Can a Virginia employer require assignment of every invention?
There is no statutory ceiling. Unlike California or New York, Virginia has no employee-invention-assignment statute — nothing that voids an assignment of a true own-time, own-resource invention — so an assignment clause's reach is bounded by ordinary contract law, the common-law inventor-owns default, and the federal patent and copyright overlay. The one Virginia-specific outer limit is restraint-of-trade law — where an assignment clause operates as a post-employment restraint, Va. Code § 40.1-28.7:8 prohibits covenants not to compete outright for a large covered class of employees. On a touch screen, a tap shows all 2 sources in this group.
Because there is no statute on point, the limits come from general principles rather than a legislative carve-out. A full-text sweep of all 76 titles of the Code of Virginia, run against the official bulk data published by the Virginia Law Library, surfaces no private-employee invention provision anywhere: the word invention appears only in a 1977 consumer-protection chapter regulating commercial invention-development services (Va. Code §§ 59.1-208 through 59.1-215), which polices paid invention promoters rather than employers, and in one unrelated tax provision. Title 40.1, Virginia's labor and employment title, contains no invention, patent, or intellectual-property-assignment language at all. There is no California Labor Code § 2870 analogue and no New York Labor Law § 203-f analogue.
The nearest thing Virginia has to an employment-invention statute is public-sector only. Va. Code § 2.2-2822 gives the Commonwealth ownership of inventions developed by state employees on state time or with state resources — a rule that by its terms does not reach private employment .
The substantive default that contract law operates against is the federal patent premise restated in Stanford v. Roche: absent an effective assignment, rights in an invention belong to the person who conceived it .
The practical consequence is that a Virginia employer can, in principle, contract for assignment more broadly than a California or Washington employer, because no statute carves out own-time inventions from the reach of the clause. But that breadth is not unlimited. An assignment clause is still an ordinary contract term subject to contract-law defenses, and where it restrains what a person may do after employment ends, it runs into Virginia's statutory treatment of covenants not to compete — a regime analyzed in the trailing-clause question below .
Sources for this answer
Va. Code § 2.2-2822 makes inventions developed by a state employee on state time, within the scope of employment, or with state facilities the property of the Commonwealth — a public-sector ownership rule that is the closest thing Virginia has to an employment-invention statute and that does not reach private employees.
Patents, copyrights or materials that were potentially patentable or copyrightable developed by a state employee during working hours or within the scope of his employment or when using state-owned or state-controlled facilities shall be the property of the Commonwealth.
See Va. Code § 2.2-2822(A).
Stanford v. Roche confirms the long-standing premise of U.S. patent law that rights in an invention belong to the inventor, the baseline against which any assignment clause is measured.
Since 1790, the patent law has operated on the premise that rights in an invention belong to the inventor.
See Bd. of Trustees of the Leland Stanford Junior Univ. v. Roche Molecular Sys., Inc., 563 U.S. 776 (2011).
Va. Code § 40.1-28.7:8(B) prohibits employers from entering into, enforcing, or threatening to enforce a covenant not to compete with any low-wage employee or health care professional — the general restraint-of-trade bound an aggressive assignment clause would face in Virginia if it operates as a post-employment restraint.
No employer shall enter into, enforce, or threaten to enforce a covenant not to compete with any low-wage employee or health care professional.
See Va. Code § 40.1-28.7:8(B).
Must a Virginia employer notify the employee?
Not applicable. Because Virginia has no invention-assignment statute, there is no statutory carve-out to notify the employee about and no notice requirement of the kind California imposes under Labor Code § 2872 or Washington imposes under RCW 49.44.140(3). The one nearby posting duty — Va. Code § 40.1-28.7:8(G) — is a generic workplace poster about the noncompete statute itself, not an invention-assignment notice, and it does not condition the validity of any assignment clause .
