Tuesday, May 11, 2021
1. Introduction
Labor market concentration and its potential effects on workers is a topic increasingly debated among antitrust practitioners and academics. The potential link between labor market concentration and lower wages has led to questions of whether and how labor issues should inform merger review and, more broadly, antitrust investigations. Covid-19 has strained some industries (such as airlines) and may result in consolidation of some employers, further raising labor market concentration concerns. This article describes some of the current research regarding labor concentration and its impact on workers, how labor concentration issues are being raised in the courts, and how economic analysis can inform antitrust inquiry moving forward.
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More than four years after the U.S. Department of Justice (DOJ) and U.S. Federal Trade Commission (FTC) jointly released the Antitrust Guidance for Human Resource Professionals in 2016 (Antitrust Guidance), the DOJ has brought its first criminal indictments for wage-fixing and no-poach agreements.
The 2016 Antitrust Guidance, released in the last few months of the Obama Administration, warned human resource professionals that agreements between competitors to set wages or to refrain from soliciting each other’s employees so-called no-poach agreements could result in criminal prosecution under U.S. antitrust laws. The guidance represented a considerable expansion of the agencies’ enforcement policy in labor markets, as the DOJ had previously only prosecuted such agreements civilly. The Antitrust Guidance advised that the agencies would treat such “naked” agreements, which are not reasonably necessary for a broa