(If I could insert a song into this post it would be the 1969 chorus – Na na na na, na na na na, hey hey hey, goodbye)
Or, I would insert a clip from the Wizard of Oz at the end where Dorothy lifts the broom overhead and the little people sing “ding dong the witch is dead!”
I have long hated non competes. I hate them for the way they thwart the local economy, prevent women from leaving jobs they hate, stifle competition. I have seen awesome people leave our City because they would rather move than fight a non-compete in Court. In sum, they stink – and more democratic states are beginning to agree.
This year – 2026, the Virginia General Assembly is beginning to chip away at non-compete agreements and they have outlawed Non-Compete Agreements for Doctors and other healthcare providers in Virginia starting this July 1, 2026. PRAISE THE LORD! Ding dong the witch is dead!
This week I wrote an opinion letter for a client, a Physician who was looking to make an employment change, but has an overbearing non-compete agreement under Virginia law. In the opinion letter, I wrote the following:
As you and I discussed, Virginia judges have long applied common law test to every non-compete to determine it’s enforceability under the law. Restraints against competition are disfavored in Virginia but may be enforceable when the agreement is narrowly drawn to protect the employer’s legitimate business interest, is not unduly burdensome on the employee’s ability to earn a living, and is not against public policy. Omniplex World Servs. Corp. v. US Investigations Servs., 270 Va. 246, 249 (2005). In evaluating these factors, courts consider the function, geographic scope, and duration of the restriction. Virginia courts follow the “red pencil rule” — if a court finds a restrictive covenant to be overbroad on its face, the court cannot modify or strike language to make it enforceable. The entire covenant falls. If the noncompete is vague or ambiguous, susceptible to a meaning that would render the agreement overbroad, the clause will be declared invalid. Virginia judges will not re-write or “blue pencil” your contract to make it valid or enforceable.
I believe a new law that goes into effect July 1, 2026 will greatly limit a hospital or medical practices’ ability to enforce any restrictive covenant as necessary and reasonable. Va. Code § 40.1-28.7:8 has been amended to ban employers from entering into non-compete agreements with “health care professionals,” defined as any person licensed, registered, or certified by the Board of Medicine, Nursing, Counseling, Optometry, Psychology, or Social Work. If violated, employers could face a civil penalty of $10,000 for each violation. After July 1, 2026, non-competes with healthcare professionals are essentially banned outright (with the narrow business-sale carveout) in Virginia. For agreements already in place involving healthcare employees, I think it likely judges will find there is no longer a legitimate business interest to enforcing contracts against healthcare providers. Why? Because how could a contract provision that was signed in May 2026 be binding, and “protect a reasonable business interest” when the same exact contract is not binding, and does not protect a reasonable business interest if signed July 1, 2026.? In sum, I believe it unlikely hospitals will seek to legally enforce previously signed contracts as more and more new employees cannot sign them. And, it is harder to prove you have a legitimate business interest in preventing one employee’s competition, but not another.
IN SUM: I think this new law will essentially paralyze hospitals and medical practices from enforcing previously signed non-competes under the law against their employees.
THIS IS GREAT NEWS: I have long hated non compete agreements, especially for healthcare providers. Doctors don’t have trade secrets, confidential information etc. — they should be allowed to stay and treat patients in a community where they have established roots.
I am grateful to see this finally come to fruition in the Commonwealth of Virginia.
If you are a new doctor – and are asked to sign one, great! Your employer could get fined up to $10,000!
If you are an established doctor and your contract comes up for renewal, your new agreement cannot include a non-compete.
If you signed one years ago and want to leave, it is much less likely you will get sued now. Is it a guarantee? Nope – but I’d be willing to bet you won’t see hospitals paying many lawyers to enforce them in the near future.