserved].
+
+That alternative has its own limits. The Virginia Uniform Trade Secrets Act defines a trade secret as information with independent economic value from not being generally known and subject to reasonable secrecy efforts [^vutsa-trade-secret-definition]. It also permits injunctions for actual or threatened misappropriation, but those injunctions are tied to the trade-secret problem rather than a general ban on competition [^vutsa-injunctive-relief].
+
+> [!CAUTION]
+> **Drafting note.**
+>
+> Keep confidentiality and trade-secret covenants separate from a work ban. A clause labeled as confidentiality can still create non-compete risk if it restrains ordinary competition rather than protecting specific confidential, proprietary, or trade-secret information [^statute-nda-preserved][^vutsa-trade-secret-definition].
+
+[^about]: By Steven Obiajulu, J.D. Published by [openagreements.org](https://openagreements.org) · Maintained by [UseJunior](https://usejunior.com). Last reviewed 2026-06-02. License: CC BY 4.0. Steven Obiajulu, J.D. is admitted in New York, not Virginia. This article synthesizes Virginia primary law and is not legal advice from a Virginia-admitted attorney. This article is for informational purposes only and does not create an attorney-client relationship.
+
+[^statutory-ban-baseline]: **Va. Code § 40.1-28.7:8** — "No employer shall enter into, enforce, or threaten to enforce a covenant not to compete with any low-wage employee." *Va. Code Ann. § 40.1-28.7:8(B).* <https://law.lis.virginia.gov/vacode/40.1-28.7:8/>
+
+[^omniplex-basic-test]: **Omniplex World Services Corp. v. U.S. Investigations Services, Inc.** — "These considerations form the basis of the three-part test we use to determine the validity of restrictive covenants: (1) Is the restraint, from the standpoint of the employer, reasonable in the sense that it is no greater than necessary to protect the employer in some legitimate business interest? (2) From the standpoint of the employee, is the restraint reasonable in the sense that it is not unduly harsh and oppressive in curtailing his legitimate efforts to earn a livelihood? (3) Is the restraint reasonable from the standpoint of a sound public policy?" *Omniplex World Servs. Corp. v. U.S. Investigations Servs., Inc., 270 Va. 246, 618 S.E.2d 340 (2005).* <https://www.courtlistener.com/opinion/1058921/omniplex-world-services-v-us-inv/#:~:text=These%20considerations%20form%20the%20basis,of%20a%20sound%20public%20policy%3F>
+
+[^doli-current-threshold]: **Virginia DOLI Notice of the Average Weekly Wage for 2026** — "Effective July 1, 2025, a ‘low-wage employee’ also includes an employee who, regardless of average weekly earnings, is entitled to overtime compensation under the provisions of the Fair Labor Standards Act for any hours worked in excess of 40 hours in any one workweek." *Virginia Department of Workforce Development and Advancement, Notice of the Average Weekly Wage for 2026 (Jan. 6, 2026).* <https://doli.virginia.gov/2026/01/06/notice-of-the-average-weekly-wage-for-2026/>
+
+[^omniplex-three-part-test]: **Omniplex World Services Corp. v. U.S. Investigations Services, Inc.** — "These considerations form the basis of the three-part test we use to determine the validity of restrictive covenants: (1) Is the restraint, from the standpoint of the employer, reasonable in the sense that it is no greater than necessary to protect the employer in some legitimate business interest? (2) From the standpoint of the employee, is the restraint reasonable in the sense that it is not unduly harsh and oppressive in curtailing his legitimate efforts to earn a livelihood? (3) Is the restraint reasonable from the standpoint of a sound public policy?" *Omniplex World Servs. Corp. v. U.S. Investigations Servs., Inc., 270 Va. 246, 618 S.E.2d 340 (2005).* <https://www.courtlistener.com/opinion/1058921/omniplex-world-services-v-us-inv/#:~:text=These%20considerations%20form%20the%20basis,of%20a%20sound%20public%20policy%3F>
+
+[^preferred-elements-together]: **Preferred Systems Solutions, Inc. v. GP Consulting, LLC** — "We assess these elements together rather than as distinct inquiries." *Preferred Sys. Sols., Inc. v. GP Consulting, LLC, 284 Va. 382 (2012).* <https://www.courtlistener.com/opinion/1057833/preferred-systems-solutions-v-gp-consulting/#:~:text=We%20assess%20these%20elements%20together,rather%20than%20as%20distinct%20inquiries.>
+
+[^home-paramount-any-capacity]: **Home Paramount Pest Control Cos. v. Shaffer** — "Because Home Paramount did not confine the function element of the Provision to those activities it actually engaged in, it bore the burden of proving a legitimate business interest in prohibiting Shaffer from engaging in all reasonably conceivable activities while employed by a competitor." *Home Paramount Pest Control Cos. v. Shaffer, 282 Va. 412, 718 S.E.2d 762 (2011).* <https://www.courtlistener.com/opinion/1057978/home-paramount-pest-control-v-shaffer/#:~:text=Because%20Home%20Paramount%20did%20not,while%20employed%20by%20a%20competitor.>
+
+[^motion-control-similar-business]: **Motion Control Systems, Inc. v. East** — "Accordingly, we conclude that the trial court did not err in holding that the covenant not to compete in this case imposed restraints that exceeded those necessary to protect the legitimate business interests of MCS and, therefore, was unenforceable." *Motion Control Sys., Inc. v. East, 262 Va. 33, 546 S.E.2d 424 (2001).* <https://www.courtlistener.com/opinion/1059467/motion-control-systems-inc-v-east/#:~:text=Accordingly%2C%20we%20conclude%20that%20the,MCS%20and%2C%20therefore%2C%20was%20unenforceable.>
+
+[^home-paramount-overbreadth]: **Home Paramount Pest Control Cos. v. Shaffer** — "the clear overbreadth of the function here cannot be saved by narrow tailoring of geographic scope and duration." *Home Paramount Pest Control Cos. v. Shaffer, 282 Va. 412, 718 S.E.2d 762 (2011).* <https://www.courtlistener.com/opinion/1057978/home-paramount-pest-control-v-shaffer/#:~:text=the%20clear%20overbreadth%20of%20the,of%20geographic%20scope%20and%20duration.>
+
+[^modern-environments-burden]: **Modern Environments, Inc. v. Stinnett** — "Second, the employer bears the burden to show that the restraint is no greater than necessary to protect a legitimate business interest, is not unduly harsh or oppressive in curtailing an employee's ability to earn a livelihood, and is reasonable in light of sound public policy." *Modern Env'ts, Inc. v. Stinnett, 263 Va. 491, 561 S.E.2d 694 (2002).* <https://www.courtlistener.com/opinion/1059338/modern-environments-inc-v-stinnett/#:~:text=Second%2C%20the%20employer%20bears%20the,light%20of%20sound%20public%20policy.>
+
+[^statute-low-wage-threshold]: **Va. Code § 40.1-28.7:8** — "means an employee (i) whose average weekly earnings, calculated by dividing the employee's earnings during the period of 52 weeks immediately preceding the date of termination of employment by 52, or if an employee worked fewer than 52 weeks, by the number of weeks that the employee was actually paid during the 52-week period, are less than the average weekly wage of the Commonwealth as determined pursuant to subsection B of § 65.2-500" *Va. Code Ann. § 40.1-28.7:8(A).* <https://law.lis.virginia.gov/vacode/40.1-28.7:8/>
+
+[^statute-low-wage-flsa]: **Va. Code § 40.1-28.7:8** — "who, regardless of his average weekly earnings, is entitled to overtime compensation under the provisions of 29 U.S.C. § 207 for any hours worked in excess of 40 hours in any one workweek." *Va. Code Ann. § 40.1-28.7:8(A).* <https://law.lis.virginia.gov/vacode/40.1-28.7:8/>
+
