Anti-Trust Laws Can Impact HR Departments

You can add anti-trust laws to the long list of legal risks that must now be managed by corporate HR departments. According to a recent guidance document prepared by the Federal Trade Commission and the Department of Justice, the following acts could result in not only civil liability, but criminal prosecution:

• Agreements between companies to not recruit or hire the other’s employees (a/k/a no-poaching agreements)
• Talking to other industry members about establishing uniform pay scales or caps on pay
• Agreements between competitors to limit or reduce fringe benefits

These laws can be especially tricky in the context of trade associations or other industry groups that exist to promote sharing of information among industry members. Generally, sharing information without any agreement to take uniform action is not a violation of the law, but the lines between legal and illegal conduct can be blurry. The threat of criminal prosecution and the encouragement of competitors to report violations to the DOJ’s hotline make it even more important for HR departments to understand the law in this area. Our firm’s client alert on the subject can be found here, and the recent “Antitrust Guidance for Human Resource Professionals” can be found here.