The Department of Justice’s Antitrust Division and the Federal Trade Commission’s (FTC) Bureau of Competition jointly released a statement today affirming the importance of competition for American workers. The agencies also announced that they will protect competition for workers on the frontlines of the Coronavirus Disease 2019 (COVID-19) response in the United States by enforcing the antitrust laws against those who seek to exploit the pandemic to engage in anticompetitive conduct in labor markets.
The agencies acknowledged that some cooperation between government, business, and individual actors may be necessary in order to protect the health and safety of Americans. At the same time, the agencies informed the public that they are on alert for employers, staffing companies, and recruiters who might engage in collusion or other anticompetitive conduct that harms workers. Examples of such conduct include agreements to suppress or eliminate competition with respect to compensation, benefits, hours worked, and other terms of employment, as well as the hiring, soliciting, recruiting, or retention of workers.
“The Antitrust Division will not tolerate companies and individuals who use COVID-19 to harm competition that cheats payroll and non-payroll workers,” said Assistant Attorney General Makan Delrahim of the Department of Justice’s Antitrust Division. “This includes doctors, nurses, first responders, and those who work in grocery stores, pharmacies, delivery and distribution networks, and warehouses, among other essential service providers on the front lines of addressing the crisis. Even in times of crisis, we choose a policy of competition over collusion. The division will use its enforcement authority to ensure that companies and individuals who distort the free market for labor are held to account.”
“Many American workers are under a tremendous amount of stress because of COVID-19, and that includes essential workers and first responders,” said FTC Chairman Joe Simons. “We will not stand for any collusion among employers that would deprive workers of competitive compensation for their hard work.”
For years, the division and the FTC’s Bureau of Competition have challenged unlawful wage-fixing and no-poach agreements, anticompetitive non-compete agreements, and the unlawful exchange of competitively sensitive employee information, including salary, wages, benefits, and compensation data. Companies and individuals who enter into naked wage-fixing and no-poach agreements may be criminally prosecuted by the division, and those that invite collusion may be subject to civil enforcement by the bureau, even absent a collusive agreement, the statement further notes. The agencies may also use their civil enforcement authority to challenge unilateral anticompetitive conduct by employers that harms competition in a labor market. Companies and individuals involved in the hiring, recruiting, retention, or placement of workers should be aware that anticompetitive conduct runs the risk of civil and/or criminal liability.
The division recognizes that protecting American consumers during the COVID-19 event may require significant cooperation between federal, state, local, and tribal governments, private businesses, and individuals.
To that end, the division and the FTC previously released guidance that compiles additional and existing information and resources that can provide those responding to COVID-19 with a general understanding of how the agencies enforce the antitrust laws on joint conduct. At the same time, the agencies remain vigilant about detecting and stopping anticompetitive conduct in labor markets. Therefore, the division, along with the rest of the department, will continue working closely with other federal agencies, including our partners at the FBI, the FTC, the Department of Labor, and the Department of Health and Human Services, to assist its efforts.
The division established the Procurement Collusion Strike Force, an interagency partnership created to combat antitrust crimes and related schemes affecting procurement, grant, and program funding. The Strike Force is on high alert for collusive practices in the sale of COVID-19-related products to federal, state, and local agencies.