No Poach Agreement


No-Poach remains an active area of antitrust legislation, as do labour competition issues in general. This appears to have led to a general trend towards employers removing restrictions that would make it more difficult for workers to strive to raise wages. Until a few years ago, these agreements were widespread in the technology sector, but according to the Department of Justice, they are contrary to the right to be. After the 2016 DOJ Antitrust Guidance for Human Resources Professionals: the United States filed a declaration of interest to express its opinion on the law applicable to non-poaching agreements, as the complaint asserts. See U.S. Statement of Interests, Re: Railway Industry Employee No-Poach Antitrust Litig., 2:18-mc-00798 (W.D. Pa. Feb. 8, 2019). In particular, in its letter and at a hearing on February 25, 2019, the United States argued that a simple non-poach agreement was a kind of horizontal market allocation that had to be evaluated according to the rule itself.

In addition to the granting of the DOJ and FTC guidelines for cartels and abuse of dominance for human resources professionals, the division has presented expressions of interest in private cartel and abuse of dominance proceedings, which are pending in several federal district courts. As part of the division`s expanded Amicus program, the United States presented expressions of interest to provide a more complete presentation of the application of Section 1 of the Sherman Act to employer agreements that do not compete for workers. In any event, the applicants have argued similar facts: the franchisor and the franchisee have entered into agreements that prohibit franchisees from recruiting or recruiting employees from other franchisees or franchisors. The parties submitted dismissal applications and the parties to the proceedings expressed differing views on whether a franchisor and a franchisee could conspire within the meaning of Section 1 of the Sherman Act and what rule of analysis should govern whether the no-poach agreements between the franchisors and their franchisees violate Section 1. When future or current employees sign a non-compete agreement, they should always be offered compensation for agreeing to the terms. This is because, in accordance with this type of clause, the employee effectively limits his ability to earn a living in his area of expertise. Summary – In general, DOJ surveys weigh on companies, threaten individual decision makers and are very troublesome for the company, so the prospect of an investigation should be sufficient to prompt each company to stop and take note of this risk. In this context, the return to our hypothetical safest approach for our client with respect to preventing an antitrust investigation by the DOJ, the FTC, State AG or the civil counsel is not to authorize a “no-poaching” agreement with a potential competitor for the services of its employees. , but rather to implement some of the alternative strategies mentioned above.