Antitrust Pitfalls for HR

By Mercedes Pineda

HR professionals and others involved in hiring and compensation decisions might be violating antitrust laws.  HR professionals must take special care not to enter into “agreements” with competing companies about the terms of employment, in particular any agreements about what wages to offer or agreements not to poach each other’s employees.  Even an informal, unwritten, unspoken agreement might still violate antitrust laws.

HR professionals should avoid sharing sensitive information about their employer’s terms and conditions of employment with other employers, as this too may create an anticompetitive effect subject to antitrust laws.  For example, in one case, the DOJ sued an association of HR professionals at Utah hospitals, for conspiring to exchange nonpublic prospective and current wage information. This plan allowed the hospitals to match each other’s wage and ultimately to keep the pay artificially low.  Although exchanging information may be lawful under some limited circumstances, the bar is difficult to identify.  The DOJ intends to proceed criminally against these agreements that eliminate competition between employers, so HR professionals should brush up on the antitrust laws and implement safeguards to prevent potential violations.  For some helpful scenarios, take a look at the DOJ’s Antitrust Guidance. Remember also that the Administration has announced that it intends to stifle simple non-compete agreements as well.