+[^doli-threshold]: **Virginia DOLI Notice of the Average Weekly Wage for 2026** — "Pursuant to Va. Code § 40.1-28.7:8, the term ‘low-wage employee’ as applied to covenants not to compete has been calculated by the Virginia Department of Workforce Development and Advancement to include all employees who earn an average of less than $1,507.01 per week." *Virginia Department of Workforce Development and Advancement, Notice of the Average Weekly Wage for 2026 (Jan. 6, 2026).* <https://doli.virginia.gov/2026/01/06/notice-of-the-average-weekly-wage-for-2026/>
+
+[^doli-flsa]: **Virginia DOLI Notice of the Average Weekly Wage for 2026** — "Effective July 1, 2025, a ‘low-wage employee’ also includes an employee who, regardless of average weekly earnings, is entitled to overtime compensation under the provisions of the Fair Labor Standards Act for any hours worked in excess of 40 hours in any one workweek." *Virginia Department of Workforce Development and Advancement, Notice of the Average Weekly Wage for 2026 (Jan. 6, 2026).* <https://doli.virginia.gov/2026/01/06/notice-of-the-average-weekly-wage-for-2026/>
+
+[^statute-interns-trainees]: **Va. Code § 40.1-28.7:8** — "includes interns, students, apprentices, or trainees employed, with or without pay, at a trade or occupation in order to gain work or educational experience." *Va. Code Ann. § 40.1-28.7:8(A).* <https://law.lis.virginia.gov/vacode/40.1-28.7:8/>
+
+[^statute-independent-contractors]: **Va. Code § 40.1-28.7:8** — "also includes an individual who has independently contracted with another person to perform services independent of an employment relationship and who is compensated for such services by such person at an hourly rate that is less than the median hourly wage for the Commonwealth for all occupations as reported, for the preceding year, by the Bureau of Labor Statistics of the U.S. Department of Labor." *Va. Code Ann. § 40.1-28.7:8(A).* <https://law.lis.virginia.gov/vacode/40.1-28.7:8/>
+
+[^statute-commission-exclusion]: **Va. Code § 40.1-28.7:8** — "shall not include any employee whose earnings are derived, in whole or in predominant part, from sales commissions, incentives, or bonuses paid to the employee by the employer." *Va. Code Ann. § 40.1-28.7:8(A).* <https://law.lis.virginia.gov/vacode/40.1-28.7:8/>
+
+[^statute-private-action-relief]: **Va. Code § 40.1-28.7:8** — "A low-wage employee may bring a civil action in a court of competent jurisdiction against any former employer or other person that attempts to enforce a covenant not to compete against such employee in violation of this section. An action under this section shall be brought within two years of the latter of (i) the date the covenant not to compete was signed, (ii) the date the low-wage employee learns of the covenant not to compete, (iii) the date the employment relationship is terminated, or (iv) the date the employer takes any step to enforce the covenant not to compete. The court shall have jurisdiction to void any covenant not to compete with a low-wage employee and to order all appropriate relief, including enjoining the conduct of any person or employer, ordering payment of liquidated damages, and awarding lost compensation, damages, and reasonable attorney fees and costs." *Va. Code Ann. § 40.1-28.7:8(D).* <https://law.lis.virginia.gov/vacode/40.1-28.7:8/>
+
+[^statute-fees]: **Va. Code § 40.1-28.7:8** — "If the court finds a violation of the provisions of this section, the plaintiff shall be entitled to recover reasonable costs, including costs and reasonable fees for expert witnesses, and attorney fees from the former employer or other person who attempts to enforce an unlawful covenant not to compete against such plaintiff." *Va. Code Ann. § 40.1-28.7:8(F).* <https://law.lis.virginia.gov/vacode/40.1-28.7:8/>
+
+[^statute-civil-penalty]: **Va. Code § 40.1-28.7:8** — "Any employer that violates the provisions of subsection B as determined by the Commissioner shall be subject to a civil penalty of $10,000 for each violation." *Va. Code Ann. § 40.1-28.7:8(E).* <https://law.lis.virginia.gov/vacode/40.1-28.7:8/>
+
+[^statute-posting]: **Va. Code § 40.1-28.7:8** — "Every employer shall post a copy of this section or a summary approved by the Department in the same location where other employee notices required by state or federal law are posted." *Va. Code Ann. § 40.1-28.7:8(G).* <https://law.lis.virginia.gov/vacode/40.1-28.7:8/>
+
+[^motion-control-strict-construction]: **Motion Control Systems, Inc. v. East** — "As a restraint of trade, the covenant must be strictly construed and, if ambiguous, it must be construed in favor of the employee." *Motion Control Sys., Inc. v. East, 262 Va. 33, 546 S.E.2d 424 (2001).* <https://www.courtlistener.com/opinion/1059467/motion-control-systems-inc-v-east/#:~:text=As%20a%20restraint%20of%20trade%2C,in%20favor%20of%20the%20employee.>
+
+[^home-paramount-no-extrinsic-narrowing]: **Home Paramount Pest Control Cos. v. Shaffer** — "Home Paramount thus was limited to adducing evidence to prove that the language it chose furthered its legitimate business interests, did not unduly burden Shaffer’s ability to earn a living, and was not contrary to public policy." *Home Paramount Pest Control Cos. v. Shaffer, 282 Va. 412, 718 S.E.2d 762 (2011).* <https://www.courtlistener.com/opinion/1057978/home-paramount-pest-control-v-shaffer/#:~:text=Home%20Paramount%20thus%20was%20limited,not%20contrary%20to%20public%20policy.>
+
+[^home-paramount-overbreadth-no-save]: **Home Paramount Pest Control Cos. v. Shaffer** — "the clear overbreadth of the function here cannot be saved by narrow tailoring of geographic scope and duration." *Home Paramount Pest Control Cos. v. Shaffer, 282 Va. 412, 718 S.E.2d 762 (2011).* <https://www.courtlistener.com/opinion/1057978/home-paramount-pest-control-v-shaffer/#:~:text=the%20clear%20overbreadth%20of%20the,of%20geographic%20scope%20and%20duration.>
+
+[^assurance-data-factual-vacuum]: **Assurance Data, Inc. v. Malyevac** — "The premise running through Simmons, Modern Environments, Home Paramount, and our other decisions is that restraints on competition are neither enforceable nor unenforceable in a factual vacuum." *Assurance Data, Inc. v. Malyevac, 286 Va. 137 (2013).* <https://www.courtlistener.com/opinion/1057728/assurance-data-inc-v-malyevac/#:~:text=The%20premise%20running%20through%20Simmons%2C,unenforceable%20in%20a%20factual%20vacuum.>
+
+[^tolling-motion-control-strict]: **Motion Control Systems, Inc. v. East** — "As a restraint of trade, the covenant must be strictly construed and, if ambiguous, it must be construed in favor of the employee." *Motion Control Sys., Inc. v. East, 262 Va. 33, 546 S.E.2d 424 (2001).* <https://www.courtlistener.com/opinion/1059467/motion-control-systems-inc-v-east/#:~:text=As%20a%20restraint%20of%20trade%2C,in%20favor%20of%20the%20employee.>
+
+[^tolling-home-paramount-overbreadth]: **Home Paramount Pest Control Cos. v. Shaffer** — "the clear overbreadth of the function here cannot be saved by narrow tailoring of geographic scope and duration." *Home Paramount Pest Control Cos. v. Shaffer, 282 Va. 412, 718 S.E.2d 762 (2011).* <https://www.courtlistener.com/opinion/1057978/home-paramount-pest-control-v-shaffer/#:~:text=the%20clear%20overbreadth%20of%20the,of%20geographic%20scope%20and%20duration.>
+
+[^statute-customer-service-carveout]: **Va. Code § 40.1-28.7:8** — "shall not restrict an employee from providing a service to a customer or client of the employer if the employee does not initiate contact with or solicit the customer or client." *Va. Code Ann. § 40.1-28.7:8(A).* <https://law.lis.virginia.gov/vacode/40.1-28.7:8/>
+
