In brief
• New state laws affect noncompete agreements for employees
• Increased wage transparency requirements for businesses
• Stronger worker protections and compliance mandates
• Employers must update policies to meet new legal standards
For many, the start of summer means warmer temperatures, the end of the school year and the promise of outdoor activities and vacations to come as the seasons change. In Virginia, the start of summer means another thing is on the horizon: the effective date of much of the legislation passed in the winter by the General Assembly.
While the passage of Senate Bill 1218, which further narrows the ability of employers to enforce noncompete agreements in Virginia, took many of the headlines, other legislation coming into effect July 1 could impact attorneys in the business and employment law spaces.
“I think the biggest one for me is the personal injury and wrongful death liability law,” Williamsburg attorney Brian Muse said. “This bill would create liability for employers based on workplace injuries if that person is a ‘vulnerable victim.’”
The legislation, Senate Bill 894, adds Va. Code § 8.01-42.6 to allow a jury to find an employer liable for the acts of an employee if the employer knew the employee could be in contact with a “vulnerable victim,” a term defined in the statute as “any person who is at a substantial disadvantage relative to an employee due to circumstances, including such person’s physical or mental condition or characteristics.”
The new code section goes on to define “vulnerable victim” to include patients at health care providers, a “person under a disability” as outlined by law, a resident of an assistant living facility, passengers of a common carrier or nonemergency medical transporter and a business invitee of an esthetics spa.
The legislation applies in cases of personal injury or wrongful death for causes of action accruing on or after July 1.
SB 894
SB 894, patroned by Sen. Russet Perry, D-Leesburg, first hit the legislative microscope in its review before the Senate Courts of Justice Committee on Jan. 20.
“This bill was brought about because the common law on these type of torts… was that in cases like this a person could sue that person’s employer, with the idea being that the employer is in the best place to be able to know who they’ve hired, who they are giving the person they’ve hired access to…and whether or not that’s someone that they should employ, retain and trust with some of these vulnerable people,” Perry told the committee.
Perry said the bill “is more of a restatement” of the common law and puts the commonwealth’s code in line with other states. Sen. Mark Obenshain, R-Harrisonburg, co-patroned SB 894.
“This is not groundbreaking,” Obenshain told the committee. “This does not change the trajectory of the Earth’s rotation.” Obenshain added that the bill looks “at who is in the best position to prevent this kind of harm,” and it allows a jury to determine if the conduct is within the scope of employment.
Obenshain further noted that the bill “is generally the law nationwide.”
“This is not novel, this is designed to protect innocent victims,” Obenshain stated.
SB 894 was supported by the Virginia Trial Lawyers Association. Richmond trial attorney Craig Curwood told the committee of a case he was a part of where he represented a hospital patient who was sexually assaulted by a nurse.
“A jury never got a chance to rule on the hospital’s vicarious liability for the wrong committed by its nurse,” Curwood said. “Virginia’s constitution calls for the right to jury trial to be held sacred — this bill will preserve the fundamental right and bring the law back in line with the intent of the framers.”
Groups who spoke in opposition to the legislation included the Virginia Association of Defense Attorneys. Patrick O’Grady from the VADA said the bill “is pure vicarious liability.”
“An employer can do all the right things, be exonerated by a jury, and still be asked to foot the bill for the acts of a wayward employee,” O’Grady told the committee.
The Courts of Justice Committee ultimately advanced the legislation on a 13-1 vote, with SB 894 passing both chambers of the General Assembly with bipartisan majorities. Gov. Glenn Youngkin returned the bill to the Legislature with an amendment proposal to narrow the definition of “vulnerable victim,” as well as rephrased subsection A of the code section. The General Assembly rejected Youngkin’s amendment.
Agreements
Also effective July 1 are Virginia’s new, narrower use of noncompete agreements following the passage of SB 1218. The bill’s passage continued a general trend towards limiting the use of noncompetes, non-disparagement and confidentiality agreements, which has been seen in Virginia in recent years via legislation.
In 2023, the Legislature passed House Bill 1895, which prohibited employers from requiring prospective or current employees to agree to confidentiality or non-disclosure agreements that restrict disclosure of sexual assault.
Two years on, Muse said he has not seen a major impact on the settlement of claims in litigation stemming from HB 1895.
“Importantly, this law only covers agreements that are entered into ‘as a condition of employment,’” Muse said. “The statute does not cover severance agreements and litigation settlement agreements because such agreements are not entered into as a ‘condition of employment.’”
Muse said other, more broad actions on the topic have seen a greater impact than targeted restrictions.
“At least until recently, the broad restrictions on non-disparagement and confidentiality provisions in employment-related agreements put in place by the National Labor Relations Board have likely overshadowed more targeted legal restrictions such as this one,” Muse said.
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