Timothy Haley

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This post originally appeared on the Workplace Class Action blog.

Seyfarth Synopsis: There are currently pending at least four class actions claiming that provisions contained in franchise agreements prohibiting the hiring of employees of other intrabrand franchisees without the consent of their employer violate the antitrust laws.  That being said, in 1993 the Ninth Circuit affirmed summary judgment in favor of a franchisor in a similar “no-hire” case.  It reasoned that due to the control the franchisor exercised over its franchisees, the franchisor and its franchisees were incapable of conspiring in violation of Section 1 of the Sherman Act. While the so-called “single enterprise” defense is potentially available, franchisors should be cognizant that in developing that defense, they may create evidence or admissions that would support a subsequent claim that the franchisors are joint employers of their franchisees’ employees.  In light of the availability of other defenses, franchisor employers should assess whether the joint employer risk is worth accepting in order to pursue the single enterprise defense. 
Continue Reading Franchise “No-Hire” Agreement Class Actions And The Single Enterprise Defense

This post originally appeared on the Workplace Class Action blog. 

Seyfarth Synopsis: True to his word, the Assistant Attorney General for the Antitrust Division of the U.S. Department of Justice has announced the first of a number of anticipated no-poach enforcement actions. While this was a civil proceeding, the Department of Justice has said that in some cases it may treat the conduct as criminal. Many executives and HR professionals are unaware that the antitrust laws apply to the employment marketplace. Thus, if they have not done so already, employers should consider the implementation of compliance programs to make sure that appropriate employees are aware of these developments and risks.
Continue Reading DOJ Announces First of a Number of Anticipated No-Poach Enforcement Actions – What Should Employers Do Now?

This post originally appeared on the Workplace Class Action blog. 

Seyfarth Synopsis: On February 1, 2018, the U.S. District Court for the Middle District of North Carolina entered an order granting in part, and denying in part, the plaintiff’s motion for class certification in a no-hire antitrust case entitled Seaman v. Duke University, 1:15-CV-462, at 1-2 (M.D.N.C. Feb. 1, 2018) (A copy of the decision can be found here.) The case was brought against Duke University, Duke University Health System (collectively “Duke”), and various University of North Carolina entities and one of its executives (collectively “UNC”). The complaint alleged that the defendants had entered into an agreement not to hire each other’s medical faculty employees in violation of federal antitrust laws. With some notable exceptions it has been difficult for plaintiffs to achieve class certification in wage suppression cases such as Seaman. The ruling is a “must read” for employers, as the Court’s reasoning and conclusions make it difficult to predict whether this case will be helpful to the plaintiffs’ bar in other cases.

Background To The Case

Seaman, an Assistant Professor of Radiology at Duke, contended that she applied for a position at UNC in 2015. She alleged that she was denied consideration due to an agreement among the Duke and UNC defendants that they would not hire each another’s medical faculty employees unless the hire involved a promotion. Seaman alleged that this agreement not only suppressed the compensation of defendants’ medical faculty members, but also their other skilled medical employees. Thus, Seaman sought to certify a class consisting not only of defendants’ medical faculty members, but also their physicians, nurses, and skilled medical staff. Id. at 1-2.
Continue Reading Court Certifies Class In Duke-UNC No-Hire Workplace Antitrust Lawsuit

Seyfarth Synopsis:  Criminal prosecution of “no-poaching/no-hire” agreements appears imminent.  Employers should investigate their hiring and compensation practices to ensure compliance with recent antitrust pronouncements.

Background

In October 2016, the Department of Justice (“DOJ”) and the Federal Trade Commission (“FTC”) under the Obama Administration issued a joint Antitrust Guidance for Human Resource Professionals (“HR Guidance,” available here).  Among other things, the HR Guidance announced that so-called “naked” agreements among employers not to recruit employees or not to compete on employee compensation would be considered per se violations of the antitrust laws and prosecuted criminally. 
Continue Reading DOJ to Announce Criminal Enforcement Actions for “No-Poach” Agreements

Cross Posted from Employment Law Lookout.

Seyfarth Synopsis: On October 20, the DOJ and the FTC jointly issued their Antitrust Guidance for HR Professionals, stating that DOJ intends to pursue employers criminally for alleged wage fixing and no-poaching agreements.  

shutterstock_77814403On October 20, 2016, the DOJ and FTC jointly issued their “Antitrust Guidance for Human Resource Professionals.”  The…
Continue Reading HR Professionals Take Note: DOJ and FTC Issue Guidance Regarding Antitrust Laws in the Employment Context