+[^sentry-customer-solicitation]: **Sentry Force Security, LLC v. Barrera** — "Thus, even assuming Barrera is a low-wage employee for the purposes of this interlocutory appeal (as the parties do), Barrera cannot solicit his former employer’s customers for his own company." *Sentry Force Sec., LLC v. Barrera, Record No. 1405-24-4, slip op. at 14 (Va. Ct. App. Jan. 27, 2026) (unpublished).* <https://www.vacourts.gov/opinions/opncavwp/1405244.pdf>
+
+[^sentry-passive-customer]: **Sentry Force Security, LLC v. Barrera** — "In short, if the customer approaches the former employee with its business, the former employee is not restricted from accepting that customer’s business—and doing work for that customer of the former employer." *Sentry Force Sec., LLC v. Barrera, Record No. 1405-24-4, slip op. at 15 (Va. Ct. App. Jan. 27, 2026) (unpublished).* <https://www.vacourts.gov/opinions/opncavwp/1405244.pdf>
+
+[^sentry-employee-solicitation]: **Sentry Force Security, LLC v. Barrera** — "However, we affirm the circuit court’s decision on Sentry Force’s second assignment of error because Code § 40.1-28.7:8 does prevent Sentry Force from enforcing a ‘covenant not to compete’ agreement against Barrera that stops Barrera (after he left Sentry Force) from soliciting Sentry Force’s other employees." *Sentry Force Sec., LLC v. Barrera, Record No. 1405-24-4, slip op. at 20 (Va. Ct. App. Jan. 27, 2026) (unpublished).* <https://www.vacourts.gov/opinions/opncavwp/1405244.pdf>
+
+[^gt-sb170-severance]: **Greenberg Traurig, Virginia Governor Signs Senate Bill 170, Targeting Noncompete Agreements** — "Under the bill, a noncompete agreement will be unenforceable if an employer terminates an employee without cause and the employee does not receive severance pay or other prior disclosed monetary compensation." *Greenberg Traurig, Virginia Governor Signs Senate Bill 170, Targeting Noncompete Agreements (Apr. 2026).* <https://www.gtlaw.com/en/insights/2026/4/virginia-governor-signs-senate-bill-170-targeting-noncompete-agreements>
+
+[^troutman-sb128-effective-healthcare]: **Virginia Enacts New Restrictions on the Use of Noncompetes** — "These obligations and several other new restrictions are part of Senate Bill 170 and House Bill 627 , landmark legislation recently passed by the General Assembly and slated to take effect on July 1, 2026. The new noncompete legislation applies to all employees and categorically bans noncompetes for almost all health care professionals, in sharp contrast to Virginia’s existing noncompete statutes, which currently cover only low-wage employees, including hourly employees." *Troutman Pepper Locke, Virginia Enacts New Restrictions on the Use of Noncompetes (2026).* <https://www.troutman.com/insights/virginia-enacts-new-restrictions-on-the-use-of-noncompetes/>
+
+[^ogletree-sb128-healthcare]: **Ogletree Deakins, Virginia Further Limits Noncompete Agreements** — "Meanwhile, the Virginia General Assembly also passed SB 128 , which would ban noncompete covenants for healthcare professionals , including any person licensed, registered, or certified by the Board of Medicine, Nursing, Counseling, Optometry, Psychology, or Social Work." *Ogletree Deakins, Virginia Further Limits Noncompete Agreements (2026).* <https://ogletree.com/insights-resources/blog-posts/virginia-further-limits-noncompete-agreements/>
+
+[^gt-sb170-prospective]: **Greenberg Traurig, Virginia Governor Signs Senate Bill 170, Targeting Noncompete Agreements** — "Contracts, covenants, or agreements entered into, amended, or renewed before July 1, 2026, are not affected by SB 170." *Greenberg Traurig, Virginia Governor Signs Senate Bill 170, Targeting Noncompete Agreements (Apr. 2026).* <https://www.gtlaw.com/en/insights/2026/4/virginia-governor-signs-senate-bill-170-targeting-noncompete-agreements>
+
+[^statute-nda-preserved]: **Va. Code § 40.1-28.7:8** — "Nothing in this section shall serve to limit the creation or application of nondisclosure agreements intended to prohibit the taking, misappropriating, threatening to misappropriate, or sharing of certain information to which an employee has access, including trade secrets, as defined in § 59.1-336, and proprietary or confidential information." *Va. Code Ann. § 40.1-28.7:8(C).* <https://law.lis.virginia.gov/vacode/40.1-28.7:8/>
+
+[^vutsa-trade-secret-definition]: **Va. Code § 59.1-336** — "Derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use, and 2. Is the subject of efforts that are reasonable under the circumstances to maintain its secrecy." *Va. Code Ann. § 59.1-336.* <https://law.lis.virginia.gov/vacode/59.1-336/>
+
+[^vutsa-injunctive-relief]: **Va. Code § 59.1-337** — "Actual or threatened misappropriation may be enjoined." *Va. Code Ann. § 59.1-337(A).* <https://law.lis.virginia.gov/vacode/59.1-337/>

package/skills/non-compete-contract-explainer/content/washington.md

@@ -0,0 +1,296 @@
+---
+jurisdiction: "Washington"
+slug: washington
+countryCode: US
+snapshotAsOf: "2026-06-08"
+lastReviewed: "2026-06-03"
+canonicalUrl: https://openagreements.org/legal/non-compete/washington
+license: CC BY 4.0
+stale: false
+---
+
+> [!IMPORTANT]
+> **Informational only — not legal advice.** This is a snapshot of an OpenAgreements practice note,
+> provided for general information. It is not legal advice, does not create an attorney-client
+> relationship, and is not a substitute for a licensed attorney in the relevant jurisdiction.
+> Laws change; verify against the canonical version before relying on it.
+>
+> **Canonical:** https://openagreements.org/legal/non-compete/washington · **Snapshot as of:** 2026-06-08 · License: CC BY 4.0 · © UseJunior
+
+# Non-Competes in Washington[^about]
+
+Washington enforces employee non-competes today only above high, inflation-adjusted earnings thresholds and under strict notice and consideration rules — and a near-total statutory ban takes effect June 30, 2027 under Engrossed Substitute House Bill 1155.
+
+
+## At a glance
+
+| Question | Washington |
+| --- | --- |
+| **Are non-competes enforceable?** | Allowed above a pay level |
+| **Bottom line** | Employee non-competes are void unless earnings exceed an inflation-adjusted threshold ($126,858.83 in 2026); a near-total ban takes effect June 30, 2027. |
+| **Main law or case** | RCW ch. 49.62 (ESHB 1155 ban from 2027) |
+| **Main exceptions** | Confidentiality, trade-secret, qualifying sale-of-business and franchise covenants; narrow non-solicits |
+| **When the ban took effect** | Near-total ban effective June 30, 2027 (ESHB 1155) |
+| **Can a court narrow it?** | Yes — rewrites to reasonable |
+| **Applies to contractors?** | Yes |
+| **Restriction extended during a breach?** | Not addressed by statute |
+| **Maximum length set by law** | 18 months (longer presumed unreasonable) |
+| **Must the employer pay to enforce?** | Yes — if laid off |
+
+## Are employee non-compete agreements enforceable in Washington? {#enforceability}
+
+**Short answer.** Today, only narrowly — and not for long. Washington's Noncompetition Covenants Act, chapter 49.62 RCW, makes an employee non-compete void unless the employer clears every statutory condition, including an earnings threshold that exceeds $126,858.83 for 2026 [^rcw-020-void-conditions][^lni-thresholds-enforceability]. A near-total ban on all non-competition covenants then takes effect on June 30, 2027 [^eshb1155-intent-enforceability][^eshb1155-effective-date-enforceability].
+
+The governing statute is RCW 49.62.020. It does not balance reasonableness the way the common law does; it lists conditions, and a covenant that misses any one of them is void and unenforceable as a matter of law. The conditions include a timely written disclosure, independent consideration for any post-hire covenant, an earnings threshold, and layoff compensation, with a separate eighteen-month outer limit on duration [^rcw-020-all-conditions].
