Uncertain Future for 2025 Antitrust Guidelines on Labor Practices

On January 16, 2025, the DOJ Antitrust Division and FTC released the Antitrust Guidelines for Business Activities Affecting Workers (Guidelines), replacing the 2016 HR Guidance. According to an article by the Skadden firm, the new Guidelines expand the scope of antitrust enforcement in labor markets, addressing noncompete clauses, no-poach agreements, and other restrictive employment conditions. However, the Guidelines face an uncertain future, as they were issued without bipartisan support and have been criticized by the newly appointed FTC leadership.

Key principles remain consistent with past guidance, including:

• Wage-fixing and no-poach agreements can be subject to criminal and civil enforcement.
• Informal agreements (even unwritten) may violate antitrust laws.
• Independent contractors are covered under antitrust scrutiny, reflecting concerns over gig economy practices.

The Guidelines expand enforcement theories to cover noncompete clauses and restrictive employment conditions, though these theories remain largely untested. The agencies assert that broad nondisclosure agreements, training repayment obligations, and exit fees could be unlawful if they hinder worker mobility. They also warn against information-sharing on wages, particularly through algorithms or third-party intermediaries.

Franchise no-poach agreements are explicitly highlighted as potentially illegal, though criminal enforcement in this area has been absent. Additionally, the Guidelines suggest that misleading earnings claims may trigger enforcement, referencing FTC actions under consumer protection laws rather than antitrust statutes.

Despite their broad reach, the antitrust guidelines include caveats, acknowledging ambiguity in enforcement. Given strong opposition from the new FTC leadership, their longevity is in question. Under the new administration, potential revisions or a return to the 2016 HR Guidance are likely. Risk and compliance teams should monitor developments closely.