Written by Dee Bansal, Beatriz Mejia, Julia Brinton and Lauren Hirsch From Cooley LLP on August 12, 2025
This is an extract from the 2026 edition of the Americas Antitrust Review published by Global Competition Review. The whole publication is available here.
This is an Insight article, written by a selected contributor as part of GCR’s co-published content. Read more on Insight
In summary
Five months into the new administration, federal antitrust enforcers continue to prioritise competitive labour markets. In February 2025, US Federal Trade Commission (FTC) Chairman Andrew Ferguson formed a Joint Labor Task Force to ‘prioritize investigation and prosecution of deceptive, unfair, or anticompetitive labour market conduct’, including no-poach, nonsolicitation, no-hire, wage-fixing and noncompete agreements.
Additionally, in April 2025, the US Department of Justice (DOJ) secured its first wage-fixing jury trial conviction, with the head of the Antitrust Division proclaiming that, ‘[t]he Antitrust Division will zealously prosecute those who seek to unjustly profit off their employees’.
Discussion points
- Overview of no-poach agreements
- No-poach trends
Referenced in this article
- Department of Justice
- Federal Trade Commission
- Employment agreements
- United States v Lopez
- United States v Surgical Care Affiliates, LLC
Introduction
It has been more than four years since the Department of Justice (DOJ) filed its first criminal antitrust indictment based on an alleged ‘no-poach’ agreement – an agreement between or among employers from different companies not to recruit or solicit each other’s employees. To date, the DOJ has initiated at least seven criminal no-poach or wage-fixing cases. The DOJ achieved notable victories in the early stages of several of these cases, surviving motions to dismiss in five of them and securing a guilty plea in one.
But the DOJ also has experienced notable setbacks. In four cases, it has been unable to convince juries or judges to find the defendants criminally liable for antitrust violations, and following this string of losses, the DOJ in 2023 voluntarily dismissed its last pending no-poach case, United States v Surgical Care Affiliates, LLC (SCA), without reaching a final verdict or judgment. Since then, the DOJ has brought no new criminal no-poach cases.
However, in the final days of the Biden administration, the DOJ and the FTC jointly adopted new Antitrust Guidelines for Business Activities Affecting Workers (the 2025 guidelines), in which both agencies broadened their views on when agreements impacting labour markets could be illegal and reemphasised the FTC and DOJ’s commitment to protecting workers. Although Ferguson, the incoming chairman, dissented from the adoption of the 2025 guidelines on procedural grounds, after he became chairman, neither the FTC nor the DOJ rescinded or amended those guidelines.
In February 2025, after Ferguson was confirmed as FTC chairman, he directed the FTC to form a task force dedicated to protecting the competitiveness and fairness of labour markets.
Similarly, Gail Slater, assistant attorney general of the DOJ’s Antitrust Division, has indicated in her public remarks that the DOJ remains committed to enforcing the antitrust laws to protect labour markets, as part of the administration’s America First Antitrust agenda.
Further, in April 2025, the DOJ secured its first jury trial win in a criminal wage-fixing case, United States v Lopez.
In light of the FTC and DOJ’s continued dedication to enforcing against anticompetitive restraints in labour markets, this article summarises the legal landscape and recent developments.
Antitrust issues associated with no-poach agreements
Agreements subject to antitrust enforcement in the employment context
We start by providing an overview of the types of agreements that are generally subject to antitrust scrutiny in the labour context.
Agreements subject to antitrust scrutiny may be between employers from different companies or between an employer and its employees. Agreements between different employers include:
- wage-fixing agreements – a form of price fixing in which employers agree to fix salaries at a certain level or within a certain range, or to calculate salary offers according to certain guidelines;
- no-poach or nonsolicitation agreements – agreements not to recruit another company’s employees; and
- no-hire agreements – agreements not to hire another company’s employees.
An agreement between an employer and its employees that may raise antitrust risk is a noncompete agreement, which limits the ability of an employee to join or start a competing firm after a job separation.[1] Nonsolicitation agreements also arise between employers and employees and limit the ability of an employee to solicit a company’s clients, customers or other employees after leaving the company.
The DOJ and FTC (together, the antitrust agencies) have focused on these agreements, asserting that competition in the labour market provides actual and potential employees with higher wages, better benefits and more varied types of employment – all of which ultimately benefit consumers because ‘a more competitive workforce may create more or better goods and services’.[2] The antitrust agencies, therefore, argue that competition for employees is akin to competition for products and services and should be protected and promoted.