+
+Two dates frame everything below. Covenants entered into now are governed by chapter 49.62 RCW as amended by Substitute Senate Bill 5935, effective June 6, 2024 [^ssb5935-amendments]. On June 30, 2027, Engrossed Substitute House Bill 1155 replaces that conditional regime with a near-total ban that voids non-competes regardless of income and adds an employer notice duty [^eshb1155-intent-enforceability][^eshb1155-effective-date-enforceability].
+
+"Unless the employee's earnings from the party seeking enforcement, when annualized, exceed one hundred thousand dollars per year."[^rcw-020-void-conditions]
+
+## When does a Washington employee earn enough to be bound by a non-compete? {#earnings-threshold}
+
+**Short answer.** Only when annualized earnings exceed the inflation-adjusted threshold, which is $126,858.83 for 2026. The statutory floor is $100,000, but RCW 49.62.040 requires the Department of Labor & Industries to raise it each year for inflation [^rcw-020-threshold][^rcw-040-adjustment][^lni-thresholds-earnings-threshold].
+
+Earnings are measured from the party seeking enforcement and annualized as of the earlier of the date enforcement is sought or the date of separation [^rcw-010-earnings]. Because the figure is reset annually, the controlling number is the one in effect when the covenant is tested, not the $100,000 base written into the statute [^rcw-040-adjustment][^lni-thresholds-earnings-threshold].
+
+> [!NOTE]
+> **Practice note.**
+>
+> The threshold is a floor, not a safe harbor. Clearing $126,858.83 only removes one of several independent grounds for voiding a covenant — the disclosure, consideration, layoff-pay, and duration rules below still apply, and after June 30, 2027 the threshold disappears entirely under the new ban [^rcw-020-threshold][^eshb1155-effective-date-earnings-threshold].
+
+## Can a Washington independent contractor be bound by a non-compete? {#independent-contractors}
+
+**Short answer.** Only at a much higher earnings level — over $317,147.09 for 2026, against a $250,000 statutory base — and a performer's non-compete is capped at three calendar days [^rcw-030-ic-threshold][^rcw-030-performer][^lni-thresholds-independent-contractors].
+
+RCW 49.62.030 sets a separate, higher threshold for independent contractors, adjusted annually under RCW 49.62.040 just like the employee figure [^rcw-030-ic-threshold][^lni-thresholds-independent-contractors]. It also includes an unusual rule for live entertainment: a covenant between a performer and a performance space cannot exceed three calendar days [^rcw-030-performer].
+
+Both of these rules are temporary. ESHB 1155 repeals RCW 49.62.030 outright effective June 30, 2027, after which an independent contractor's non-compete is void regardless of earnings — the same near-total ban that applies to employees [^eshb1155-repeals-ic].
+
+## What must a Washington employer do to make a non-compete valid at signing? {#disclosure-and-consideration}
+
+**Short answer.** Disclose the covenant in writing by the time the worker accepts the offer, and give independent consideration for any covenant signed after employment starts. Continued employment alone is not enough [^rcw-020-disclosure][^rcw-020-consideration][^labriola-independent-consideration].
+
+RCW 49.62.020 voids a non-compete unless the employer discloses its terms in writing no later than the time of the worker's initial oral or written acceptance of the offer of employment; a covenant produced later, in an onboarding packet, comes too late [^rcw-020-disclosure]. For a covenant entered into after employment begins, the employer must provide independent consideration [^rcw-020-consideration].
+
+That independent-consideration requirement codifies *Labriola v. Pollard Group, Inc.*, where the Washington Supreme Court held that a non-compete signed after hire is validly formed only with independent consideration and that simply keeping an existing at-will employee on the payroll does not count [^labriola-independent-consideration][^labriola-continued-employment].
+
+"A noncompete agreement entered into after employment has commenced is validly formed only when there is independent consideration at the time the agreement is reached."[^labriola-independent-consideration]
+
+## Can a laid-off Washington employee be held to a non-compete? {#layoff-pay}
+
+**Short answer.** Only if the employer pays for it. A covenant against a worker terminated by layoff is void unless the employer pays compensation equal to the worker's base salary for the enforcement period, offset by what the worker earns elsewhere [^rcw-020-layoff].
+
+This is Washington's garden-leave rule. An employer that lays a worker off cannot also enforce the non-compete for free; it must keep paying base salary during the restricted period, minus any compensation the former employee earns through subsequent employment [^rcw-020-layoff].
+
+## How long can a Washington non-compete last? {#duration}
+
+**Short answer.** Eighteen months is the practical ceiling. A court or arbitrator must presume that any non-compete longer than eighteen months after termination is unreasonable and unenforceable, and only clear and convincing evidence can rebut that presumption [^rcw-020-duration-duration].
+
+The presumption shifts the burden onto the employer: to enforce a covenant longer than eighteen months, the party seeking enforcement must prove by clear and convincing evidence that the longer term is necessary to protect its business or goodwill [^rcw-020-duration-duration].
+
+"A court or arbitrator must presume that any noncompetition covenant with a duration exceeding eighteen months after termination of employment is unreasonable and unenforceable."[^rcw-020-duration-duration]
+
+## What agreements count as non-competes under Washington law? {#what-counts}
+
+**Short answer.** A non-competition covenant is any agreement that restrains a worker from a lawful trade, and — since 2024 — any agreement that directly or indirectly prohibits accepting or transacting business with a customer. Confidentiality agreements, trade-secret covenants, qualifying sale-of-business covenants, and franchise-sale covenants are carved out [^rcw-010-definition][^rcw-010-acceptance-of-business-what-counts][^rcw-010-exclusions].
+
+The label on the document does not control. RCW 49.62.010 defines a non-competition covenant to include every written or oral covenant restraining a worker from a lawful profession, trade, or business [^rcw-010-definition]. Substitute Senate Bill 5935 then expanded the definition in 2024 to capture agreements that directly or indirectly prohibit the acceptance or transaction of business with a customer — so a no-business-with-customer clause is now a non-compete, subject to all the same conditions [^rcw-010-acceptance-of-business-what-counts].
+
+The statute carves out several covenants that are not non-competes: a nonsolicitation agreement, a confidentiality agreement, a covenant protecting trade secrets or inventions, a sale-of-business covenant where the signer holds at least one percent of the business, and a qualifying franchise covenant [^rcw-010-exclusions].
+
+> [!CAUTION]
+> **Drafting note.**
+>
+> A customer non-acceptance or no-business clause is not a safe substitute for a non-solicit. Because the 2024 amendment treats any agreement that directly or indirectly prohibits accepting or transacting business with a customer as a non-compete, drafting around the threshold by forbidding the customer relationship instead of the solicitation pulls the clause back inside RCW 49.62.020 [^rcw-010-acceptance-of-business-what-counts][^rcw-010-exclusions].
+
+## Are non-solicitation and franchise no-poach clauses still allowed in Washington? {#nonsolicitation}
+
+**Short answer.** Yes, but narrowly. A nonsolicitation agreement is exempt from the Act only if it is limited to soliciting the employer's employees or its current customers; and a franchisor cannot bar a franchisee from soliciting or hiring another franchisee's or the franchisor's employees [^rcw-010-nonsolicitation][^rcw-060-franchisor].
+
+The statutory definition of a nonsolicitation agreement is narrow: it reaches only solicitation, upon termination, of the employer's employees or of any current customer of the employer [^rcw-010-nonsolicitation]. A clause that goes beyond solicitation — for example, prohibiting the former worker from accepting business a customer brings to them — is treated as a non-compete instead [^rcw-010-acceptance-of-business-nonsolicitation].
+
+Washington also restricts franchise no-poach arrangements directly: a franchisor may not restrain a franchisee from soliciting or hiring employees of another franchisee of the same franchisor or of the franchisor itself [^rcw-060-franchisor].
+
+Non-solicitation agreements survive the 2027 ban, but on narrower terms. Effective June 30, 2027, ESHB 1155 rewrites the definition to require that the employee established or substantially developed a direct relationship with the customer and that the restriction last no longer than eighteen months [^eshb1155-nonsolicit-narrowing].
