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Up & Atom

As noted in this article by Morgan Lewis antitrust lawyers, the role of antitrust laws in labor markets, including in the energy field, remains a key area of focus by enforcers, including the Antitrust Division of the US Department of Justice and the Federal Trade Commission. At a public workshop on competition in labor markets in September 2019, Assistant Attorney General Makan Delrahim reaffirmed “that criminal prosecution of naked no-poach and wage-fixing agreements remains a high priority for the Antitrust Division.”

An agreement between two or more companies or employers that limits whether or how they can recruit or hire employees can violate the antitrust laws. From an antitrust perspective, such agreements—often called “no-poach” agreements—may harm employees by placing downward pressure on their compensation, as well as limiting their mobility and employment opportunities. Other arrangements between competing employers can violate the antitrust laws, too, because of their potential to negatively impact competition for labor. For example, when different companies agree to exchange information related to the terms of employment—such as compensation or benefits information—that can, in and of itself, potentially raise antitrust issues.

Thus, companies that enter into no-poach agreements, or exchange information about compensation or other terms of employment without first seeking guidance from experienced counsel, face legal risk. However, antitrust law recognizes that certain agreements between companies that limit hiring or solicitation of employees may be lawful depending on the circumstances, and may even be beneficial to competition. Similarly, antitrust law views information exchanges as both lawful and procompetitive provided certain requirements are followed. The article is intended to help employers navigate this uncertain antitrust legal landscape.