The Department of Justice Antitrust Division (DOJ) and the Federal Trade Commission (FTC) (together, the Agencies) issued Antitrust Guidelines for Business Activities Affecting Workers (2025 Guidelines) in January. The 2025 Guidelines replace the 2016 Antitrust Guidance for Human Resource Professionals (2016 Guidelines). The 2025 Guidelines provide five business practices that the antitrust agencies may investigate as potential violations of antitrust laws and two clarifications about the scope of the antitrust laws for workers.
The five business practices:
- “Some types of agreements, including wage-fixing and no-poach agreements, may violate the antitrust laws and can lead to criminal charges”
This issue was identified in the 2016 Guidelines and is expanded on in the 2025 Guidelines. One key expansion is the explicit guidance that agreements to fix wages or not hire employees are illegal even if they did not result in actual harm. Another is the guidance that agreeing to a “range, ceiling, or benchmark for calculating wages” is illegal even if the agreement does not include a specific wage. - “Franchise no-poach agreements may violate the antitrust laws”
This guidance is an addition to the 2016 Guidelines, which did not plainly identify no-poach agreements contained in franchise agreements as a potential violation.
Agreements to not hire contained within franchise agreements are distinguishable from the DOJ’s recent prosecutions of no-poach agreements because the franchisee/franchisor no-poach agreements are ancillary restraints subject to the rule of reason analysis. As a reminder, ancillary restraints are those limitations that are reasonably linked to a legitimate cooperation or economic integration, such as a merger agreement, joint venture, or distribution/franchise arrangement.
To support their guidance on franchise no-poach agreements, the Agencies primarily rely on private litigations like Arrington v. Burger King Worldwide, Inc., 57 F. 4th 1247 (11th Cir. 2022) and Deslandes v. McDonald’s USA, LLC, 81 F. 4th 699, 705 (7th Cir. 2023). The Agencies have not litigated or prosecuted franchise-related no-poach agreements.
It is unclear whether courts would support the Agencies’ contention that no-poach agreements related to franchise agreements violate the antitrust laws. The Deslandes v. McDonald’s decision only goes as far as to say that it is possible to find a per se violation, but the Seventh Circuit remanded the matter to the district court.
The limited support demonstrates a key point—these are guidelines, not rules. While companies would do well to abide by the 2025 Guidelines to avoid risk, the guidance is not law. - “Sharing competitively sensitive information—including wage information—with competitors may violate antitrust laws”
This guidance was included in the 2016 Guidelines, but there are key differences in the 2025 Guidelines.
First, the 2016 Guidelines provided safe harbors for information exchange. The 2025 Guidelines do not refer to these safe harbors, and the Agencies’ withdrawal of the HealthCare Guidelines adds doubt as to the viability of these safe harbors.
Second, the 2025 Guidelines clarify that competitively sensitive information shared through algorithms or third-party products could violate the antitrust laws. Under this scenario, a company providing its competitively sensitive information to a noncompetitor third party that then aggregates and disseminates reports to the company and others subscribed to the third party’s service could be violating the antitrust laws through a hub and spoke conspiracy.
Third, the 2025 Guidelines note that third-party-generated wage or benefit recommendations can violate the antitrust laws even if the information exchange does not require strict adherence to the recommendations. - “Non-compete clauses can violate antitrust and other laws”
This is a new area of guidance. The 2016 Guidelines noted that “this guidance does not address the legality of specific terms contained in contracts between an employer and an employee, including non-compete clauses.”
The Agencies identify two harms related to non-competes. First, non-competes decrease competition for workers because they prevent workers from leaving jobs to pursue other employment. Second, non-competes harm businesses by preventing them from obtaining workers to enter new markets.
To support their guidance, the Agencies cite to the FTC’s enforcement actions under Section 5 of the FTC Act, as opposed to Sherman Act enforcements. The legality of non-competes under the Sherman Act is untested. The 2025 Guidelines also discuss the FTC’s non-compete rule, which a court set aside. Finally, the Agencies cite various other laws that non-competes violate, including the National Labor Relations Act, the Packers and the Stockyards Act, and state laws.
Non-competes are another area where the law is not necessarily supportive of the Agencies’ 2025 Guidelines. It is unclear whether courts will agree that non-competes violate the antitrust laws, but companies should be mindful that other employment laws could be violated. - “Other restrictive, exclusionary, or predatory employment conditions can also be unlawful”
This final guidance is new in the 2025 Guidelines and is a catchall. The Agencies list four practices that could potentially violate the antitrust laws: nondisclosure agreements; training repayment agreement provisions; non-solicitation agreements; and exit fee and liquidated damages provisions.
The 2025 Guidelines note that whether these restrictive or exclusionary practices violate the antitrust laws is highly fact dependent. The analysis starts, however, with whether the practice limits a worker from seeking or accepting another job or starting a business.
The two scope clarifications:
- “The antitrust laws apply to agreements that businesses reach with independent contractors”
This clarification reminds businesses that when considering whether a business practice violates the antitrust law, independent contractors are workers. The 2025 Guidelines specifically note that the above guidance applies to digital platforms that match contractors to consumers seeking services. - “False earnings claims can violate the law”
This clarification reminds businesses that the FTC can and does take enforcement actions related to false advertisements related to compensation of workers
Takeaways
Chairman Andrew Ferguson and Commissioner Melissa Holyoak dissented to the release of the 2025 Guidelines because it coincided closely with the administration transition, but they agreed that the antitrust laws protect workers. It remains to be seen if the Trump administration withdraws this guidance, but in the meantime, employers should:
- Ensure employees know who is authorized to enter into contracts on behalf of the company and continue to instruct employees to not enter into agreements with competitors that impede hiring between the companies or otherwise allocate labor.
- In situations where the company is engaging in a joint venture or other collaboration with a competitor, hire antitrust counsel to review non-compete, non-solicitation, or other ancillary agreements that could be perceived as restraining hiring.
- Remind human resource professionals, corporate development, and other deal teams that competitively sensitive information includes wages, benefit costs, and other labor-related costs. The competitively sensitive employee information should not be shared among competitors, and a deal clean room should be used for diligence exchanges.
- Ask antitrust counsel to review any use of third-party data aggregators for benchmarking employee salary, other compensation, benefits, retirement funds, or restrictive stock units to ensure the information provided to and received from the data aggregator is properly safeguarded from potential antitrust violations
For more information on the 2025 Guidelines and how they may impact your business, contact the Robin Crauthers, Tiffany Hubbard, or the McCarter & English attorney with whom you work.