There is nothing to give notice of. A notice requirement exists in California and Washington precisely to alert the employee to a statutory own-time carve-out that limits the assignment; Virginia has enacted no such carve-out, so there is no statutory line for a notice to mark. This is why the entry is marked not applicable rather than a bare no: the question presupposes a statutory carve-out that Virginia does not have.
One nearby statutory duty is worth distinguishing so it is not mistaken for an invention notice. Va. Code § 40.1-28.7:8(G) requires every employer to post a copy of that section — Virginia's covenant-not-to-compete statute — or an approved summary alongside the other workplace notices required by state and federal law, with graduated penalties for noncompliance that run from a written warning to civil penalties of up to $250 and then up to $1,000 for subsequent violations .
That posting duty attaches to every employer regardless of what any contract says. It is not triggered by an invention-assignment clause, it says nothing about inventions, and complying with it neither validates nor cures any assignment provision. For a multistate employer the takeaway is the inverse of the notice states: a Virginia employer neither has to give a § 2872-style invention notice nor can rely on one to cure an overbroad clause — the enforceability of the assignment turns on the contract language and the general limits on restraints.
Sources for this answer
Va. Code § 40.1-28.7:8(G) imposes a generic workplace-posting duty — every employer must post a copy of the covenant-not-to-compete statute or an approved summary with other required employee notices — which is not an invention-assignment notice, is not triggered by any contract clause, and does not condition the validity of an assignment provision.
Every employer shall post a copy of this section or a summary approved by the Department in the same location where other employee notices required by state or federal law are posted.
See Va. Code § 40.1-28.7:8(G).
Who owns an invention by default in Virginia?
The inventor, unless hired to invent. Absent a written assignment, the baseline under federal patent law is that rights in an invention belong to the employee who conceived it; the narrow exception is the employee hired to invent, whose resulting invention the employer may claim. No decision of Virginia's state appellate courts on private employee-invention ownership was found in our review — the operative authorities are the federal baseline and the federal courts sitting in Virginia that apply it. On a touch screen, a tap shows all 2 sources in this group.
Stanford v. Roche anchors the default. The Supreme Court held that even the Bayh-Dole Act did not displace the long-standing rule that an invention belongs to its inventor, treating that premise as the baseline against which any assignment is measured .
Because ownership starts with the inventor, an employer's title is derivative — it exists only if and to the extent the employee assigned it. Any third-party interest must trace back to that inventor-grantor .
The principal exception is the employee hired to invent. Under United States v. Dubilier Condenser Corp., an employee engaged to make a particular invention who succeeds during the term of service must assign the resulting patent to the employer .
The Fourth Circuit — whose decisions bind the federal courts sitting in Virginia — stated the hired-to-invent rule early and in strong form in Houghton v. United States. One caveat on provenance: Houghton came up from the District of Maryland, so it is circuit-level doctrine that Virginia's federal courts apply, not a holding of Virginia law .
The real-world Virginia-forum fight is Avtec Systems, Inc. v. Peiffer, the canonical Virginia-sited dispute over an employee's off-hours creation — satellite-orbit software the employee developed at home, on his own equipment. Avtec is a copyright and trade-secret case rather than a patent case, so its ownership analysis runs through the work-made-for-hire doctrine, and the Fourth Circuit made the employer's claim turn on the Restatement (Second) of Agency § 228 scope-of-employment test .
Short of ownership, an employer whose time, tools, and materials contributed to the invention holds only a shop right. In the Avtec litigation the Eastern District of Virginia stated the doctrine — a nonexclusive right to use, not title — by adopting the Ninth Circuit's definition from California Eastern Laboratories, Inc. v. Gould .
Because ownership therefore starts with the inventor, Virginia has no statute filling the gap, and the scope-of-employment fight in Avtec shows how weak an employer's implied claim is for off-hours, own-equipment work, the dependable path for an employer is a written present-assignment (hereby assigns) clause with a defined scope of covered inventions — one that transfers legal title automatically on conception rather than resting on a future promise, an after-the-fact hired-to-invent argument about what the employee's duties actually were, or a shop right that licenses use but passes no title.
