The Virginia Values Act
August 7, 2020
On July 1, 2020, the Virginia Values Act, which expands the breadth of the Virginia Human Rights Act (VHRA) considerably, went into effect. Both employers and employees alike are well-advised to consider how these changes affect their work and their ongoing business.
Increased Protections for Employees and Coverage for Employers
The Virginia Values Act amended the Virginia Human Rights Act, expanding the employers it covers and adding new employee protections. The most notable of these changes include:
- Sexual orientation and gender identity have been added to the list of protected classifications.
- Employment discrimination claims are now likely to be filed in state court. In practice, this means that many more claims will now be permitted to go to trial.
- The law expands coverage of the VHRA to all employers with more than 15 employees. In addition, now all employers with more than 5 employees can be subject to claims for unlawful discharge.
Relief for Employees
Formerly, an employee’s damages could not exceed 12 months of back pay – with no punitive or compensatory damages available – and employees were entitled to only limited recovery on attorneys’ fees, which were capped at 25 percent of the total back-pay award. These limitations have been removed, and employees can now seek damages for all of the following:
- Back pay
- Legal fees and expenses (without limitations)
- Punitive damages
- Compensatory damages
- Injunctive relief
Early Requirements
Before filing against a claim against his or her employer, an employee must first obtain a right to sue letter by submitting an administrative charge to the Virginia Division of Human Rights. after receipt of a determination letter, the employee then has 90 days to file his or her civil action against his or her employer.
This time constraint, however, is waived for those employees who’ve been discriminated against based on pregnancy, the birth of a child, or a medical condition related to either of these. Further, employers are required to prominently post – and disseminate – the prohibitions against pregnancy-based discrimination and the related right to reasonable accommodations for known pregnancy-related limitations.
Further Considerations for Employers
An important consideration for employers is that, while discrimination cases were typically filed in federal court, they are now more likely to be filed in state courts, where access to summary judgment is less common. In the past, many employers counted on summary judgments to stop many cases from proceeding to trial. In practical terms, employers can reasonably expect to see more claims make it to trial as a result of the Virginia Values Act.
Wage Changes
In addition to the Virginia Values Act, two important wage-related acts have also become law, including:
- The Minimum Wage Act – The Virginia Minimum Wage Act is slated to increase the state’s minimum wage to $9.50 an hour in May of 2021 and to increase the minimum wage incrementally thereafter until it reaches $15.00 an hour in January of 2026 (the increases in 2025 and 2026 are contingent upon reenactment of the Minimum Wage Act in 2024).
- Wage Payment Act – The Virginia Wage Payment Act allows employees to bring suit against any employer who withholds wages, and recoverable damages include the total amount of wages withheld, interest, liquidated damages, and legal fees and expenses.
Worker Classification
The Virginia Values Act eliminates the uncertainly related to classifying employees as independent contractors that some employers have taken advantage of over the years. Under the Act, all workers are deemed employees unless their employers can prove otherwise. Such proof must include the application of the IRS’s stringent requirements for contract workers.
If misclassified as an independent contractor, the employee can now – under the Virginia Values Act – seek damages for all lost wages, salary, and employees benefits, which can include those expenses that would have been covered by insurance, the cost of bringing the case against the employer in the first place, and all reasonable legal fees. The employer may also experience penalties levied by the Virginia Department of Professional and Occupational Regulation (DPOR). Finally, construction contractors should take special note that, under the Values Act, they may now share liability for any misclassification of workers made by subcontractors.
Expansion of Whistleblower Protections
Employees’ whistleblower protections have also been expanded, and as of July 1, 2020, whistleblower protections apply to employees in all of the following situations:
- An employee who reports a state, federal, or regulatory violation either to a supervisor, to law enforcement, or to any governmental body
- An employee who is requested – by either law enforcement or a governmental body – to participate in an inquiry, investigation, or hearing
- An employee who provides testimony or information to law enforcement or to any governmental body regarding an employer’s alleged state, federal, or regulatory violation
- An employee who refuses to participate in a work task he or she deems criminal
- An employee who refuses to follow through with work orders that are state, federal, or regulatory violations and who shares his or her reason for refusal with his or her employer
Noncompete Agreements for Low-Wage Earners
With the implementation of the Virginia Values Act comes newly-minted restrictions regarding the enforcement of non-compete agreements for those classified as low-wage earners. This low-wage label is reserved for those who earn less than $59,124 annually (with some caveats for sales- and commission-based workers). Not only are employees entitled to seek compensation for their damages, but employers can also face considerable fines per violation.
Consult with an Experienced Virginia Corporate Attorney Today
Virginia employers are well-advised to take careful note of the full range of employee protections offered by the Virginia Values Act. The corporate attorneys at McClanahan Powers, PLLC, are committed to helping you effectively and efficiently transition to careful compliance with these legal changes – in both your daily operations and your business overall. Whatever your corporate legal concerns, please don’t hesitate to contact or call us at 703-520-1326 today.