+
+## Can a Washington employer stop a low-wage employee from taking a second job? {#moonlighting}
+
+**Short answer.** No. An employer may not prohibit an employee earning less than twice the state minimum wage from taking an additional job, and the Washington Supreme Court has held that the duty-of-loyalty exception to that rule must be construed narrowly [^rcw-070-moonlighting][^david-second-jobs][^david-duty-of-loyalty].
+
+RCW 49.62.070 bars an employer from restraining an employee earning less than twice the applicable state minimum hourly wage from supplementing their income with another job, contract work, or self-employment, subject only to narrow safety and scheduling exceptions and the common-law duty of loyalty [^rcw-070-moonlighting].
+
+In *David v. Freedom Vans, LLC* (2025), the court applied that protection to strike down a blanket non-compete and refused to read the duty-of-loyalty exception broadly, warning that an expansive reading would render the chapter's worker protections meaningless [^david-second-jobs][^david-duty-of-loyalty].
+
+"In Washington, employers who pay their employees less than twice the minimum wage cannot prohibit them from working second jobs, subject to a few, limited exceptions."[^david-second-jobs]
+
+## Can an out-of-state choice-of-law or venue clause govern a Washington worker's non-compete? {#choice-of-law}
+
+**Short answer.** No. For a Washington-based worker, a provision requiring out-of-state adjudication, depriving the worker of the Act's protections, or applying another state's law is void and unenforceable [^rcw-050-choiceoflaw].
+
+RCW 49.62.050 forecloses the standard workaround of routing a Washington worker's covenant through a more employer-friendly state. A venue clause forcing adjudication elsewhere, a clause stripping the chapter's protections, and a choice-of-law clause applying non-Washington substantive law are each independently void as to a Washington-based worker [^rcw-050-choiceoflaw].
+
+## What are the penalties for an unenforceable Washington non-compete? {#penalties}
+
+**Short answer.** At least $5,000 per worker, plus fees — and the penalty is triggered even if a court only partially enforces or rewrites the covenant. The attorney general may also pursue relief [^rcw-080-penalty][^rcw-080-reformation-penalty-penalties][^rcw-080-ag].
+
+If a court or arbitrator finds a covenant violates the chapter, the violator must pay the aggrieved person the greater of actual damages or a $5,000 statutory penalty, plus reasonable attorneys' fees, expenses, and costs [^rcw-080-penalty]. Critically, the same penalty applies when a court reforms, rewrites, modifies, or only partially enforces the covenant — so an employer cannot rely on judicial blue-penciling to escape liability [^rcw-080-reformation-penalty-penalties].
+
+> [!NOTE]
+> **Practice note.**
+>
+> Presenting an overbroad covenant and hoping a court will trim it is itself the risk. Because the penalty attaches even to a partially enforced or reformed covenant, the safer course is to draft within the statutory conditions from the outset rather than rely on a savings clause [^rcw-080-reformation-penalty-penalties][^rcw-080-penalty].
+
+## Are covenants outside the Act judged by a reasonableness test in Washington? {#common-law-reasonableness}
+
+**Short answer.** Yes. Chapter 49.62 RCW preserves the common law, and for a covenant the statute does not void, Washington courts apply a three-factor reasonableness test [^rcw-090-common-law][^perry-three-factors].
+
+The Act expressly does not revoke or impede the development of the common law [^rcw-090-common-law]. So a covenant that clears the statutory conditions — or one the statute does not reach — is still tested for reasonableness. Under *Perry v. Moran*, that test weighs three factors: whether the restraint is necessary to protect the employer's business or goodwill, whether it imposes a greater restraint than reasonably necessary, and the degree of injury to the public [^perry-three-factors]. *Emerick v. Cardiac Study Center, Inc.* confirms the modern formulation that a covenant is enforceable if reasonable [^emerick-enforceable-if-reasonable].
+
+"Whether a covenant is reasonable involves a consideration of three factors: (1) whether restraint is necessary for the protection of the business or goodwill of the employer, (2) whether it imposes upon the employee any greater restraint than is reasonably necessary to secure the employer's business or goodwill, and (3) whether the degree of injury to the public is such loss of the service and skill of the employee as to warrant nonenforcement of the covenant."[^perry-three-factors]
+
+> [!NOTE]
+> **Practice note.**
+>
+> This reasonableness analysis governs only until the 2027 ban. Once ESHB 1155 takes effect on June 30, 2027, a covered non-competition covenant is void regardless of how reasonable it is, so the common-law test will matter mainly for covenants the ban does not reach — such as true non-solicits and qualifying sale-of-business covenants [^eshb1155-ban-common-law][^rcw-090-common-law].
+
+## Will a Washington court rewrite or partially enforce an overbroad non-compete? {#court-narrowing}
+
+**Short answer.** A court can reform an overbroad covenant, but doing so triggers the statutory penalty. Washington courts have long enforced a covenant only to the extent it is reasonable, yet RCW 49.62.080 makes the employer pay the $5,000 penalty whenever a court reforms or partially enforces one [^woodmay-reasonable-extent-court-narrowing][^emerick-partial][^rcw-080-reformation-penalty-court-narrowing].
+
+Washington follows the reasonable-extent rule from *Wood v. May*: a court of equity enforces a restraint against a former employee only to the extent it is reasonable and necessary to protect a legitimate business interest [^woodmay-reasonable-extent-court-narrowing]. *Emerick* applies that to modern covenants, holding that when some terms are unreasonable the entire covenant does not fail — the court may modify it [^emerick-partial].
+
+But under the current statute, reformation is not free. RCW 49.62.080 imposes the $5,000 penalty (or greater actual damages) plus fees whenever a court reforms, rewrites, modifies, or only partially enforces a covenant [^rcw-080-reformation-penalty-court-narrowing].
+
+> [!CAUTION]
+> **Drafting note.**
+>
+> Do not rely on a Washington court to save an overbroad covenant. Even though courts can reform, the act of reforming or partially enforcing triggers the statutory penalty against the employer, so scope, duration, and geography should be drafted to the minimum the legitimate interest requires [^rcw-080-reformation-penalty-court-narrowing][^woodmay-reasonable-extent-court-narrowing].
+
+## Does a Washington non-compete toll or extend during breach or litigation? {#tolling}
+
+**Short answer.** This is an open question, and the statute's structure cuts against automatic extension. Chapter 49.62 RCW does not address tolling or extending the restricted period during a breach or while litigation is pending, and the eighteen-month presumption caps duration regardless [^rcw-020-duration-tolling][^woodmay-reasonable-extent-tolling].
+
+Chapter 49.62 RCW does not address tolling or extension-on-breach clauses, and no controlling Washington decision squarely resolves whether such a clause is enforceable. Two features of Washington law point toward caution. First, RCW 49.62.020 presumes any covenant longer than eighteen months unreasonable, so a tolling clause that pushes enforcement past that window invites the presumption [^rcw-020-duration-tolling]. Second, *Wood v. May* limits a court to enforcing a restraint only to its reasonable extent, which sits uneasily with a clause that mechanically lengthens the restriction [^woodmay-reasonable-extent-tolling].
+
+> [!NOTE]
+> **Practice note.**
+>
+> Open question: Washington law is unsettled on whether a clause extending a non-compete during a period of breach or litigation is enforceable. Do not assume a court will toll or extend an expired Washington covenant, especially where the extension would carry the total restriction past eighteen months [^rcw-020-duration-tolling][^woodmay-reasonable-extent-tolling].
+
+## What changes when Washington's near-total non-compete ban takes effect on June 30, 2027? {#the-2027-ban}
+
+**Short answer.** Almost everything. Engrossed Substitute House Bill 1155 makes all non-competition covenants void regardless of income, turns enforcing or even threatening to enforce one into a violation, requires employers to notify affected workers by October 1, 2027, and repeals the income thresholds [^eshb1155-intent-the-2027-ban][^eshb1155-enforcement-violation][^eshb1155-notice-duty][^eshb1155-repeals].