Sources for this answer
Stanford v. Roche confirms the long-standing premise of U.S. patent law that rights in an invention belong to the inventor.
Since 1790, the patent law has operated on the premise that rights in an invention belong to the inventor.
See Bd. of Trustees of the Leland Stanford Junior Univ. v. Roche Molecular Sys., Inc., 563 U.S. 776 (2011).
Stanford v. Roche holds that although others may acquire an interest in an invention, that interest as a general rule must trace back to the inventor — so an employer takes title only through an assignment from the employee-inventor.
Thus, although others may acquire an interest in an invention, any such interest — as a general rule — must trace back to the inventor.
See Bd. of Trustees of the Leland Stanford Junior Univ. v. Roche Molecular Sys., Inc., 563 U.S. 776 (2011).
United States v. Dubilier Condenser Corp. holds that an employee hired to make an invention who succeeds during the term of service is bound to assign the resulting patent to the employer.
One employed to make an invention, who succeeds, during his term of service, in accomplishing that task, is bound to assign to his employer any patent obtained.
See United States v. Dubilier Condenser Corp., 289 U.S. 178 (1933).
Houghton v. United States — a Fourth Circuit decision on appeal from the District of Maryland, so binding circuit doctrine applied by Virginia's federal courts rather than a holding of Virginia law — holds that while an employee is engaged on work directed at making an invention, he is employed to invent, and the results of his efforts at invention belong to the employer.
During the period that he is so engaged, he is “employed to invent,” and the results of his efforts at invention belong to his employer in the same way as would the product of his efforts in any other direction.
See Houghton v. United States, 23 F.2d 386 (4th Cir. 1928).
Avtec Systems, Inc. v. Peiffer — the leading Virginia-forum fight over an employee's off-hours software creation — makes the employer's work-made-for-hire claim turn on the Restatement (Second) of Agency § 228 scope-of-employment test, which the Fourth Circuit quotes as the governing standard.
conduct is within the scope of employment "only if: (a) it is of the kind he is employed to perform; (b) it occurs substantially within the authorized time and space limits; [and] (c) it is actuated, at least in part, by a purpose to serve the master."
See Avtec Sys., Inc. v. Peiffer, 21 F.3d 568 (4th Cir. 1994) (quoting Restatement (Second) of Agency § 228 (1958)).
Avtec Systems, Inc. v. Peiffer (E.D. Va.), quoting the Ninth Circuit's definition in California Eastern Laboratories, Inc. v. Gould, states the shop-right doctrine as applied in a Virginia forum — a nonexclusive right to use an employee's invention developed on the employer's time, based on the employer's presumed contribution of materials, time, and equipment, not ownership of it.
A shop right is an employer’s nonexclusive right to use an employee’s patented process or invention that was developed during the employee’s hours of employment. The right is based on the employer’s presumed contribution to the invention through materials, time, and equipment.
See Avtec Sys., Inc. v. Peiffer, 805 F. Supp. 1312 (E.D. Va. 1992) (quoting Cal. E. Labs., Inc. v. Gould, 896 F.2d 400, 402 (9th Cir. 1990)).
California Eastern Laboratories, Inc. v. Gould defines a shop right as an employer's nonexclusive right to use an employee's invention developed during the employee's hours of employment, based on the employer's presumed contribution of materials, time, and equipment — the definition Avtec quotes.
A shop right is an employer's nonexclusive right to use an employee's patented process or invention that was developed during the employee's hours of employment. The right is based on the employer's presumed contribution to the invention through materials, time, and equipment.
See Cal. E. Labs., Inc. v. Gould, 896 F.2d 400 (9th Cir. 1990).
Are trailing-assignment (holdover) clauses enforceable in Virginia?
