Written by Daryl G. Leon and Justin P. Murphy From BakerHostetler on February 27, 2025
Key Takeaways:
- The Federal Trade Commission (FTC) remains focused on “rooting out and prosecuting unfair labor-market practices that harm American workers.”
- The FTC will implement an internal Joint Labor Task Force (Task Force), comprised of representatives from the Bureau of Competition, Bureau of Consumer Protection, Bureau of Economics, and Office of Policy Planning to accomplish these goals.
- The scope of potential unfair practices subject to the Task Force’s scrutiny are broad, including noncompete, no-poach and no-hire agreements, but also alleged harmful occupational licensing requirements and “job scams.”
The Federal Trade Commission (FTC) will continue its focus on “unfair” competition in the labor markets – including the use of noncompete, no-poach and no-hire agreements – albeit with a seemingly more targeted approach than was pursued under the prior administration. In fact, by some reports, newly appointed FTC Chairman Andrew Ferguson stated that addressing unfair competition in the labor markets is “going to be one of the top priorities of the Trump-Vance FTC.” Consistent with this and Chairman Ferguson’s assertions during the Biden administration that the FTC was “wise to focus its resources on protecting competition in labor markets,” he issued a memorandum on February 26, 2025, instructing “the FTC’s Bureau of Competition, Bureau of Consumer Protection, Bureau of Economics, and Office of Policy Planning to work together to prioritize rooting out and prosecuting unfair labor-market practices that harm American workers.” The FTC’s Bureaus were directed to form an internal Joint Labor Task Force (Task Force), which will meet “at least monthly” to assess “all ongoing labor matters” and report quarterly to Chaiman Ferguson.
The list of potential harms that the FTC claims fall within the Task Force’s purview, and which will be scrutinized, is broad. Examples provided by the FTC include no-poach, non-solicitation or no-hire agreements, which, along with noncompetition agreements (also on the FTC’s list) have recently been targeted by the FTC and the Department of Justice. But the list also includes other topics that may suggest an expansion of the FTC’s review, particularly in response to the current political climate and labor market changes over the past years, such as “collusion or unlawful coordination on DEI metrics,” “harming gig economy workers,” “misleading franchise offerings,” “harmful occupational licensing requirements” and “job scams.”
Federal agencies during the first Trump administration demonstrated a willingness to investigate and prosecute novel and aggressive antitrust-related matters, including using the antitrust laws as a creative tool to enforce the administration’s views on the labor markets. Given that President Trump’s first administration prioritized and advanced labor-related investigations significantly, this current approach is not surprising and is consistent with what employers saw in 2017-2021. Further, according to Chairman Ferguson, “[t]he American people elected President Trump in no small part to fix the economic pain they are feeling under the current labor market” and the FTC, which has a “dual consumer-protection and competition mandate [is] therefore . . . uniquely well-suited to address these worker harms . . . .” Time will tell which of the alleged harmful practices will garner the most attention, and attempted enforcement, by the FTC and its Task Force. Until then, employers should continue to focus on federal agencies’ guidance and stated priorities, as well as applicable state and local laws, to ensure they are prepared for labor market scrutiny.