+
+Signed on March 23, 2026 and effective June 30, 2027, ESHB 1155 (chapter 149, Laws of 2026) converts Washington from a conditional-enforceability state into a near-total ban [^eshb1155-intent-the-2027-ban][^eshb1155-effective-date-the-2027-ban]. Several changes matter for employers planning ahead:
+
+- 
+- 
+- 
+- 
+
+> [!NOTE]
+> **Practice note.**
+>
+> Start planning now, not in 2027. The ban applies regardless of when a covenant was signed and adds an October 1, 2027 notice obligation, so employers should inventory existing Washington covenants and prepare worker notices well before the effective date. Re-verify the enrolled text before acting, because implementing guidance may follow [^eshb1155-voidall][^eshb1155-notice-duty].
+
+[^about]: By Steven Obiajulu, J.D. Published by [openagreements.org](https://openagreements.org) · Maintained by [UseJunior](https://usejunior.com). Last reviewed 2026-06-03. License: CC BY 4.0. Steven Obiajulu, J.D. is admitted in New York, not Washington. This article synthesizes Washington primary law and is not legal advice from a Washington-admitted attorney. This article is for informational purposes only and does not create an attorney-client relationship.
+
+[^rcw-020-void-conditions]: **RCW 49.62.020** — "Unless the employee's earnings from the party seeking enforcement, when annualized, exceed one hundred thousand dollars per year." *RCW 49.62.020(1)(b).* <https://app.leg.wa.gov/RCW/default.aspx?cite=49.62.020>
+
+[^lni-thresholds-enforceability]: **Washington State Department of Labor & Industries — Non-Compete Agreements** — "Employees $116,593.18 $120,559.99 $123,394.17 $126,858.83 Independent Contractors $291,482.95 $301,399.98 $308,485.43 $317,147.09" *Wash. Dep't of Labor & Indus., Non-Compete Agreements (earnings thresholds, 2026).* <https://www.lni.wa.gov/workers-rights/workplace-policies/non-compete-agreements>
+
+[^eshb1155-intent-enforceability]: **Engrossed Substitute House Bill 1155, ch. 149, Laws of 2026** — "The legislature hereby intends to ban noncompetition covenants for all Washington-based workers and businesses." *Engrossed Substitute House Bill 1155, ch. 149, Laws of 2026, § 1(3).* <https://lawfilesext.leg.wa.gov/Biennium/2025-26/Htm/Bills/Session%20Laws/House/1155-S.SL.htm>
+
+[^eshb1155-effective-date-enforceability]: **Engrossed Substitute House Bill 1155, ch. 149, Laws of 2026** — "This act takes effect June 30, 2027." *Engrossed Substitute House Bill 1155, ch. 149, Laws of 2026, § 9.* <https://lawfilesext.leg.wa.gov/Biennium/2025-26/Htm/Bills/Session%20Laws/House/1155-S.SL.htm>
+
+[^rcw-020-all-conditions]: **RCW 49.62.020** — "(1) A noncompetition covenant is void and unenforceable: (a)(i) Unless the employer discloses the terms of the covenant in writing to the prospective employee no later than the time of the initial oral or written acceptance of the offer of employment and, if the agreement becomes enforceable only at a later date due to changes in the employee's compensation, the employer specifically discloses that the agreement may be enforceable against the employee in the future; or (ii) If the covenant is entered into after the commencement of employment, unless the employer provides independent consideration for the covenant; (b) Unless the employee's earnings from the party seeking enforcement, when annualized, exceed one hundred thousand dollars per year. This dollar amount must be adjusted annually in accordance with RCW 49.62.040 ; (c) If the employee is terminated as the result of a layoff, unless enforcement of the noncompetition covenant includes compensation equivalent to the employee's base salary at the time of termination for the period of enforcement minus compensation earned through subsequent employment during the period of enforcement." *RCW 49.62.020(1).* <https://app.leg.wa.gov/RCW/default.aspx?cite=49.62.020>
+
+[^ssb5935-amendments]: **Substitute Senate Bill 5935, ch. 36, Laws of 2024** — "AN ACT Relating to noncompetition covenants" *Substitute Senate Bill 5935, ch. 36, Laws of 2024.* <https://lawfilesext.leg.wa.gov/biennium/2023-24/Htm/Bills/Session%20Laws/Senate/5935-S.SL.htm>
+
+[^rcw-020-threshold]: **RCW 49.62.020** — "Unless the employee's earnings from the party seeking enforcement, when annualized, exceed one hundred thousand dollars per year. This dollar amount must be adjusted annually in accordance with RCW 49.62.040" *RCW 49.62.020(1)(b).* <https://app.leg.wa.gov/RCW/default.aspx?cite=49.62.020>
+
+[^rcw-040-adjustment]: **RCW 49.62.040** — "The dollar amounts specified in RCW 49.62.020 and 49.62.030 must be adjusted annually for inflation." *RCW 49.62.040.* <https://app.leg.wa.gov/RCW/default.aspx?cite=49.62.040>
+
+[^lni-thresholds-earnings-threshold]: **Washington State Department of Labor & Industries — Non-Compete Agreements** — "Employees $116,593.18 $120,559.99 $123,394.17 $126,858.83 Independent Contractors $291,482.95 $301,399.98 $308,485.43 $317,147.09" *Wash. Dep't of Labor & Indus., Non-Compete Agreements (earnings thresholds, 2026).* <https://www.lni.wa.gov/workers-rights/workplace-policies/non-compete-agreements>
+
+[^rcw-010-earnings]: **RCW 49.62.010** — "annualized and calculated as of the earlier of the date enforcement of the noncompetition covenant is sought or the date of separation from employment" *RCW 49.62.010(1).* <https://app.leg.wa.gov/RCW/default.aspx?cite=49.62.010>
+
+[^eshb1155-effective-date-earnings-threshold]: **Engrossed Substitute House Bill 1155, ch. 149, Laws of 2026** — "This act takes effect June 30, 2027." *Engrossed Substitute House Bill 1155, ch. 149, Laws of 2026, § 9.* <https://lawfilesext.leg.wa.gov/Biennium/2025-26/Htm/Bills/Session%20Laws/House/1155-S.SL.htm>
+
+[^rcw-030-ic-threshold]: **RCW 49.62.030** — "A noncompetition covenant is void and unenforceable against an independent contractor unless the independent contractor's earnings from the party seeking enforcement exceed two hundred fifty thousand dollars per year." *RCW 49.62.030(1).* <https://app.leg.wa.gov/RCW/default.aspx?cite=49.62.030>
+
+[^rcw-030-performer]: **RCW 49.62.030** — "The duration of a noncompetition covenant between a performer and a performance space, or a third party scheduling the performer for a performance space, must not exceed three calendar days." *RCW 49.62.030(2).* <https://app.leg.wa.gov/RCW/default.aspx?cite=49.62.030>
+
+[^lni-thresholds-independent-contractors]: **Washington State Department of Labor & Industries — Non-Compete Agreements** — "Employees $116,593.18 $120,559.99 $123,394.17 $126,858.83 Independent Contractors $291,482.95 $301,399.98 $308,485.43 $317,147.09" *Wash. Dep't of Labor & Indus., Non-Compete Agreements (earnings thresholds, 2026).* <https://www.lni.wa.gov/workers-rights/workplace-policies/non-compete-agreements>
+
+[^eshb1155-repeals-ic]: **Engrossed Substitute House Bill 1155, ch. 149, Laws of 2026** — "The following acts or parts of acts are each repealed: (1) RCW 49.62.030 (When void and unenforceable against independent contractors)" *Engrossed Substitute House Bill 1155, ch. 149, Laws of 2026, § 8.* <https://lawfilesext.leg.wa.gov/Biennium/2025-26/Htm/Bills/Session%20Laws/House/1155-S.SL.htm>
+
+[^rcw-020-disclosure]: **RCW 49.62.020** — "Unless the employer discloses the terms of the covenant in writing to the prospective employee no later than the time of the initial oral or written acceptance of the offer of employment" *RCW 49.62.020(1)(a)(i).* <https://app.leg.wa.gov/RCW/default.aspx?cite=49.62.020>
+
