Agreement Not To Hire Employees Antitrust

The department will continue to vigorously enforce labour market agreement legislation and will continue to inform lawyers, businesses and individuals of how antitrust laws apply to recruitment and compensation decisions. [4] Leah Nylen, Number of no-poach agreements uncovered by DOJ `shocking`, official says MLex Market Insight, May 17, 2018. What is a non-poaching clause? A “non-poaching” clause is a written or oral promise by one or both parties to an agreement not to compete with employees during the term of the contract or for a period after the termination of the personnel of the other party or one of the parties. They may appear in agreements as “non-recruitment”, “non-solicitation”, “no-hire” or a similar clause that influences an employee`s ability to move from one company to another. At a glance, the court conducts an abridged inquiry – less than the full rule of reason – “where the high probability of anti-competitive effects can be easily established.” The department disapproves of this approach and favors the full rule of reason, at least in the franchised environment, given that no-poach deals can offer competitive advantages and foster competition between brands, factors that might be overlooked in a brief review. Summary – Generally speaking, DOJ surveys are cumbersome for companies, threaten individual decision-makers, and are very troublesome for business, so the prospect of an investigation should be enough for each company to stop and take note of this risk. In this context, the safest approach for our client, which is to avoid antitrust scrutiny by the DOJ, FTC, State AG or the private plaintiff`s lawyer, is not the approval of a no-poaching agreement with a potential competitor for the services of its employees, but the implementation of some of the aforementioned alternative strategies. Has. Infringements of anti-cartel rules are severely punished.

If the government decides to seek criminal penalties, a company can be fined up to $100 million, while individuals should expect fines of up to $1 million and imprisonment for up to 10 years. [1] The maximum penalties may be increased to amounts corresponding to the double profit of the offence or the double loss of the victims of the offence if one of these sums is greater than the legal maximum penalty. . . .

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