Most likely tested for reasonableness, but the invention-specific application is undecided — and for a large statutorily covered class the risk is outright prohibition, not a trim. No Virginia decision found in our review has addressed a post-employment holdover invention-assignment clause. What Virginia has is a mature reasonableness framework for provisions that restrain post-employment competition — narrowly drawn, not unduly burdensome, not against public policy — plus Va. Code § 40.1-28.7:8, whose functional definition of a covenant not to compete could plausibly reach an aggressive trailing clause; if it does, the consequence for covered employees is statutory prohibition backed by a civil penalty, not reasonableness balancing. On a touch screen, a tap shows all 2 sources in this group.
Two layers define the Virginia picture: a well-settled common-law reasonableness rule for restraints on competition, and a fast-moving statute that prohibits covenants not to compete outright for a large covered class. Neither layer has been applied to a trailing invention-assignment clause by any Virginia decision found in our review.
The common-law framework comes from the Supreme Court of Virginia. Home Paramount Pest Control Cos. v. Shaffer gives the operative three-part standard .
The analysis is substance-over-label: the court weighs what the provision actually does, quoting its own earlier precedent for the elements it considers .
The employer carries the load throughout. Omniplex frames restrictive covenants as disfavored restraints, with the burden of proof on the employer and ambiguities construed against it .
And the scrutiny has tightened over time: Home Paramount struck a functionally overbroad clause identical to one the same court had upheld in 1989, expressly overruling its earlier decision .
The statutory layer is Va. Code § 40.1-28.7:8, enacted in 2020 (cc. 948, 949, originally codified as § 40.1-28.7:7) and substantially expanded in 2025 (c. 585) and 2026 (cc. 883, 1113, 1114). Its definition of a covenant not to compete is functional rather than label-bound — it reaches any agreement that restrains, prohibits, or otherwise restricts post-termination competition .
For covered employees the statute is a prohibition, not a reasonableness test: an employer may not enter into, enforce, or even threaten to enforce a covered covenant, and subsection E backs the ban with a civil penalty of $10,000 per violation .
The covered class is large and got much larger in 2025. Low-wage employee originally meant a worker earning below the Commonwealth's average weekly wage; the 2025 amendment (c. 585) extended it to every employee entitled to overtime under the federal Fair Labor Standards Act — that is, all FLSA non-exempt employees regardless of what they earn — along with interns, students, apprentices, trainees, and certain lower-paid independent contractors, with an exclusion for workers whose earnings are predominantly commission-based .
The 2026 amendments (cc. 883, 1113, 1114) added a separate rule that applies to all employees, not just the low-wage class: a covenant not to compete is unenforceable against an employee discharged without cause unless the employer provides severance or another monetary payment, and that severance must have been disclosed when the covenant was signed .
The statute does carve out a safe harbor — but for nondisclosure agreements, not assignments. Subsection H.1 preserves NDAs protecting trade secrets, as defined in Virginia's Uniform Trade Secrets Act at Va. Code § 59.1-336, and proprietary or confidential information; it says nothing about invention-assignment clauses .
Whether a trailing invention-assignment clause is a covenant not to compete under that functional definition is an open statutory question — no Virginia court has decided it, and no decision found in our review has even confronted it. A trailing clause does not forbid taking a job in terms; it transfers ownership of post-termination inventions. But an aggressive one — sweeping in all inventions for a fixed period after departure regardless of any connection to the employer's business — arguably otherwise restricts the former employee's ability to compete, since the ex-employee cannot exploit new inventions and becomes a riskier hire for competitors. The omission of assignment clauses from the H.1 safe harbor, which conspicuously protects trade-secret NDAs, cuts both ways in that argument. The stakes of the characterization are high: for the covered class — all FLSA non-exempt employees, sub-average-wage workers, health care professionals, and any employee discharged without cause where disclosed-at-execution severance is missing — a covered clause is prohibited and void, with a $10,000 civil penalty per violation, rather than trimmed to a reasonable scope. On a touch screen, a tap shows all 2 sources in this group.