+[^rcw-020-consideration]: **RCW 49.62.020** — "If the covenant is entered into after the commencement of employment, unless the employer provides independent consideration for the covenant" *RCW 49.62.020(1)(a)(ii).* <https://app.leg.wa.gov/RCW/default.aspx?cite=49.62.020>
+
+[^labriola-independent-consideration]: **Labriola v. Pollard Group, Inc.** — "A noncompete agreement entered into after employment has commenced is validly formed only when there is independent consideration at the time the agreement is reached." *Labriola v. Pollard Group, Inc., 152 Wn.2d 828 (2004).* <https://www.courtlistener.com/opinion/4908367/labriola-v-pollard-group-inc/#:~:text=A%20noncompete%20agreement%20entered%20into,time%20the%20agreement%20is%20reached.>
+
+[^labriola-continued-employment]: **Labriola v. Pollard Group, Inc.** — "We hold that continued employment in this case did not serve as consideration by Employer in exchange for Employee's promise not to compete." *Labriola v. Pollard Group, Inc., 152 Wn.2d 828 (2004).* <https://www.courtlistener.com/opinion/4908367/labriola-v-pollard-group-inc/#:~:text=We%20hold%20that%20continued%20employment,Employee's%20promise%20not%20to%20compete.>
+
+[^rcw-020-layoff]: **RCW 49.62.020** — "If the employee is terminated as the result of a layoff, unless enforcement of the noncompetition covenant includes compensation equivalent to the employee's base salary at the time of termination for the period of enforcement minus compensation earned through subsequent employment during the period of enforcement." *RCW 49.62.020(1)(c).* <https://app.leg.wa.gov/RCW/default.aspx?cite=49.62.020>
+
+[^rcw-020-duration-duration]: **RCW 49.62.020** — "A court or arbitrator must presume that any noncompetition covenant with a duration exceeding eighteen months after termination of employment is unreasonable and unenforceable. A party seeking enforcement may rebut the presumption by proving by clear and convincing evidence that a duration longer than eighteen months is necessary to protect the party's business or goodwill." *RCW 49.62.020(2).* <https://app.leg.wa.gov/RCW/default.aspx?cite=49.62.020>
+
+[^rcw-010-definition]: **RCW 49.62.010** — "‘Noncompetition covenant’ includes every written or oral covenant, agreement, or contract by which an employee or independent contractor is prohibited or restrained from engaging in a lawful profession, trade, or business of any kind." *RCW 49.62.010(4).* <https://app.leg.wa.gov/RCW/default.aspx?cite=49.62.010>
+
+[^rcw-010-acceptance-of-business-what-counts]: **RCW 49.62.010** — "A ‘noncompetition covenant’ also includes an agreement that directly or indirectly prohibits the acceptance or transaction of business with a customer." *RCW 49.62.010(4).* <https://app.leg.wa.gov/RCW/default.aspx?cite=49.62.010>
+
+[^rcw-010-exclusions]: **RCW 49.62.010** — "A ‘noncompetition covenant’ does not include: (a) A nonsolicitation agreement; (b) a confidentiality agreement; (c) a covenant prohibiting use or disclosure of trade secrets or inventions; (d) a covenant entered into by a person purchasing or selling the goodwill of a business or otherwise acquiring or disposing of an ownership interest, but only if the person signing the covenant purchases, sells, acquires, or disposes of an interest representing one percent or more of the business; or (e) a covenant entered into by a franchisee when the franchise sale complies with RCW 19.100.020 (1)." *RCW 49.62.010(4).* <https://app.leg.wa.gov/RCW/default.aspx?cite=49.62.010>
+
+[^rcw-010-nonsolicitation]: **RCW 49.62.010** — "‘Nonsolicitation agreement’ means an agreement between an employer and employee that prohibits solicitation by an employee, upon termination of employment: (a) Of any employee of the employer to leave the employer; or (b) of any current customer of the employer to cease or reduce the extent to which it is doing business with the employer." *RCW 49.62.010(5).* <https://app.leg.wa.gov/RCW/default.aspx?cite=49.62.010>
+
+[^rcw-060-franchisor]: **RCW 49.62.060** — "No franchisor may restrict, restrain, or prohibit in any way a franchisee from soliciting or hiring any employee of a franchisee of the same franchisor. (2) No franchisor may restrict, restrain, or prohibit in any way a franchisee from soliciting or hiring any employee of the franchisor." *RCW 49.62.060(1)-(2).* <https://app.leg.wa.gov/RCW/default.aspx?cite=49.62.060>
+
+[^rcw-010-acceptance-of-business-nonsolicitation]: **RCW 49.62.010** — "A ‘noncompetition covenant’ also includes an agreement that directly or indirectly prohibits the acceptance or transaction of business with a customer." *RCW 49.62.010(4).* <https://app.leg.wa.gov/RCW/default.aspx?cite=49.62.010>
+
+[^eshb1155-nonsolicit-narrowing]: **Engrossed Substitute House Bill 1155, ch. 149, Laws of 2026** — "if the employee established or substantially developed a direct relationship with the customer, patient, client, or prospect through the employee's work for the employer and the prohibition expires no later than 18 months following termination of employment" *Engrossed Substitute House Bill 1155, ch. 149, Laws of 2026, § 3.* <https://lawfilesext.leg.wa.gov/Biennium/2025-26/Htm/Bills/Session%20Laws/House/1155-S.SL.htm>
+
+[^rcw-070-moonlighting]: **RCW 49.62.070** — "an employer may not restrict, restrain, or prohibit an employee earning less than twice the applicable state minimum hourly wage from having an additional job, supplementing their income by working for another employer, working as an independent contractor, or being self-employed." *RCW 49.62.070(1).* <https://app.leg.wa.gov/RCW/default.aspx?cite=49.62.070>
+
+[^david-second-jobs]: **David v. Freedom Vans, LLC** — "In Washington, employers who pay their employees less than twice the minimum wage cannot prohibit them from working second jobs, subject to a few, limited exceptions." *David v. Freedom Vans, LLC, 4 Wn.3d 242 (2025).* <https://www.courtlistener.com/opinion/10319821/springer-v-freedom-vans-llc/#:~:text=In%20Washington%2C%20employers%20who%20pay,to%20a%20few%2C%20limited%20exceptions.>
+
+[^david-duty-of-loyalty]: **David v. Freedom Vans, LLC** — "We decline to adopt this expansive view of the duty of loyalty, as it would render the employee protections in chapter 49.62 RCW meaningless and would require us to ignore the directive in the statute itself that the exceptions be construed narrowly." *David v. Freedom Vans, LLC, 4 Wn.3d 242 (2025).* <https://www.courtlistener.com/opinion/10319821/springer-v-freedom-vans-llc/#:~:text=We%20decline%20to%20adopt%20this,the%20exceptions%20be%20construed%20narrowly.>
+
+[^rcw-050-choiceoflaw]: **RCW 49.62.050** — "A provision in a noncompetition covenant signed by an employee or independent contractor who is Washington-based is void and unenforceable: (1) If the covenant requires the employee or independent contractor to adjudicate a noncompetition covenant outside of this state; (2) To the extent it deprives the employee or independent contractor of the protections or benefits of this chapter; or (3) If it allows or requires the application of choice of law principles or the substantive law of any jurisdiction other than Washington state." *RCW 49.62.050.* <https://app.leg.wa.gov/RCW/default.aspx?cite=49.62.050>
+
+[^rcw-080-penalty]: **RCW 49.62.080** — "If a court or arbitrator determines that a noncompetition covenant violates this chapter, the violator must pay the aggrieved person the greater of his or her actual damages or a statutory penalty of five thousand dollars, plus reasonable attorneys' fees, expenses, and costs incurred in the proceeding." *RCW 49.62.080(2).* <https://app.leg.wa.gov/RCW/default.aspx?cite=49.62.080>
