Today, the Justice Department’s Antitrust Division and the Federal Trade Commission issued guidance for human resource (HR) professionals and others who are involved in hiring and compensation decisions, in order to educate and inform them about how the antitrust laws apply to their job responsibilities. Labor competition is a type of competition that our antitrust laws protect. The guidance issued today will help HR professionals learn about antitrust law so that they can conform to it and report potential violations. By doing so, HR professionals can play an important role in protecting employees and consumers and ensuring the competitiveness of the employment marketplace.
Workers are entitled to the benefits of a competitive market for their employment, and we are committed to protecting them from harmful conduct that stifles competition and can lead to decreased wages, less attractive benefits, or even lost job opportunities. We’re redoubling our efforts to help identify and deter anticompetitive conduct in hiring and employment practices that harm workers, such as agreements among competitors not to recruit each others’ employees or agreements to fix wages. These are serious violations and the division will act if it uncovers evidence of unlawful conduct in the employment context.
Antitrust violations can have severe consequences. HR professionals as well as their employers may both be subject to criminal fines and may face substantial civil liability, including treble damages lawsuits by those injured by the anticompetitive conduct. The individuals involved may face jail time. Going forward, the division intends to criminally investigate naked no-poaching or wage-fixing agreements unrelated or unnecessary to a larger legitimate collaboration between employers. These types of agreements eliminate competition in the same irredeemable way as agreements among competitors to fix the prices of goods or allocate customers, which have traditionally been criminally investigated and prosecuted as hardcore cartel conduct.
The antitrust laws also apply to firms’ decisions to share sensitive information, such as compensation information, with competing employers, either directly or through third party entities. Information sharing may violate antitrust law unless the information exchange is carefully designed to prevent harm to competition.
The agencies’ joint guidance includes a Q&A section that explains how antitrust law applies to various scenarios that HR professionals might encounter in their daily work lives. We also urge HR professionals and others who have information about possible antitrust violations to contact the Justice Department Antitrust Division’s Citizen Complaint Center or the Federal Trade Commission’s Bureau of Competition.
This quick reference card is a handy reference point for some of this information in a convenient, index-card-sized format. The card provides a list of antitrust red flags that HR professionals should look out for during their day-to-day work. The listed situations are not exhaustive, and the existence of a red flag does not necessarily imply an antitrust violation. Still, HR professionals should proceed with particular caution if they are confronted with any of the scenarios listed on the card.