In Virginia, 2020 was a big year for employment law in the state. That year, the state defined how it classifies employees and independent contractors, created a wage theft statute, began to study a minimum wage increase and put discrimination laws in place to protect marginalized groups. The changes made to Virginia laws will have a profound effect on Virginians for decades to come.
Pending Minimum Wage Increase
According to the National Law Review, the Virginia General Assembly submitted new legislation to increase Virginia's minimum wage from $7.25 to $9.50 by January 1, 2021. It would continue to increase incrementally over the next five years to reach $15 an hour by 2026. The bill would have required the General Assembly to hold a vote in 2024 for the two last and largest increases to take effect.
At the time of publication, the minimum wage in Virginia remains at $7.25 per hour in accordance with the federal Fair Labor Standards Act (FLSA). Overtime pay is also the same, at a minimum wage of $10.88 per hour.
Governor Ralph Northam suggested that the Assembly delay the first wage increase until May 1, 2021, due to the ongoing coronavirus pandemic, to which the Assembly agreed. Both the state Senate and House of Delegates also agreed to delay the first rate of pay increase. During this time and by legislation, the effects of this wage increase on the economy, income equality and workplace benefits are under study by three state agencies that will reveal their findings on December 1, 2023. Virginia also allows companies to pay employees a "training wage," which amounts to 75 percent of the minimum wage for workers in training programs that last a maximum of 90 days.
Minimum Wage Exemptions
Groups exempted from the minimum wage law in Virginia are:
- Workers covered by the Fair Labor Standards Act.
- Employees in domestic service, including those in private homes.
- Workers paid according to the amount of work they've done.
- Workers with intellectual or physical disabilities (excepting employees with a U.S. Department of Labor certificate).
- Employees who work for businesses that employ less than four people at a time.
- Workers under 18 years under the jurisdiction of domestic relations or juvenile court.
Virginia minimum wage law does not apply to these entities:
- Works in the Department of State's au pair program.
- Temporary foreign workers.
- Workers in some amusement or recreational establishments, religious or nonprofit educational conference centers or organized camps.
Pursuing Wage Claims in Virginia
In 2020, lawmakers implemented House Bill 123, which provided Virginia employees with legal remedies for an employer's nonpayment of earnings. If a worker successfully proves that they have not received their wages, they can recover them with prejudgment interest of 8 percent per year from the date the wages were due. If they can show that their employer knowingly refused to pay them, they can recover attorney's fees and receive an award triple the amount of their wages. This law went into effect on July 1, 2020.
The state also enacted the Virginia Wage Payment Act (VWPA). This law provides workers with wage protections including requirements such as payment of wages twice a month and deduction restrictions. Terminated workers can collect their earnings before or on the date they would have received payment had termination not taken place.
Independent Contractor Classification
To combat worker misclassification in the state, lawmakers enacted a statute that defines the differences between an independent contractor and an employee. Workers who are wrongfully classified can sue their employer to recover health insurance benefits, lost wages and other compensation.
Virginia believes that a person performing services for pay is an employee. However, it uses the IRS independent contractor test to define worker classification, which takes into account three elements: The first, behavioral, asks how much control a company has over a worker. The second, financial, looks at how payment affects the aspects of a worker's job. The final element is the relationship between the employer and the worker. In this instance, the test takes things like contracts and access to benefits into consideration when deciding on worker classification.
The Virginia Values Act
The Virginia General Assembly also passed the Virginia Values Act (VVA), which expands on protected classes in the Virginia Human Rights Act (VHRA) and gives these workers greater access to legal help. The VHRA covered companies with five to 15 employees who weren't covered by federal laws or antidiscrimination statutes because they were too small. It also prohibited firings based on creed, race, color, national origin and sex. There was, however, a limit in claimant awards – they could only collect a year's worth of back pay and a maximum of 25 percent attorney's fees based on that award.
VVA went into effect on July 1, 2020. It covers all antidiscrimination provisions (with the exception of age-related claims) for employers with at least 15 employees. Employers with at least five employees have coverage for termination claims and those with age-related claims have coverage for companies with at least 19 employees.
The VVA also expanded protected class coverage to include marital and veteran status, gender identity and sexual orientation. Successful claimants can now receive a maximum of $350,000 in punitive damages, an unlimited award in compensatory damages, attorney's fees and court-ordered injunctions that may reinstatement them.
The VVA and Motherhood
The VVA prohibits discrimination around pregnancy and childbirth-related medical conditions. It requires companies to accommodate these limitations as long as the business does not suffer undue hardship in the process. For example, a new mother may need longer lactation breaks; a company must provide reasonable accommodations for this and can no longer ask the employee to take a leave of absence. A company can not retaliate against a worker for exercising her rights, and a claimant can sue for violation of these rights without filing an administrative complaint.
Under state law, Virginia employers must post notice of VVA's new antidiscrimination laws in a conspicuous workplace location. They must also retool their employee handbooks to include this information and give it to new hires. Women who share the news of their pregnancy with their employer should expect to receive VVA information within 10 days of telling the company of their condition.
- IRS: Independent Contractor (Self-Employed) or Employee?
- Minimum Wage: Virginia Overtime Pay Laws for 2020, 2021
- Virginia Legislature: House Bill 123
- Virginia Law: Code of Virginia Section 40.1-29. Time and medium of payment; withholding wages; written statement of earnings; agreement for forfeiture of wages; proceedings to enforce compliance; penalties.
- Virginia Values Act: SB 868 Discrimination; prohibited in public accommodations, etc., causes of action, civil actions
Michelle Nati is an associate editor and writer who has reported on legal, criminal and government news for PasadenaNow.com and Complex Media. She holds a B.A. in Communications and English from Niagara University.