Updates to Employment Agreements in Maryland and Virginia
As employers in Maryland and Virginia are increasingly aware, laws affecting noncompete, confidentiality, nondisclosure, and nondisparagement provisions in employment agreements have been changing rapidly in recent years. In this post, we will cover the latest developments in both states, providing HR professionals with an overview of what to look out for when crafting or updating employment agreements.
Noncompete Agreements in Maryland and Virginia
Noncompete agreements, also known as restrictive covenants, are contracts between employers and employees in which the employee agrees not to compete with the employer for a certain period of time or in a certain geographic area after the termination of employment. Both Maryland and Virginia have adopted laws that restrict the use of noncompete agreements.
In Maryland, noncompete agreements are limited to one year in duration and must be “reasonable” in geographic scope and be “narrowly tailored” to protect the employer’s legitimate business interests. They must also be in writing, be signed by both parties, and be provided to the employee in exchange for additional consideration.
In Virginia, noncompete agreements are generally enforceable, provided they are reasonable in their terms and conditions. However, Virginia courts consider a variety of factors when determining whether a covenant is reasonable, including the duration of the agreement, the geographic scope of the agreement, the nature of the industry, and the employee’s role within the company.
Confidentiality Agreements in Maryland and Virginia
Confidentiality agreements are used to protect trade secrets, confidential business information, and other forms of sensitive data. In Maryland, these agreements must be in writing, signed by both parties, and provided to the employee in exchange for additional consideration. Additionally, the agreement must be “reasonably necessary” to protect the employer’s legitimate business interests.
In Virginia, the law governing confidentiality agreements is less restrictive. Generally, these agreements are enforceable if they are “reasonable” and are necessary to protect the employer’s legitimate business interests. Additionally, Virginia courts have held that non-disclosure agreements may be enforced without additional consideration.
Nondisclosure and Nondisparagement Agreements in Maryland and Virginia
Nondisclosure and nondisparagement agreements are also commonly used in Maryland and Virginia. In Maryland, these agreements are generally enforceable, provided they are reasonable in their terms and conditions. Additionally, the agreement must be in writing, signed by both parties, and provided to the employee in exchange for additional consideration.
In Virginia, the law governing these agreements is similar to that in Maryland. Generally, these agreements are enforceable if they are reasonable in their terms and conditions and are necessary to protect the employer’s legitimate business interests. However, Virginia courts have held that non-disparagement agreements may be enforced without additional consideration.
Conclusion
In conclusion, employers in Maryland and Virginia should be aware of the latest developments in the law governing noncompete, confidentiality, nondisclosure, and nondisparagement agreements. These agreements can be valuable tools for protecting an employer’s legitimate business interests, provided they are reasonable and are provided in exchange for additional consideration. As always, employers should consult with a qualified attorney to ensure their agreements are compliant with the law.
