ANTITRUST GUIDANCE 

FOR HUMAN RESOURCE 

PROFESSIONALS

DEPARTMENT OF JUSTICE

ANTITRUST DIVISION

FEDERAL TRADE COMMISSION

OCTOBER 2016

This document is intended to alert human resource (HR) 

professionals and others involved in hiring and 

compensation decisions to potential violations of the 

antitrust laws. The Department of Justice Antitrust 

Division (DOJ or Division) and Federal Trade Commission 

(FTC) (collectively, the federal antitrust agencies) jointly

enforce the U.S. antitrust laws, which apply to 

competition among firms to hire employees. An agreement 

among competing employers to limit or fix the terms of 

employment for potential hires may violate the antitrust 

laws if the agreement constrains individual firm decisionmaking with regard to wages, salaries, or benefits; terms 

of employment; or even job opportunities. HR 

professionals often are in the best position to ensure that 

their companies’ hiring practices comply with the 

antitrust laws. In particular, HR professionals can 

implement safeguards to prevent inappropriate 

discussions or agreements with other firms seeking to hire 

the same employees.
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The antitrust laws establish the rules of a competitive 

employment marketplace. 

Free and open markets are the foundation of a vibrant economy. Just as 

competition among sellers in an open marketplace gives consumers the 

benefits of lower prices, higher quality products and services, more choices, 

and greater innovation, competition among employers helps actual and 

potential employees through higher wages, better benefits, or other terms of 

employment. Consumers can also gain from competition among employers 

because a more competitive workforce may create more or better goods and 

services.

From an antitrust perspective, firms that compete to hire or retain employees 

are competitors in the employment marketplace, regardless of whether the

firms make the same products or compete to provide the same services. It is 

unlawful for competitors to expressly or implicitly agree not to compete with 

one another, even if they are motivated by a desire to reduce costs. Therefore, 

HR professionals should take steps to ensure that interactions with other 

employers competing with them for employees do not result in an unlawful 

agreement not to compete on terms of employment. Any company, acting on 

its own, may typically make decisions regarding hiring, soliciting, or 

recruiting employees. But the company and its employees should take care 

not to communicate the company’s policies to other companies competing to 

hire the same types of employees, nor ask another company to go along.

The federal antitrust agencies have taken enforcement actions against 

employers that have agreed not to compete for employees. Based on those 

cases, here are some general principles to help HR professionals and the 

companies they represent avoid running afoul of the antitrust laws as they 

relate to agreements and communications among employers. Note that this 

guidance does not address the legality of specific terms contained in contracts 

between an employer and an employee, including non-compete clauses.

Violations of the antitrust laws can have severe consequences. Depending on 

the facts of the case, the DOJ could bring a criminal prosecution against 

individuals, the company, or both. And both federal antitrust agencies could 

bring civil enforcement actions. In addition, if an employee or another private 

party were injured by an illegal agreement among potential employers, that 
DOJ/FTC ANTITRUST GUIDANCE FOR HR PROFESSIONALS

OCTOBER 2016 3

party could bring a civil lawsuit for treble damages (i.e., three times the 

damages the party actually suffered). 

 

Agreements among employers not to recruit certain employees or 

not to compete on terms of compensation are illegal. 

 

An HR professional should avoid entering into agreements regarding terms of 

employment with firms that compete to hire employees. It does not matter 

whether the agreement is informal or formal, written or unwritten, spoken or 

unspoken. 

An individual likely is breaking the antitrust laws if he or she: 

• agrees with individual(s) at another company about employee

salary or other terms of compensation, either at a specific level or 

within a range (so-called wage-fixing agreements), or

• agrees with individual(s) at another company to refuse to solicit or 

hire that other company’s employees (so-called “no poaching”

agreements).

Even if an individual does not agree orally or in writing to limit employee 

compensation or recruiting, other circumstances – such as evidence of 

discussions and parallel behavior – may lead to an inference that the 

individual has agreed to do so. 

Naked wage-fixing or no-poaching agreements among employers, whether 

entered into directly or through a third-party intermediary, are per se illegal 

under the antitrust laws. That means that if the agreement is separate from 

or not reasonably necessary to a larger legitimate collaboration between the 

employers, the agreement is deemed illegal without any inquiry into its 

competitive effects. Legitimate joint ventures (including, for example, 

appropriate shared use of facilities) are not considered per se illegal under 

the antitrust laws.

