Legislative Scoop: Key Employment Law Updates from South Dakota, Virginia, and Washington

Each month, GovDocs’ Employment Law & Compliance Team provides the scoop on key bills making their way through the legislative process. Below are three state bills that could impact employment agreements with employees, at both the start and end of employment. 

South Dakota HB 1180

On March 12, Governor Rhoden of South Dakota signed into law HB 1180 adding a new section to the South Dakota code on unlawful contracts relating to non-compete agreements.  This new law deems it unlawful for a non-compete agreement to be in place after a transfer of ownership, in the same geographical area, for a period of more than 3 years. This is a long-winded way of saying that once you sell a business, a non-compete clause in the final sale agreement for more than 3 years will be voided in South Dakota. This law will go into effect on July 1, 2026.  

Virginia SB 128

The next stop in this legislative roundup is Virginia, where SB 128 passed both the House and Senate as of March 14th, and is waiting for the signature of Governor Spanberger to become law. This bill expands Virginia’s existing non-compete law to include “health care professionals,” prohibiting employers from enforcing non-compete agreements against them when leaving their current positions. The bill defines “health care professionals” as any person who has obtained proper certification or licensure in the medical profession.  

This bill is not focused exclusively on employee rights, as it also explicitly states when nondisclosure agreements and non competes are permitted. Such as a non-disclosure agreement regarding trade secrets that allows an employer to recover relocation expenses paid to prevent an employee from soliciting patients for their own practice. Additionally, there is a provision in this bill that would allow a non-compete to be enforceable for healthcare professionals when a business is sold. The act will not affect any contracts renewed on or before the effective date of this bill, if passed, on July 1, 2026.