Dive Brief:
- The U.S. Department of Justice (DOJ) filed its first criminal charge alleging a group of employers agreed not to poach each other’s employees, the agency announced Jan. 7.
- The agency alleged Surgical Care Affiliates LLC and a related entity agreed with competitors not to solicit each others’ senior-level employees.
- "The charges demonstrate the Antitrust Division’s continued commitment to criminally prosecute collusion in America’s labor markets," said Assistant Attorney General Makan Delrahim in a statement. "Along with our law enforcement partners, the division will ensure that companies who illegally deprive employees of competitive opportunities are not immune from our antitrust laws."
Dive Insight:
DOJ warned HR professionals in 2016 that no-poach and wage-fixing agreements violate federal law, and that such violations could carry criminal penalties including 10-year prison terms.
A little more than a year later, Delrahim told attendees at a conference that the agency would soon announce indictments. Its first charge came shortly thereafter but until now, it had only pursued civil charges.
And while this first criminal charge came during the Trump administration, the agency’s efforts may well continue: "The indictment against SCA is likely just the beginning of DOJ’s employee-allocation criminal enforcement," Cozen O’Connor attorneys wrote for the firm.
HR professionals should be aware that such agreements are a per se violation of the law, meaning the agreement itself is illegal, DOJ has said; the government need not point to an individual who was harmed by it.
To avoid such violations, HR pros can work to understand the law, perform an antitrust audit and devise a reporting mechanism for concerns, employment attorneys previously told HR Dive. Compliance training also is key, they said.