Critically, in analysing agreements under the antitrust laws, the term ‘competitor’ includes any firm that competes to hire the same employees, regardless of whether the firm makes similar products or provides similar services.[3] This broad definition of ‘competitor’ distinguishes the competitive analysis for labour from the analysis applied in other antitrust contexts, where the focus is more on current, future or potential competition for goods sold and services offered.
As a result, firms may be subject to antitrust liability for entering into certain labour-side agreements with other firms, even if those firms otherwise operate in different industries.
Antitrust laws applied to agreements in the employment context
The relevant antitrust laws that apply to no-poach and other employment agreements are section 1 of the Sherman Antitrust Act (Sherman Act), which prohibits contracts that unreasonably restrain trade,[4] and section 5 of the Federal Trade Commission Act, which prohibits unfair methods of competition and unfair or deceptive acts or practices.[5]
Under the Sherman Act, there are two fundamental standards of review:
- the per se standard, which applies to certain acts or agreements that are deemed so harmful to competition with no significant countervailing procompetitive benefit that illegality is presumed; and
- the ‘rule of reason’, which applies to all other conduct and agreements, and pursuant to which the fact finder weighs the procompetitive benefits of the restraint against its potential harm to competition to determine the overall competitive effect.[6]
The US Supreme Court has stated that the rule of reason is ‘presumptively’ applied, and there is a ‘reluctance’ to adopt the per se standard.[7] Historically, agreements between competitors (ie, horizontal agreements) to engage in hardcore conduct, such as price fixing, market allocating or bid rigging, are treated as per se illegal, while other conduct, including vertical agreements (ie, agreements between two firms at different levels in the chain of distribution) and ancillary restraints (ie, those that are ‘reasonably necessary’ to a separate, legitimate, procompetitive integration) are subject to the rule of reason.[8]
Depending on the circumstances, no-poach agreements may be analysed under either the per se standard or the rule of reason standard. Whether the per se or rule of reason standard applies has significant implications for the outcome of an enforcement action or litigation. If an agreement is found to be a ‘naked’ no-poach agreement, meaning there is no purpose for the agreement other than to restrict competition, the per se standard applies. As such, neither the court nor the DOJ or FTC will consider any proposed justifications for the agreement; it is illegal on its face. If, however, the rule of reason standard applies, such as if a nonsolicitation provision is found to be ancillary to a larger agreement, then the fact finder will consider the business justifications for the restraint.
The penalties for violating the antitrust laws are severe and apply at both the company and the individual levels. For per se criminal violations, companies face a maximum fine of up to US$100 million or twice the gross gain or gross loss suffered, while an individual may be fined up to US$1 million or face a 10-year prison sentence.[9] For civil matters, the DOJ or plaintiffs may seek treble damages against companies.[10] This is in addition to reputational damage, the potential for required changes to business practices and oversight monitoring as a result of a government consent decree, along with the significant time and effort to defend against an investigation or lawsuit.
Recent no-poach trends
Antitrust scrutiny of no-poach and other types of agreements in the employment context is not new; there has been civil enforcement and litigation going back nearly a decade, and promoting competition in labour markets has been a focus for years. Historically, however, enforcement was restricted to civil enforcement actions only and primarily against companies in the healthcare and technology industries.[11] That changed in early 2021, when the DOJ announced its first criminal indictment relating to no-poach agreements,[12] and the DOJ has filed half a dozen lawsuits based on these agreements since.
Below, we highlight three recent trends relating to no-poach agreements.
- The DOJ has had success defeating motions to dismiss but has not, to date, secured a guilty jury verdict in a no-poach case. This year, however, the DOJ secured its first guilty jury verdict in a criminal wage-fixing case, suggesting the DOJ will remain interested in criminally prosecuting labour market restraints moving forward.
- There are learnings from the DOJ’s sole guilty plea, including how the DOJ calculates fines in no-poach cases and the potential importance of restitution.
- Civil prosecution of no-poach and wage-fixing agreements continues, and the FTC’s focus on labour market competition could mean an increase in civil enforcement actions.
