Following the Federal Trade Commission’s announcement late last year that the Agency would use Section 5 of the FTC Act to police aggressively conduct it deems unfair (see our Legal Alert), the Agency kicked off the New Year with two actions aimed at banning non-compete agreements between employers and workers. … Continue Reading
FTC and NLRB Announce New Coordination Efforts
The Federal Trade Commission (FTC) and the National Labor Relations Board (NLRB) recently announced a Memorandum of Understanding (MOU) resolving to enhance the enforcement of federal laws and regulations administered by these agencies, and to promote interagency collaboration through information sharing, cross-agency training, and coordinated outreach. The stated goal is to “better root out practices that harm workers in the ‘gig economy’ and other labor markets.” … Continue Reading
Colorado’s Newly Enacted Income-Based Non-Compete Law Marks Tightening of Restrictive Covenants
In May 2022, Colorado legislators passed a law that bans employee non-compete clauses for workers making less than six figures annually. Governor Jared Polis (D) signed the bill into law on June 8, 2022, giving it an effective date of August 10, 2022.
In short, HB 22-1317, imposes an income-based minimum on enforceable non-compete agreements between employers and employees. … Continue Reading
DaVita, Former CEO, Not Guilty in Criminal Case Over Alleged ‘No-Poach’ Agreements
The United States indicted DaVita, Inc., and Kent Thiry, DaVita’s former Chief Executive Officer, last year alleging that they had violated Section 1 of the Sherman Act by engaging in “Conspiracy in Restraint of Trade to Allocate Employees.” The essential elements of the criminal charges were alleged agreements with competitors not to poach each other’s employees.… Continue Reading
White House Executive Order Seeks To Limit Non-Competes
On July 9, 2021, the White House issued an executive order (“EO”) with the stated objective of countering anti-competitive forces throughout the economy. One specific directive is the limitation of non-compete agreements, which include not only restrictive covenants, but also “other clauses or agreements that may unfairly limit worker mobility.” Potentially, this could include customer and employee non-solicitation provisions, which some courts construe in the same manner as employee restrictive covenants. … Continue Reading
Podcast – A Deep Dive into “No-Poach” Agreements
The latest episode of Business Better is a discussion of “no-poach” agreements – agreements between competitors that neither will hire the other’s employees. We’ll discuss the different types of such agreements, their enforceability under antitrust and other laws and the possibility of criminal prosecution arising from their use, and how to protect a business from poaching without running afoul of the law.… Continue Reading
Chamber of Commerce Questions the Criminality of Employee No-Poach Agreements
Whether employee no-poach agreements are illegal per se is being tested in a criminal case, U.S. v. Surgical Care Affiliates LLC et al., drawing the attention of many interested parties, including the United States Chamber of Commerce (Chamber).
In 2016, the Federal Trade Commission (FTC) and the Department of Justice, Antitrust Division (DOJ or the Division) released joint guidance signaling that agreements between competing employers that “limit or fix the terms of employment” for prospective employees may violate antitrust laws. … Continue Reading