On October 20, the Federal Trade Commission and the Antitrust Division of the Department of Justice issued its “Antitrust Guidance for Human Resource Professionals” (“Guidance”) on the application of antitrust law to employment decisions.
As “no-poaching” agreements or agreements to fix employees’ wages or benefits can impede competition, the Antitrust Division has advised that these types of agreements should be treated similarly to other conduct such as price fixing.
With these concerns in mind, the Antitrust Division indicated that it will criminally investigate so-called “naked” no-poaching or wage-fixing agreements that are “separate from or not reasonably necessary to a larger legitimate collaboration between the employers.” Agreements that do not rise to the level of a criminal violation may still expose HR professionals to civil liability under antitrust statutes. The Guidance extends beyond agreements. The Antitrust Division advised that there are criminal and civil risks for information sharing, even in the event of a merger or acquisition, concerning employee compensation or terms of employment.
While no industry has been singled out in this most recent guidance, it is likely that the DOJ and FTC will continue their scrutiny of the healthcare and high-tech industries, where educated employees are in high demand.
Employers should consult with an employment attorney to prevent inappropriate discussions or agreements with competing firms.
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