The DOJ filed a civil enforcement action against the Arizona Hospital & 

Healthcare Association for acting on behalf of most hospitals in Arizona to set 

a uniform bill rate schedule that the hospitals would pay for temporary and 

per diem nurses. The case resulted in a consent judgment. And in the past 

few years, the DOJ brought three civil enforcement actions against 
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technology companies (eBay and Intuit, Lucasfilm and Pixar, and Adobe, 

Apple, Google, Intel, Intuit, and Pixar) that entered into “no poach” 

agreements with competitors. In all three cases, the competitors agreed not to 

cold call each other’s employees. In two cases, at least one company also 

agreed to limit its hiring of employees who currently worked at a competitor. 

All three cases ended in consent judgments against the technology 

companies. The FTC has brought two cases relating to competition for 

employment. One was against Debes Corp. for entering into agreements to 

boycott temporary nurses’ registries in order to eliminate competition among 

the nursing homes for the purchase of nursing services. The FTC also 

brought a case against the Council of Fashion Designers of America and the 

organization that produces the fashion industry’s two major fashion shows for 

attempting to reduce the fees and other terms of compensation for models. 

Both cases ended in consent judgments. 

Going forward, the DOJ intends to proceed criminally against naked wagefixing or no-poaching agreements. These types of agreements eliminate 

competition in the same irredeemable way as agreements to fix product 

prices or allocate customers, which have traditionally been criminally 

investigated and prosecuted as hardcore cartel conduct. Accordingly, the DOJ 

will criminally investigate allegations that employers have agreed among 

themselves on employee compensation or not to solicit or hire each others’ 

employees. And if that investigation uncovers a naked wage-fixing or nopoaching agreement, the DOJ may, in the exercise of its prosecutorial 

discretion, bring criminal, felony charges against the culpable participants in 

the agreement, including both individuals and companies. 

Avoid sharing sensitive information with competitors. 

Sharing information with competitors about terms and conditions of 

employment can also run afoul of the antitrust laws. Even if an individual 

does not agree explicitly to fix compensation or other terms of employment, 

exchanging competitively sensitive information could serve as evidence of an

implicit illegal agreement. While agreements to share information are not per 

se illegal and therefore not prosecuted criminally, they may be subject to civil 

antitrust liability when they have, or are likely to have, an anticompetitive 

effect. Even without an express or implicit agreement on terms of 

compensation among firms, evidence of periodic exchange of current wage 
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information in an industry with few employers could establish an antitrust 

violation because, for example, the data exchange has decreased or is likely to 

decrease compensation. For example, the DOJ sued the Utah Society for 

Healthcare Human Resources Administration, a society of HR professionals 

at Utah hospitals, for conspiring to exchange nonpublic prospective and 

current wage information about registered nurses. The exchange caused

defendant hospitals to match each other’s wages, keeping the pay of 

registered nurses in Salt Lake County and elsewhere in Utah artificially low. 

The case ended in a consent judgment so that registered nurses could benefit 

from competition for their services.

Even if participants in an agreement are parties to a proposed merger or 

acquisition, or are otherwise involved in a joint venture or other collaborative 

activity, there is antitrust risk if they share information about terms and 

conditions of employment. 

However, not all information exchanges are illegal. It is possible to design 

and carry out information exchanges in ways that conform with the antitrust 

laws. For example, an information exchange may be lawful if:

• a neutral third party manages the exchange,

• the exchange involves information that is relatively old,

• the information is aggregated to protect the identity of the underlying 

sources, and 

• enough sources are aggregated to prevent competitors from linking 

particular data to an individual source.

Also, in the course of determining whether to pursue a merger or acquisition, 

a buyer may need to obtain limited competitively sensitive information. Such 

information gathering may be lawful if it is in connection with a legitimate 

merger or acquisition proposal and appropriate precautions are taken.

For more information on information exchanges, you can review the DOJ’s 

and FTC’s specific guidance to the healthcare industry on when written 

surveys of wages, salaries, or benefits are less likely to raise antitrust 

concerns (see Statement 6). 

If your company is considering sharing specific information or otherwise 

collaborating with competitors regarding compensation or other terms of 
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employment, and you have questions regarding the legality of the activity, 

the federal antitrust agencies are available to offer further guidance. The 

Division has a business review process that enables businesses to determine 

how the Division may respond to proposed joint ventures or other business 

conduct. The FTC has a similar process for obtaining an advisory opinion for 

future conduct. When the federal antitrust agencies are able to analyze and 

comment on the possible competitive impact of proposed business conduct 

before that conduct is implemented, companies are more likely to avoid 

enforcement investigations and lawsuits.

__________ 

 

Questions and Answers 

 

 Question: I work as an HR professional in an industry where we spend a 

lot of money to recruit and train new employees. At a trade show, I 

mentioned how frustrated I get when a recent hire jumps ship to work at a 

competitor. A colleague at a competing firm suggested that we deal with this 

problem by agreeing not to recruit or hire each other’s employees. She 

mentioned that her company had entered into these kinds of agreements in 

the past, and they seemed to work. What should I do? 

