PEOs in Virginia

What makes Virginia different

• Pay transparency arrived July 1, 2026: Va. Code 40.1-28.7:12 requires the wage or salary range in every public and internal job posting and bars asking for or using a candidate's pay history, with Attorney General penalties up to $1,000 for a first violation and $5,000 after that.
• Non-competes are banned for every employee entitled to overtime under the FLSA, not just low earners, for agreements signed on or after July 1, 2025 (Va. Code 40.1-28.7:8). Each violation carries a $10,000 civil penalty, and employers must post the law or face escalating fines.
• The minimum wage is $12.77 for 2026, and 2026 legislation set fixed steps: $13.75 on January 1, 2027 and $15.00 on January 1, 2028, with inflation indexing resuming in 2029.
• The unemployment taxable wage base is $8,000 and has not changed since 1990, one of the lowest in the country, so unemployment tax is a small lever in any Virginia PEO proposal.
• The Virginia Human Rights Act covers employers with just 5 or more employees (and 1 or more for domestic workers), reaching businesses far below the 15-employee federal Title VII threshold.
• Workers compensation is mandatory at more than 2 employees, counting part-time, seasonal, and temporary workers, and Virginia uses NCCI classifications, so class codes map cleanly from most other states.

PEO regulation in Virginia

Virginia registers PEOs through the Workers Compensation Commission under Va. Code 65.2-803.1, not an insurance or labor licensing board. Registered PEOs must report new and terminated clients within 30 days and file an annual client report each January. Ask the Commission or the provider for proof of current registration before signing. For unemployment, the VEC has PEOs open their own employer account with a full client list attached, so ask which account and rate your wages will be reported under and get the answer in writing.

What a PEO does and does not solve here

The 2026 session changed the compliance work a Virginia PEO should be doing: postings now need compliant pay ranges, non-compete templates need rewriting for non-exempt staff, and both carry state penalties. Test candidate providers on those two changes specifically. A provider that has not updated its Virginia handbook and posting workflows since 2025 is behind the law it is selling you protection from.

Common questions

Whose unemployment account covers our employees inside a Virginia PEO?

Virginia has no statute forcing client-level reporting the way some states do. The VEC registration form has the PEO identify itself and attach its client list, which points to reporting under the PEO's account in practice. Ask the specific provider which account number your wages are reported under, what rate is charged on the invoice versus paid to the VEC, and what your rate would look like if you later leave.

Will a PEO keep our job postings legal under the new pay transparency law?

Only if that duty is assigned. Va. Code 40.1-28.7:12 applies to public and internal postings for jobs, promotions, and transfers, and many postings are written by hiring managers outside any PEO workflow. Have the service agreement state who reviews postings for compliant ranges, and train managers not to ask candidates about pay history, which the same law prohibits.