While antitrust enforcement of non-poaching agreements is at its peak, several states and the District of Columbia are enacting laws prohibiting employers from entering into non-poaching agreements with competitors and including non-rehire and non-compete clauses in employment contracts. Given the federal and state government`s focus on competition in the labor market, employers must remain vigilant and ensure that their hiring practices comply with applicable antitrust and non-compete laws. The Department of Justice then filed an expression of interest in Seaman against Duke University in March 2019,[31] in which the plaintiffs claimed that the Duke University and University of North Carolina (UNC) medical schools at Chapel Hill had agreed to a policy prohibiting lateral faculty changes between Duke and UNC. [32] The Department of Justice pointed out that the non-poaching agreements per se were subject to analysis, noting that „Duke has not yet established a specific cooperation between it and the UNC […]for which the no-poaching agreement would have been a minor issue.“ [33] On January 4, 2018, the UNC defendants reached an agreement, and on May 20, 2019, Duke agreed to settle $54.5 million. As part of the settlement, the Department of Justice filed an uncontested motion to intervene in the Duke litigation and obtained the right to enforce an injunction against the continuation or repetition of the conduct in question, thus obtaining an unprecedented role as an executor in a private dispute. [34] On September 24, 2019, the District Judge approved the settlement. [35] Shortly after the announcement of its first criminal complaint related to wage agreements in January 2021, the MINISTRY of Justice announced its first criminal complaints related to non-poaching agreements. The conduct alleged in the SCA indictment involves a blatant agreement not to recruit employees from competitors. The Department of Justice received emails confirming the agreement and showing that SCA and other companies were adhering to it. Therefore, the indictment confirms the willingness of federal antitrust watchdogs to criminalize anti-competitive agreements that affect labor markets in the right case. The Department of Justice and the Federal Trade Commission also recently reaffirmed their commitment to a strict approach to bare agreements between employers in a joint statement addressing anti-competitive employment practices during the 2019 novel coronavirus (COVID-19) pandemic discussed in an April update. The U.S. Department of Justice (DOJ) and U.S.

Federal Trade (FTC) Guidelines („Guidance“) are available on the DOJ website[1]. In its guidelines, the Department of Justice states that „[a] person is likely to violate antitrust laws if he or she … agrees with people from another company to refuse to recruit or hire employees from that other company (so-called „no-poaching“ agreements). Id. at p. 3. The consequences of concluding a no-poaching agreement are significant. On the same page, the Department of Justice states that „non-poaching agreements between employers, whether entered into directly or through a third-party intermediary, are in themselves illegal under antitrust laws.“ As with other offences in themselves, non-poaching agreements are aimed at law enforcement measures, including the prosecution of the companies involved and individual decision-makers. The guidelines specify that although it is considering prosecution, it has so far only taken civil enforcement action for non-poaching agreements.

The United States has filed an expression of interest to express its opinion on the law applicable to naked non-poaching agreements, as claimed in the complaint. See U.S. Expression of Interest, In re: Railway Industry Employee No-Poach Antitrust Litig., 2:18-mc-00798 (W.D. Pa. February 8, 2019). In particular, the United States argued in its brief and at a hearing on 25 February 2019 that a naked no-poaching agreement was a kind of horizontal market sharing that had to be assessed according to the rule itself. The wave of criminal charges continued in March 2021, when the Department of Justice announced that it had secured a criminal indictment against a health staffing company and a former director of the company in Las Vegas, Nevada. [56] The company and former director Ryan Hee were accused of conspiring to set nurses` salaries. [57] It was alleged that Mr. Hee had entered into agreements with a competing company (which also provided contract care services to the school district) not to hire nurses employed by their respective companies and not to increase the salaries of those nurses. [58] The DOJ cited evidence of alleged communications between Mr.

Hee and his co-conspirator, including an email in which Mr. Hee stated, „According to our conversation, we will not hire any of your active [school district] nurses.“ [59] The application of the standard itself or the rule of reason has a significant impact on the outcome of a law enforcement action or dispute. If it turns out that an agreement is a „naked“ agreement without poaching, which means that the agreement has no other purpose than to restrict competition, the standard itself applies. Therefore, neither the Court nor the antitrust authorities will consider the proposed justifications for the agreement; it is illegal at first glance. However, if the standard of the rule of reason applies,. B, for example, if a non-solicitation clause is considered an ancillary provision to a broader agreement, the investigator will consider the commercial justifications for the restriction. As we explain below, there is no one-size-fits-all approach between antitrust authorities, attorneys general, and courts where the standard applies to non-poaching agreements. [34] Application to intervene, n° 1:15-cv-462 (MD.N.C 20 March 2019), ECF n° 352, www.justice.gov/atr/case-document/file/1164996/download. Referring to the justice Department`s unprecedented role in the settlement, former Deputy Attorney General Delrahim noted: „Demanding that the United States be part of this settlement agreement in this private cartel case, thus obtaining all the facilities and guarantees it would likely have sought after a lengthy investigation, shows the benefits that can be obtained effectively for the American worker. when public and private law enforcement agencies work together. DOJ, press release, „Department of Justice Seeks to Intervene in Private Class Actions to Enforce Ban on Illegal `No Poaching` Agreements (May 20, 2019), www.justice.gov/opa/pr/justice-department-seeks-intervene-private-class-action-enforce-prohibition-unlawful-no-poach. This result underscores that agencies and courts will continue to work together to meet these agreements.

In addition, the settlement released the claims of the faculty of medicine, but no claims of the non-medical faculties. In 2020, a second lawsuit was filed against the universities, as the class is made up of non-medical schools. The parties have reached a preliminary settlement agreement. Texas employers should take steps to ensure that interactions with other employers do not result in illegal agreements not to compete on terms and conditions of employment, including entering into no-poaching or no-hire agreements, in which companies commit not to recruit, advertise, or hire each other`s employees. .