Starting on July 1, 2026, important changes are coming to Virginia’s health care professionals and their employment landscape.
Starting July 1, 2026, Virginia law will prohibit employers, including hospitals, physician groups, and other medical providers, from entering into, enforcing, or even threatening to enforce non-competition agreements against health care professionals. If your organization currently uses non-competes, or if you are a health care professional subject to one, don’t overlook this!
Who Is Covered?
The law protects “health care professionals,” a term that encompasses a broad range of licensed and credentialed individuals working in the medical field. This includes physicians, nurses, physician assistants, therapists, and other clinical workers. Employers covered by the statute include any entity that employs health care professionals, from large hospital systems to small private practices.
What the Law Prohibits
After July 1, 2026, no employer may:
Enter into a non-compete agreement with a health care professional; or
Threaten to enforce a non-compete agreement against a health care professional.
The new law does not apply to contracts, covenants or agreements – including non-compete agreements, which were entered into before July 1, 2026. Agreements entered into before that date are still valid and enforceable.
Penalties for Violations
The consequences for non-compliance are serious and fall into two categories: civil liabilities and civil penalties.
Civil Liability: A health care professional may bring a civil lawsuit against a former employer who violates the statute. The court may award lost compensation, other damages, and attorney’s fees and costs. The professional has a two-year window to bring a claim, measured from the latest of: the signing of the covenant, the date the professional learned of the covenant, the date employment was terminated, or the date the employer took steps to enforce the covenant.
Civil Penalties: In addition to civil liability, the employer may be subject to a penalty of up to $10,000 per violation, which is a separate and additional consequence on top of any damages owed to the professional. This penalty is paid to the Commissioner.
Additional Possible Penalties: Employers are also required to post a copy of the relevant statutory section in a conspicuous location. Failure to do so initially results in a warning, followed by fines of up to $250 and then up to $1,000 for continued non-compliance.
Key Exceptions: What Is Still Permitted
The new law does not prohibit all restrictive covenants including those entered into before July 1, 2026. Several important categories remain valid and enforceable by the employer:
Nondisclosure Agreements
Employers may still use nondisclosure agreements that prohibit employees from taking, sharing, or misappropriating confidential information and trade secrets. These agreements remain a lawful tool for protecting proprietary business information.
Non-Competes in Business Sales
Non-compete covenants remain permissible when a health care professional, or their business entity, is party to a transaction involving the sale of a practice’s goodwill. For example, if a physician sells their practice which may include patient relationships, client lists, and goodwill, and then plans to open a competing practice in the same market, a non-compete that is reasonable in scope, duration, and geographic area is enforceable. This is a significant carve-out that recognizes the legitimate need to protect a purchaser’s investment.
Repayment Agreements for Recruitment and Training Costs
Employers may still require health care professionals to repay recruitment, education, or training-related costs such as relocation expenses, continuing education fees, or signing bonuses if the professional departs within a specified period. However, these agreements are only enforceable against professionals who have been employed for fewer than five years. A professional who has worked for an employer for five or more years cannot be held to such repayment obligations.
Non-Solicitation Agreements
Non-solicitation agreements, which restrict the departing medical professional from actively soliciting the employer’s patients or clients they had professional contact with during their employment, remain valid, as long as they are not overly broad. Importantly, these agreements must preserve the professional’s right to inform former patients of their continuing medical practice, their new contact information, and the patient’s right to choose their own health care provider.
Action Steps for Employers and Employees
Whichever side you find yourself on, there’s a short window of time to make the necessary adjustments. Make sure to check these items off your list before July 1.
For Employers:
Review all existing employment agreements that contain non-compete provisions and make any revisions necessary at time of renewal.
Revise template agreements to remove or replace non-compete language for any agreement entered into after July 1, 2026.
Ensure compliant nondisclosure agreements, narrowly tailored non-solicitation clauses, and valid repayment provisions are in place to protect your organization’s legitimate interests.
Post the required statutory notice in your workplace.
For Health Care Professionals:
Review any non-compete covenants in your current or past employment agreements. If entered into prior to July 1, 2026, the restrictive covenants are still enforceable.
Keep in mind that any non-compete agreement entered into after July 1, 2026, will generally be unenforceable, and you have the right to bring a civil action if an employer attempts to enforce one.
Be aware that repayment agreements and non-solicitation clauses may still apply if you leave your place of employment.