Remedially, Virginia is unforgiving of overbreadth. In Roto-Die Co. v. Lesser, a federal court predicting Virginia law declined to adopt the blue-pencil rule — a court will not rewrite or trim an overbroad restraint to save it — while at the same time severing genuinely independent covenant subparts and enforcing the valid ones .
Roto-Die is a federal prediction — no square holding of the Supreme Court of Virginia adopting or rejecting blue-penciling was found in our review — but its two-sided rule matters for drafting: an overbroad holdover clause likely falls in its entirety, yet a structurally independent present-assignment clause bundled in the same agreement may survive through severance. And however the challenge arrives, it will be fact-bound: in Assurance Data, Inc. v. Malyevac the Supreme Court of Virginia held that the enforceability of a restraint on competition cannot be resolved on a demurrer, so an employer must be prepared to prove reasonableness with evidence .
Applying any of this to holdover assignments is a prediction, not a holding. The uncertainty comes from missing case law rather than ambiguous doctrine: Virginia's reasonableness framework and the statute are both well documented, but neither has been applied to a trailing invention-assignment clause by any decision found in our review. The safe reading is that an overbroad trailing clause is at meaningful risk in Virginia twice over — as an unreasonable restraint under the framework of Omniplex and Home Paramount , and, if characterized as a covenant not to compete, as a statutorily prohibited one for the large covered class — while a narrow holdover tied to the employer's trade secrets and confidential information, with a short tail and a genuine business nexus, remains the defensible zone.
Sources for this answer
Home Paramount Pest Control Cos. v. Shaffer, restating the test from Omniplex World Services Corp. v. US Investigations Services, Inc., gives Virginia's operative three-part standard for restraints on competition — narrowly drawn to protect a legitimate business interest, not unduly burdensome on the ability to earn a living, and not against public policy — the framework a holdover assignment clause would most likely be measured against.
It is enforceable if it “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.”
See Home Paramount Pest Control Cos. v. Shaffer, 282 Va. 412, 718 S.E.2d 762 (2011) (quoting Omniplex World Servs. Corp. v. US Investigations Servs., Inc., 270 Va. 246, 618 S.E.2d 340 (2005)).
Home Paramount Pest Control Cos. v. Shaffer, quoting Simmons v. Miller, holds that Virginia courts evaluate a restraint by weighing its function, geographic scope, and duration — a substance-over-label inquiry into what the provision actually restricts.
When evaluating whether the employer has met that burden, we consider the “function, geographic scope, and duration” elements of the restriction.
See Home Paramount Pest Control Cos. v. Shaffer, 282 Va. 412, 718 S.E.2d 762 (2011) (quoting Simmons v. Miller, 261 Va. 561, 544 S.E.2d 666 (2001)).
Omniplex World Services Corp. v. US Investigations Services, Inc. holds that restrictive covenants are disfavored restraints on trade in Virginia, that the employer bears the burden of proof, and that contractual ambiguities are construed in favor of the employee.
Because such restrictive covenants are disfavored restraints on trade, the employer bears the burden of proof and any ambiguities in the contract will be construed in favor of the employee.
See Omniplex World Servs. Corp. v. US Investigations Servs., Inc., 270 Va. 246, 618 S.E.2d 340 (2005).
Home Paramount Pest Control Cos. v. Shaffer struck a functionally overbroad restraint identical to one the Supreme Court of Virginia had upheld in 1989 and overruled that earlier decision — the clearest marker that Virginia's scrutiny of restraints on competition has tightened over time.
Therefore, to the extent that Paramount Termite conflicts with any portion of our holding today, Paramount Termite is overruled.
See Home Paramount Pest Control Cos. v. Shaffer, 282 Va. 412, 718 S.E.2d 762 (2011).
Va. Code § 40.1-28.7:8(A) defines a covenant not to compete functionally — any agreement that restrains, prohibits, or otherwise restricts post-termination competition — a label-blind definition that could plausibly reach an aggressive trailing invention-assignment clause, though no Virginia court has decided that question.
