Antitrust Concerns in No-Poach, Wage-Fixing, and Non-compete Agreements

Summary

This practice note addresses antitrust risks involved in non-compete agreements and other agreements between employers affecting labor markets. In 2016, the DOJ and FTC announced that the federal government would begin criminally prosecuting employers for certain common employment practices, including no-poach agreements, wage-fixing or benefit-fixing agreements, and non-compete clauses. This development constituted a significant shift in the application of antitrust law to labor markets. After a period of relative quiet, the DOJ began bringing criminal enforcement actions challenging such agreements as per se illegal (with limited success), while private litigants secured a number of significant victories and settlements. Earlier this year, the FTC promulgated a new rule that would ban virtually all non-compete clauses and render pre-existing non-competes unenforceable, with a narrow exception for certain senior executives. Although the rule is being widely challenged (and was ...