We Can Help
This law represents a meaningful shift in Virginia health care employment law, and the window to prepare is short. Whether you are an employer seeking to restructure your agreements or a professional who just wants to understand your rights, DLG’s employment and business attorneys are here to help. Contact us today to schedule a consultation.
Virginia’s New Non-Compete Ban for Health Care Workers: What Employers and Professionals Need to Know
Starting on July 1, 2026, important changes are coming to Virginia’s health care professionals and their employment landscape.
Starting July 1, 2026, Virginia law will prohibit employers, including hospitals, physician groups, and other medical providers, from entering into, enforcing, or even threatening to enforce non-competition agreements against health care professionals. If your organization currently uses non-competes, or if you are a health care professional subject to one, don’t overlook this!
Who Is Covered?
The law protects “health care professionals,” a term that encompasses a broad range of licensed and credentialed individuals working in the medical field. This includes physicians, nurses, physician assistants, therapists, and other clinical workers. Employers covered by the statute include any entity that employs health care professionals, from large hospital systems to small private practices.
What the Law Prohibits
After July 1, 2026, no employer may:
The new law does not apply to contracts, covenants or agreements – including non-compete agreements, which were entered into before July 1, 2026. Agreements entered into before that date are still valid and enforceable.
Penalties for Violations
The consequences for non-compliance are serious and fall into two categories: civil liabilities and civil penalties.
Civil Liability: A health care professional may bring a civil lawsuit against a former employer who violates the statute. The court may award lost compensation, other damages, and attorney’s fees and costs. The professional has a two-year window to bring a claim, measured from the latest of: the signing of the covenant, the date the professional learned of the covenant, the date employment was terminated, or the date the employer took steps to enforce the covenant.
Civil Penalties: In addition to civil liability, the employer may be subject to a penalty of up to $10,000 per violation, which is a separate and additional consequence on top of any damages owed to the professional. This penalty is paid to the Commissioner.
Additional Possible Penalties: Employers are also required to post a copy of the relevant statutory section in a conspicuous location. Failure to do so initially results in a warning, followed by fines of up to $250 and then up to $1,000 for continued non-compliance.
Key Exceptions: What Is Still Permitted
The new law does not prohibit all restrictive covenants including those entered into before July 1, 2026. Several important categories remain valid and enforceable by the employer:
Nondisclosure Agreements
Employers may still use nondisclosure agreements that prohibit employees from taking, sharing, or misappropriating confidential information and trade secrets. These agreements remain a lawful tool for protecting proprietary business information.
Non-Competes in Business Sales
Non-compete covenants remain permissible when a health care professional, or their business entity, is party to a transaction involving the sale of a practice’s goodwill. For example, if a physician sells their practice which may include patient relationships, client lists, and goodwill, and then plans to open a competing practice in the same market, a non-compete that is reasonable in scope, duration, and geographic area is enforceable. This is a significant carve-out that recognizes the legitimate need to protect a purchaser’s investment.
Repayment Agreements for Recruitment and Training Costs
Employers may still require health care professionals to repay recruitment, education, or training-related costs such as relocation expenses, continuing education fees, or signing bonuses if the professional departs within a specified period. However, these agreements are only enforceable against professionals who have been employed for fewer than five years. A professional who has worked for an employer for five or more years cannot be held to such repayment obligations.
Non-Solicitation Agreements
Non-solicitation agreements, which restrict the departing medical professional from actively soliciting the employer’s patients or clients they had professional contact with during their employment, remain valid, as long as they are not overly broad. Importantly, these agreements must preserve the professional’s right to inform former patients of their continuing medical practice, their new contact information, and the patient’s right to choose their own health care provider.
Action Steps for Employers and Employees
Whichever side you find yourself on, there’s a short window of time to make the necessary adjustments. Make sure to check these items off your list before July 1.
For Employers:
For Health Care Professionals:
We Can Help
This law represents a meaningful shift in Virginia health care employment law, and the window to prepare is short. Whether you are an employer seeking to restructure your agreements or a professional who just wants to understand your rights, DLG’s employment and business attorneys are here to help. Contact us today to schedule a consultation.
Our Practice Areas Include:
Blog Categories
Recent Blog Posts
Virginia’s New Non-Compete Ban for Health Care Workers: What Employers and Professionals Need to Know
June 4, 2026Commercial Real Estate Closings: What’s a Letter of Intent and Why Do I Need One?
May 13, 2026