"Covenant not to compete" means a covenant or agreement, including a provision of a contract of employment, between an employer and employee that restrains, prohibits, or otherwise restricts an individual's ability, following the termination of the individual's employment, to compete with his former employer.
See Va. Code § 40.1-28.7:8(A).
Va. Code § 40.1-28.7:8(B) prohibits entering into, enforcing, or threatening to enforce a covenant not to compete with any low-wage employee or health care professional, and subsection E backs violations of the prohibition with a civil penalty of $10,000 per violation — a voidness-plus-penalty regime, not a reasonableness test.
No employer shall enter into, enforce, or threaten to enforce a covenant not to compete with any low-wage employee or health care professional.
See Va. Code § 40.1-28.7:8(B), (E).
Va. Code § 40.1-28.7:8(A), as amended in 2025 by c. 585, extends the definition of low-wage employee to any employee entitled to overtime compensation under 29 U.S.C. § 207 regardless of earnings — bringing all FLSA non-exempt employees into the covered class.
who, regardless of his average weekly earnings, is entitled to overtime compensation under the provisions of 29 U.S.C. § 207
See Va. Code § 40.1-28.7:8(A) (as amended by 2025 Va. Acts c. 585).
Va. Code § 40.1-28.7:8(C), added by the 2026 amendments (cc. 883, 1113, 1114), makes a covenant not to compete unenforceable against any employee discharged without cause unless severance or another monetary payment is provided, and requires that severance to have been disclosed when the covenant was executed.
No covenant not to compete between an employer and an employee is enforceable if such employer discharges such employee from employment without providing severance benefits or other monetary payment to such employee, unless such employer discharges such employee for cause. Such severance benefits or other monetary payment shall be disclosed upon execution of the covenant not to compete.
See Va. Code § 40.1-28.7:8(C) (as amended by 2026 Va. Acts cc. 883, 1113, 1114).
Va. Code § 40.1-28.7:8(H)(1) safe-harbors nondisclosure agreements protecting trade secrets, as defined in Va. Code § 59.1-336, and proprietary or confidential information — but says nothing about invention-assignment clauses, an omission relevant to whether a trailing assignment could be characterized as a covered covenant not to compete.
Nondisclosure agreements intended to prohibit the taking, misappropriating, threatening to misappropriate, or sharing of certain information to which an employee has access, including trade secrets, as defined in § 59.1-336, and proprietary or confidential information
See Va. Code § 40.1-28.7:8(H)(1).
Roto-Die Co. v. Lesser, a federal court predicting Virginia law, declined to adopt the blue-pencil rule — refusing to rewrite an overbroad restraint to save it — while severing genuinely independent covenant subparts and enforcing the valid ones, so an overbroad clause falls entirely but a structurally independent clause in the same agreement may survive.
While I believe paragraphs 7(a) and 7(b) are severable from paragraphs 7(c) and 7(d), I decline to adopt the so-called “blue pencil” rule.
See Roto-Die Co. v. Lesser, 899 F. Supp. 1515 (W.D. Va. 1995).
Assurance Data, Inc. v. Malyevac holds that whether a restraint on competition is enforceable cannot be decided on a demurrer — reasonableness is evidence-dependent, so a challenge to an assignment or holdover clause would be litigated on a factual record.
Because a demurrer cannot be used to decide on the merits whether a restraint on competition is enforceable, we will reverse the circuit court's judgment.
See Assurance Data, Inc. v. Malyevac, 286 Va. 137, 747 S.E.2d 804 (2013).
Va. Code § 40.1-28.7:8(A) defines a covenant not to compete functionally — any agreement that restrains, prohibits, or otherwise restricts post-termination competition — a label-blind definition that could plausibly reach an aggressive trailing invention-assignment clause, though no Virginia court has decided that question.