 Answer: What that colleague is suggesting is a no-poaching agreement. 

That suggestion amounts to a solicitation to engage in serious criminal 

conduct. You should refuse her suggestion and consider contacting the 

Antitrust Division’s Citizen Complaint Center or the Federal Trade 

Commission’s Bureau of Competition to report the behavior of your 

colleague’s company. If you agree not to recruit or hire each other’s 

employees, you would likely be exposing yourself and your employer to 

substantial criminal and civil liability. 

 Question: My friend and I are both managers at different companies in 

an industry where employee wage growth seems to be out of control. Over 

lunch, my friend proposed that we could solve this problem by reaching out to 

other industry leaders to establish a more reasonable pay scale for our 

employees. Is this legal?

 Answer: An agreement among competitors to set wages or establish a 

pay scale is an illegal wage-fixing agreement. If you take your friend’s 

suggestion and form such an agreement on behalf of your company with your 
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friend or others acting on behalf of their companies, you would likely be 

exposing yourself and your employer to substantial criminal and civil 

liability. The DOJ could open a criminal investigation, and if it determines 

that your agreement is a naked wage-fixing agreement, it could bring 

criminal charges against you, your employer, your friend, and other 

individuals or companies that participate in the agreement. Participants 

could also be subject to substantial civil liability.

Additionally, merely inviting a competitor to enter into an illegal 

agreement may be an antitrust violation – even if the invitation does not 

result in an agreement to fix wages or otherwise limit competition. In 

antitrust terms, an “invitation to collude” describes an improper 

communication to an actual or potential competitor that you are ready and 

willing to coordinate on price or output or other important terms of 

competition. For instance, the FTC took action after an online retailer 

emailed a competitor to suggest that both companies sell their products at 

the same price, which was higher than either company was charging. The 

competitor declined the invitation and notified the FTC. Be aware that 

private communications among competitors may violate the FTC Act if (1) the 

explicit or implicit communication to a competitor (2) sets forth proposed 

terms of coordination (3) which, if accepted, would constitute a per se

antitrust violation.

 

 Question: I work as a senior HR professional at a nonprofit organization 

that works hard to keep costs down so we can serve more people. One idea we 

had is to cap wage increases for certain employee groups, but we are worried 

that we might lose employees to other nonprofit organizations that don’t cap 

wage increases. So, I would like to call other nonprofit organizations in my 

region to ask them if they would consider a cap on wage growth rates as well. 

Should I do that? What if, instead of reaching out to other nonprofit 

organizations directly, we all agree to hire the same consultant who 

communicates the pay scale to the nonprofit organizations?

 Answer: No. You would likely violate antitrust law if you and the other 

nonprofit organizations agreed to decrease wages or limit future wage 

increases. A desire to cut costs is not a defense. Your nonprofit organization 

and the others are competitors because you all compete for the same 

employees. It does not matter that your employer and the other organizations 

are not-for-profit; nonprofit organizations can be criminally or civilly liable 

for antitrust law violations. It also makes no difference if you propose to hire 

a consultant who will determine and set the pay scale; employing a third-
DOJ/FTC ANTITRUST GUIDANCE FOR HR PROFESSIONALS

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party intermediary does not insulate you or your organization from liability 

under the antitrust law. 

Question: I work in the HR department of a university that sometimes 

gets into bidding wars to attract faculty from rival institutions. Those efforts 

rarely succeed, but they take up a lot of time, energy, and resources. Recently 

someone in the Dean’s office told me that we now had a “gentleman’s 

agreement” with another university not to try to recruit each other’s senior 

faculty. There isn’t a written agreement, and efforts to hire each other’s 

faculty were rarely successful. Is this okay?

Answer: No. An illegal agreement can be oral; it need not be written 

down on paper. This conduct is similar to the conduct challenged by the 

Division in its recent no-poaching cases involving eBay, Lucasfilm, and 

Adobe, and the FTC in its cases against Debes Corp. and the Council of 

Fashion Designers. If the no-poaching agreement is naked, that is, separate 

from or not reasonably necessary to a larger legitimate collaboration between 

the universities, it is conduct that the Division will criminally investigate and 

may decide to criminally prosecute, charging institutions or individuals or 

both.

