Antitrust Action Against No-Poaching Agreements: Obama Policy to Be Continued by the Trump Administration
On October 20, 2016—just about three weeks before the presidential election won by Donald Trump—the Department of Justice and the Federal Trade Commission issued a remarkable document, entitled “Antitrust Guidance for Human Resources Professionals,”which outlined an aggressive policy promising to investigate and punish employers, and even individual Human Resources employees, who enter into unlawful agreements concerning recruitment or retention of employees. As stated in that document, “[a]n agreement among competing employers to limit or fix the terms of employment for potential hires may violate the antitrust laws if the agreement constrains individual firm decision-making with regard to wages, salaries or benefits; terms of employment; or even job opportunities.”
For over a year, a question on the minds of many practitioners was whether the Antitrust Guidance document and policy would remain a priority for the DOJ and FTC under President Trump. Those agencies had not issued public pronouncements, and there was uncertainty over whether conduct like wage-fixing and no-poaching agreements would continue to warrant serious civil or criminal scrutiny. Would the new administration continue the Obama Administration’s antitrust guidance initiative or would it lean more toward a more laissez-faire, do-not-interfere with corporate management philosophy?
We may now have the answer. The Trump administration has voiced support of this Obama-era policy. On Jan. 19, 2018, U.S. Assistant Attorney General for the Antitrust Division Makan Delrahim remarked at a conference that if employers have engaged in no-poaching or wage-fixing agreements since the issuance of the policy, their actions will be treated as criminal. He noted the Antitrust Division has “been very active” in reviewing potential violations, and that, “[i]n the coming couple of months, you will see some announcements, and to be honest with you, I’ve been shocked about how many of these there are, but they’re real.”
Employers and practitioners should stay tuned for these announcements from the Antitrust Division.