"Covenant not to compete" means a covenant or agreement, including a provision of a contract of employment, between an employer and employee that restrains, prohibits, or otherwise restricts an individual's ability, following the termination of the individual's employment, to compete with his former employer.
See Va. Code § 40.1-28.7:8(A).
Roto-Die Co. v. Lesser, a federal court predicting Virginia law, declined to adopt the blue-pencil rule — refusing to rewrite an overbroad restraint to save it — while severing genuinely independent covenant subparts and enforcing the valid ones, so an overbroad clause falls entirely but a structurally independent clause in the same agreement may survive.
While I believe paragraphs 7(a) and 7(b) are severable from paragraphs 7(c) and 7(d), I decline to adopt the so-called “blue pencil” rule.
See Roto-Die Co. v. Lesser, 899 F. Supp. 1515 (W.D. Va. 1995).
Home Paramount Pest Control Cos. v. Shaffer, restating the test from Omniplex World Services Corp. v. US Investigations Services, Inc., gives Virginia's operative three-part standard for restraints on competition — narrowly drawn to protect a legitimate business interest, not unduly burdensome on the ability to earn a living, and not against public policy — the framework a holdover assignment clause would most likely be measured against.
It is enforceable if it “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.”
See Home Paramount Pest Control Cos. v. Shaffer, 282 Va. 412, 718 S.E.2d 762 (2011) (quoting Omniplex World Servs. Corp. v. US Investigations Servs., Inc., 270 Va. 246, 618 S.E.2d 340 (2005)).
Do not assume a Virginia employee works like a California or Washington one. There is no invention-assignment statute here, so there is no statutory carve-out to rely on and no notice safe harbor — but there is a statutory trap on the restraint side: Va. Code § 40.1-28.7:8 defines a covenant not to compete by function, reaching anything that restrains, prohibits, or otherwise restricts post-termination competition, and no Virginia court has decided whether a trailing invention-assignment clause fits that definition . If it does, the clause is prohibited outright for a very large covered class — all FLSA non-exempt employees regardless of pay, sub-average-wage workers, health care professionals, and any employee discharged without cause where disclosed-at-execution severance is missing — with a $10,000 civil penalty per violation, not a reasonableness trim. Keep any trailing or holdover assignment narrow, short, and tied to identifiable trade secrets and confidential information, and remember that even outside the statute it must survive Virginia's narrowly-drawn, not-unduly-burdensome, public-policy test . Because Virginia courts will not blue-pencil an overbroad restraint — though genuinely independent provisions can be severed and enforced — house the present assignment (hereby assigns) of during-employment inventions and any holdover clause in separate, severable provisions, so an overreaching holdover does not take the core assignment down with it .
What does federal law require a confidentiality and invention assignment agreement in Virginia to say about whistleblowers and pay?
An employee confidentiality, non-compete, or invention assignment agreement signed or updated now that governs trade secrets or other confidential information must give the Defend Trade Secrets Act whistleblower-immunity notice, and for employees the National Labor Relations Act covers, Section 7 of that Act protects concerted activity, including joining together over pay and working conditions, that a broad confidentiality clause can restrict. The employer may satisfy the notice duty by cross-referencing a qualifying policy document provided to the employee, but an employer that omits the notice may not be awarded exemplary damages or attorney fees under the Defend Trade Secrets Act in an action against an employee who was not given notice.
The notice describes a federal immunity: an individual cannot be held liable under federal or state trade-secret law for disclosing a trade secret in confidence to a government official or an attorney solely to report or investigate a suspected violation of law, or in a court filing made under seal. For an agreement signed or updated now, the duty to give that notice reaches any agreement with an employee that governs trade secrets or other confidential information, whatever else the agreement does.
Section 7 gives employees the National Labor Relations Act covers a statutory right to engage in concerted activity for mutual aid or protection, including joining together to improve pay and working conditions. For employees the Act covers, the Board's work-rule standard adopted in 2023 makes a rule presumptively unlawful if it has a reasonable tendency to chill employees from exercising their Section 7 rights; an employer can rebut that presumption only by showing a legitimate and substantial business interest it cannot serve with a more narrowly tailored rule. The 2023 standard may change, but the Section 7 right it enforces is statutory. State law may add its own requirements for the same clauses.