+
+[^rcw-080-reformation-penalty-penalties]: **RCW 49.62.080** — "If a court or arbitrator reforms, rewrites, modifies, or only partially enforces any noncompetition covenant, the party seeking enforcement must pay the aggrieved person the greater of his or her actual damages or a statutory penalty of five thousand dollars, plus reasonable attorneys' fees, expenses, and costs incurred in the proceeding." *RCW 49.62.080(3).* <https://app.leg.wa.gov/RCW/default.aspx?cite=49.62.080>
+
+[^rcw-080-ag]: **RCW 49.62.080** — "Upon a violation of this chapter, the attorney general, on behalf of a person or persons, may pursue any and all relief." *RCW 49.62.080(1).* <https://app.leg.wa.gov/RCW/default.aspx?cite=49.62.080>
+
+[^rcw-090-common-law]: **RCW 49.62.090** — "Except as otherwise provided in this chapter, this chapter does not revoke, modify, or impede the development of the common law." *RCW 49.62.090(2).* <https://app.leg.wa.gov/RCW/default.aspx?cite=49.62.090>
+
+[^perry-three-factors]: **Perry v. Moran** — "Whether a covenant is reasonable involves a consideration of three factors: (1) whether restraint is necessary for the protection of the business or goodwill of the employer, (2) whether it imposes upon the employee any greater restraint than is reasonably necessary to secure the employer's business or goodwill, and (3) whether the degree of injury to the public is such loss of the service and skill of the employee as to warrant nonenforcement of the covenant." *Perry v. Moran, 109 Wn.2d 691 (1987).* <https://www.courtlistener.com/opinion/1453982/perry-v-moran/#:~:text=Whether%20a%20covenant%20is%20reasonable,warrant%20nonenforcement%20of%20the%20covenant.>
+
+[^emerick-enforceable-if-reasonable]: **Emerick v. Cardiac Study Center, Inc.** — "Under Washington law, noncompete covenants are enforceable if they are reasonable and lawful." *Emerick v. Cardiac Study Ctr., Inc., 189 Wn. App. 711 (2015).* <https://www.courtlistener.com/opinion/2830060/robert-emerick-v-cardiac-study-center-incps/#:~:text=Under%20Washington%20law%2C%20noncompete%20covenants,they%20are%20reasonable%20and%20lawful.>
+
+[^eshb1155-ban-common-law]: **Engrossed Substitute House Bill 1155, ch. 149, Laws of 2026** — "The legislature hereby intends to ban noncompetition covenants for all Washington-based workers and businesses." *Engrossed Substitute House Bill 1155, ch. 149, Laws of 2026, § 1(3).* <https://lawfilesext.leg.wa.gov/Biennium/2025-26/Htm/Bills/Session%20Laws/House/1155-S.SL.htm>
+
+[^woodmay-reasonable-extent-court-narrowing]: **Wood v. May** — "It is well settled that a court of equity will use its power to enforce a restriction against a former employee's competition only to the extent that such restriction is reasonable and necessary to protect a legitimate business interest of the employer." *Wood v. May, 73 Wn.2d 307 (1968).* <https://www.courtlistener.com/opinion/1207148/wood-v-may/#:~:text=It%20is%20well%20settled%20that,business%20interest%20of%20the%20employer.>
+
+[^emerick-partial]: **Emerick v. Cardiac Study Center, Inc.** — "If the trial court determines that certain terms of the covenant are unreasonable—such as the geographic and temporal scope of the restraint—the entire covenant does not fail." *Emerick v. Cardiac Study Ctr., Inc., 189 Wn. App. 711 (2015).* <https://www.courtlistener.com/opinion/2830060/robert-emerick-v-cardiac-study-center-incps/#:~:text=If%20the%20trial%20court%20determines,entire%20covenant%20does%20not%20fail.>
+
+[^rcw-080-reformation-penalty-court-narrowing]: **RCW 49.62.080** — "If a court or arbitrator reforms, rewrites, modifies, or only partially enforces any noncompetition covenant, the party seeking enforcement must pay the aggrieved person the greater of his or her actual damages or a statutory penalty of five thousand dollars, plus reasonable attorneys' fees, expenses, and costs incurred in the proceeding." *RCW 49.62.080(3).* <https://app.leg.wa.gov/RCW/default.aspx?cite=49.62.080>
+
+[^rcw-020-duration-tolling]: **RCW 49.62.020** — "A court or arbitrator must presume that any noncompetition covenant with a duration exceeding eighteen months after termination of employment is unreasonable and unenforceable." *RCW 49.62.020(2).* <https://app.leg.wa.gov/RCW/default.aspx?cite=49.62.020>
+
+[^woodmay-reasonable-extent-tolling]: **Wood v. May** — "It is well settled that a court of equity will use its power to enforce a restriction against a former employee's competition only to the extent that such restriction is reasonable and necessary to protect a legitimate business interest of the employer." *Wood v. May, 73 Wn.2d 307 (1968).* <https://www.courtlistener.com/opinion/1207148/wood-v-may/#:~:text=It%20is%20well%20settled%20that,business%20interest%20of%20the%20employer.>
+
+[^eshb1155-intent-the-2027-ban]: **Engrossed Substitute House Bill 1155, ch. 149, Laws of 2026** — "The legislature hereby intends to ban noncompetition covenants for all Washington-based workers and businesses." *Engrossed Substitute House Bill 1155, ch. 149, Laws of 2026, § 1(3).* <https://lawfilesext.leg.wa.gov/Biennium/2025-26/Htm/Bills/Session%20Laws/House/1155-S.SL.htm>
+
+[^eshb1155-enforcement-violation]: **Engrossed Substitute House Bill 1155, ch. 149, Laws of 2026** — "It is a violation of this chapter for an employer to enforce, attempt to enforce, or threaten to enforce against an employee or worker any noncompetition covenant, to represent that the employee or worker is subject to a noncompetition covenant, or to enter into or attempt to enter into a noncompetition covenant with an employee or worker." *Engrossed Substitute House Bill 1155, ch. 149, Laws of 2026, § 4(2).* <https://lawfilesext.leg.wa.gov/Biennium/2025-26/Htm/Bills/Session%20Laws/House/1155-S.SL.htm>
+
+[^eshb1155-notice-duty]: **Engrossed Substitute House Bill 1155, ch. 149, Laws of 2026** — "By October 1, 2027, an employer must make reasonable efforts to provide written notice to all current and former employees and independent contractors whose noncompetition covenant is still within its effective time period, that their noncompetition covenant is void and unenforceable." *Engrossed Substitute House Bill 1155, ch. 149, Laws of 2026, § 4(3).* <https://lawfilesext.leg.wa.gov/Biennium/2025-26/Htm/Bills/Session%20Laws/House/1155-S.SL.htm>
+
+[^eshb1155-repeals]: **Engrossed Substitute House Bill 1155, ch. 149, Laws of 2026** — "The following acts or parts of acts are each repealed: (1) RCW 49.62.030 (When void and unenforceable against independent contractors) and 2019 c 299 s 4; (2) RCW 49.62.040 (Dollar amounts adjusted) and 2019 c 299 s 5" *Engrossed Substitute House Bill 1155, ch. 149, Laws of 2026, § 8.* <https://lawfilesext.leg.wa.gov/Biennium/2025-26/Htm/Bills/Session%20Laws/House/1155-S.SL.htm>
+
+[^eshb1155-effective-date-the-2027-ban]: **Engrossed Substitute House Bill 1155, ch. 149, Laws of 2026** — "This act takes effect June 30, 2027." *Engrossed Substitute House Bill 1155, ch. 149, Laws of 2026, § 9.* <https://lawfilesext.leg.wa.gov/Biennium/2025-26/Htm/Bills/Session%20Laws/House/1155-S.SL.htm>
+
+[^eshb1155-voidall]: **Engrossed Substitute House Bill 1155, ch. 149, Laws of 2026** — "regardless of when the parties entered into the noncompetition covenant." *Engrossed Substitute House Bill 1155, ch. 149, Laws of 2026, § 4(1).* <https://lawfilesext.leg.wa.gov/Biennium/2025-26/Htm/Bills/Session%20Laws/House/1155-S.SL.htm>