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Clifford Chance

Clifford Chance


No-Poach, Per Se – DOJ Antitrust Division Weighs in to Reiterate Antitrust Review Standard to Be Applied to Employment Agreements

30 April 2019

The Antitrust Division of the U.S. Department of Justice recently submitted Statements of Interest in several no-poach class actions, in which the plaintiffs alleged that the defendants'
agreements not to hire each other's employees violated Section1 of the Sherman Act. In its Statements of Interests, the DOJ argued that no-poach agreements between horizontal competitors are per se Section 1 violations, unless the agreement is ancillary to a legitimate business purpose. The DOJ took the position that, when tied to a franchise agreement, no-poach agreements should be analyzed under the rule of reason. The Statements of Interest and the DOJ's participation in these matters, which come on the heels of the DOJ's investigations into several companies' no-poach practices and the publication of the DOJ and Federal Trade Commission's Antitrust Guidelines for Human Resource Professionals, highlight the importance the DOJ is currently placing on the application of the antitrust laws to the labor market.

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