A form carried over without the immunity notice, or a cross-reference to a reporting policy the employee never received, leaves the confidentiality clause without a valid notice, so the Act's exemplary damages and attorney fees are unavailable against that employee. A Confidential Information definition that sweeps in pay and working conditions with no carve-out exposes the employer to an unfair-labor-practice finding for employees the Act covers.
Sources for this answer
An individual is immune from criminal and civil liability under federal and state trade-secret law for disclosing a trade secret in confidence to a government official or an attorney solely to report or investigate a suspected violation of law, or in a court filing made under seal.
An individual shall not be held criminally or civilly liable under any Federal or State trade secret law for the disclosure of a trade secret that— (A) is made— (i) in confidence to a Federal, State, or local government official, either directly or indirectly, or to an attorney; and (ii) solely for the purpose of reporting or investigating a suspected violation of law; or (B) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal.
See 18 U.S.C. § 1833(b)(1).
An employer must give notice of the trade-secret whistleblower immunity in any contract or agreement with an employee that governs the use of a trade secret or other confidential information.
An employer shall provide notice of the immunity set forth in this subsection in any contract or agreement with an employee that governs the use of a trade secret or other confidential information.
See 18 U.S.C. § 1833(b)(3)(A).
An employer complies with the notice requirement by cross-referencing a policy document, provided to the employee, that sets out the employer's reporting policy for a suspected violation of law.
An employer shall be considered to be in compliance with the notice requirement in subparagraph (A) if the employer provides a cross-reference to a policy document provided to the employee that sets forth the employer's reporting policy for a suspected violation of law.
See 18 U.S.C. § 1833(b)(3)(B).
An employer that does not give the required notice may not be awarded exemplary damages or attorney fees in a trade-secret action against an employee who did not receive it.
If an employer does not comply with the notice requirement in subparagraph (A), the employer may not be awarded exemplary damages or attorney fees under subparagraph (C) or (D) of section 1836(b)(3) in an action against an employee to whom notice was not provided.
See 18 U.S.C. § 1833(b)(3)(C).
Section 7 gives employees the right to engage in concerted activities for mutual aid or protection, the statutory basis for keeping discussion of pay and working conditions outside confidentiality restrictions.
Employees shall have the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection, and shall also have the right to refrain from any or all of such activities except to the extent that such right may be affected by an agreement requiring membership in a labor organization as a condition of employment as authorized in section 158(a)(3) of this title.
See 29 U.S.C. § 157 (NLRA § 7).
The National Labor Relations Board protects the right of private-sector employees, with or without a union, to join together to improve wages, benefits, and working conditions.
Established in 1935, the National Labor Relations Board is an independent federal agency that protects employees from unfair labor practices and protects the right of private sector employees to join together, with or without a union, to improve wages, benefits and working conditions.
See NLRB Office of Public Affairs, news release of Feb. 21, 2023 (agency mission statement).
Under the work-rule standard the Board adopted in 2023, a rule with a reasonable tendency to chill employees from exercising their Section 7 rights is presumptively unlawful unless the employer proves a legitimate and substantial business interest it cannot advance with a more narrowly tailored rule.
Under the new standard adopted in Stericycle, the General Counsel must prove that a challenged rule has a reasonable tendency to chill employees from exercising their rights. If the General Counsel does so, then the rule is presumptively unlawful. However, the employer may rebut the presumption by proving that the rule advances a legitimate and substantial business interest and that the employer is unable to advance that interest with a more narrowly tailored rule.
See Stericycle, Inc., 372 NLRB No. 113 (2023); NLRB Office of Public Affairs, Board Adopts New Standard for Assessing Lawfulness of Work Rules (Aug. 2, 2023).