If you stopped recruiting and bidding for faculty from another 

university due to a gentleman’s agreement, you have become a member of 

that no-poaching agreement and could be subject to criminal liability. You 

should take no further action to comply with that agreement, and notify your 

university’s legal counsel of the university’s participation in this illegal 

agreement. The university may wish to report the conduct to the Division 

under its Corporate Leniency Policy, which provides that the first qualifying 

corporation (including universities and other non-profit entities) to report the 

antitrust offense and cooperate with the Division’s investigation will not be 

criminally charged for the reported antitrust offense. If you have already 

participated in the illegal agreement, you may wish to report the conduct to 

the Division under its Leniency Policy for Individuals, which provides that 

the first qualifying individual to report the antitrust offense and cooperate 

with the Division’s investigation will not be criminally charged for the 

reported antitrust offense. For more information on these policies, see this 

link. 

 

Question: I am the CEO of a small business. In my industry, firms 

traditionally offer gym memberships to all employees. Gym membership fees 

are increasing, so I would like to stop offering memberships, but I am worried 
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that current employees will become disgruntled and move to other 

companies. I would like to ask other firms in the industry to stop offering 

gym memberships, as well. Can I do that?

Answer: No, you would likely violate antitrust law if you and the other 

companies agreed to cease offering gym memberships. Job benefits such as 

gym membership, parking, transit subsidies, meals, or meal subsidies and 

similar benefits of employment are all elements of employee compensation. 

An agreement with a competitor to fix elements of employee compensation is 

an illegal wage-fixing agreement. 

 

 Question: I am an HR professional who serves on the board of our 

industry’s professional society. We are interested in determining current and 

future trends in industry wages. Can we distribute a survey asking 

companies within the industry about current and future wages?

 Answer: It may be unlawful for you, a member of the industry, to 

solicit a competitor’s company-specific response to a wage survey that asks 

about current or future wages, or to respond to a competitor’s request to 

provide such information. In addition, it may be unlawful for the professional 

society to distribute company-specific information about past, current, and 

future wages. Competitors’ exchange of nonpublic, company-specific 

information about current and future wages may violate antitrust law, unless 

certain survey procedures are followed to mitigate the risk of competitive 

harm. 

For more guidance on the antitrust treatment of information 

exchanges among competitors, see Statement 6 of the DOJ’s and FTC’s 

guidance to the healthcare industry.

 Question: I am a new HR professional, and I am attending my first 

professional conference next week. What should I watch out for to avoid 

violating antitrust law? 

 Answer: You should not enter into agreements about employee 

compensation, other terms of employment, or employee recruitment with 

other HR professionals who work at competitors, meaning other companies 

that compete for the same types of employees. Also, avoid discussing specific 

compensation policies or particular compensation levels with HR 

professionals who work for competitors.
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Other resources are available. 

The federal antitrust agencies have prepared a list of red flags that HR 

professionals and others should look out for in employment settings.

 

When in doubt, seek legal assistance. 

If HR professionals have questions regarding whether particular conduct 

violates the antitrust laws, they should consider seeking legal advice. 

 

Report potential violations. 

If HR professionals or other interested parties have information about a 

possible antitrust violation regarding agreements among competitors to fix 

wages, salaries, benefits, or other terms of employment, or agreements not to 

compete for employees in hiring decisions, the federal antitrust agencies 

encourage them to report such conduct.

Reports can be made to the Division through the Citizen Complaint Center 

by e-mail (antitrust.complaints@usdoj.gov), phone (1-888-647-3258, toll free 

in the U.S. and Canada, or 202-307-2040), or mail (Citizen Complaint Center, 

950 Pennsylvania Avenue, NW, Room 3322, Washington, DC 20530). 

Reports can be made to the FTC through the Bureau of Competition’s Office 

of Policy and Coordination by email (antitrust@ftc.gov), phone (202-326-

3300), or mail (Office of Policy and Coordination, Room CC-5422, Bureau of 

Competition, Federal Trade Commission, 600 Pennsylvania Avenue, NW, 

Washington, DC 20580).

The federal antitrust agencies encourage HR professionals or others with 

information to use the following questions as a guideline to describe your 

complaint.

• What are the names of companies, individuals, or organizations that 

are involved?

• In what manner have these companies, individuals, or organizations 

potentially violated the federal antitrust laws?
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• What examples can you give of the conduct that you believe may 

violate the antitrust laws? Please provide as much detail as possible.

• Who is affected by this conduct? 

• How do you believe competition may have been harmed?

• What is your role in the situation?

With respect to potential criminal violations, in particular, it can be 

beneficial to report personal involvement in an antitrust violation quickly. 

Through the Division’s leniency program, corporations can avoid criminal 

conviction and fines, and individuals can avoid criminal conviction, prison 

terms, and fines, by being the first to confess participation in a criminal 

antitrust violation, fully cooperating with the Division, and meeting other 

specified conditions. Additional information about the leniency program is 

available here.