DOJ finds success in wage-fixing case, stemming the tide on a string of no-poach losses
The antitrust agencies first took the position that the DOJ would criminally prosecute no-poach agreements in 2016, when they issued joint guidance[13] regarding the application of the federal antitrust laws to hiring practices and certain employment agreements.[14] They warned the business community that, ‘[g]oing forward, the DOJ intends to proceed criminally against naked wage-fixing or no-poaching agreements’.[15]
The DOJ has followed through on its commitment, filing criminal indictments in at least seven separate cases, with the most recent on 15 March 2023.[16] The DOJ has been able to convince judges to deny motions to dismiss, allowing cases to proceed under the theory that no-poach agreements may be per se illegal under the antitrust laws.
The stumbling block for the DOJ has been getting juries to agree that the defendants are guilty; the DOJ has not been able to secure a guilty verdict on any no-poach claims, and its sole guilty verdict in a no-poach case was on an obstruction charge relating to no-poach allegations. In United States v Patel, its most recent defeat, the case did not even get to the jury before the judge granted the defendants’ motion for acquittal, finding that ‘no reasonable juror could conclude there was a “cessation of meaningful competition” in the allocated market’.[17]
However, the DOJ has seen recent success in its pursuit of a wage-fixing criminal conviction. In United States v Lopez, the DOJ obtained a guilty verdict against Eduardo Lopez, a healthcare staffing executive charged with conspiring to cap the wages of home healthcare nurses in Las Vegas, Nevada.[18] After a 15-day trial, Lopez was convicted of one count of conspiracy in restraint of trade under section 1 of the Sherman Act for wage fixing, as well as five additional felony counts for wire fraud.[19]
The procedural history in Lopez may be indicative of the stronger and more well-established legal ground on which the DOJ stands in wage-fixing cases compared to no-poach cases. Not only did Lopez reach the trial stage (and a guilty verdict), but defendant Lopez did not even attempt to move to dismiss his wage-fixing charge, instead moving to dismiss only the wire counts.[20] In celebrating the Lopez conviction, Slater emphasised the per se nature of a wage-fixing violation, quoting Supreme Court Justice Brett Kavanaugh’s concurrence in National Collegiate Athletic Association v Alston for the proposition that ‘price-fixing labor is price-fixing labor’.[21]
Other district courts have similarly found that wage fixing can be a per se antitrust violation. For example, in United States v Jindal, Texas District Court Judge Amos Mazzant considered the defendants’ argument that their indictments violated the ‘fair warning requirement’ of due process because ‘no court has found that purported wage-fixing agreements constitute criminal conduct and neither the Supreme Court nor any Court of Appeals has held wage fixing to be per se unlawful’.[22] The court rejected the defendants’ ‘semantical argument’ that price fixing is per se illegal but wage fixing is not, holding, ‘[r]egardless of whether the Indictment characterizes Defendants’ conduct as wage fixing or price fixing, the Sherman Act, in conjunction with the decades of case law, made it “reasonably clear” that Defendants’ conduct was unlawful’.[23]
Even though the DOJ’s no-poach cases have been less successful, the agency’s repeated early-stage success in defeating motions to dismiss in those cases has helped clarify a potential question that was raised when it began filing its first criminal indictments in late 2020.[24] Can the DOJ prosecute no-poach agreements criminally in the absence of federal precedent by the courts, or is such a prosecution a ‘due process’ violation? Historically, per se treatment and criminal prosecutions under the Sherman Act have been limited to hardcore cartel conduct (ie, price fixing, market allocation and bid rigging) – virtually all other conduct is subject to the rule of reason standard. And, before 2016, there was no indication that the DOJ aimed to treat naked no-poach agreements criminally.
The due process defence was first raised by Surgical Care Affiliates (SCA), which argued that because there is no federal precedent that no-poach agreements are inherently illegal, ‘[f]undamental principles of due process and fair notice bar this prosecution’.[25] SCA asserted that the plain language of the Sherman Act does not provide the necessary notice because it ‘does not, in clear and categorical terms, precisely identify the conduct which it proscribes’.[26] It is, therefore, the courts, and not the antitrust agencies, that typically define per se illegal conduct, according to SCA, and the ‘government cannot just announce a per se prohibition on a new category of market practices’.[27]
In response, the DOJ argued that:
[T]he Supreme Court has long made clear that the Sherman Act applies equally to all industries and markets … [t]hus, agreements among buyers in a labor market not to solicit each other’s employees are treated no differently than agreements among sellers in a product market not to solicit each other’s customers.[28]
The DOJ also argued that the text of section 1 of the Sherman Act makes clear that violators may be charged criminally, and ‘judicial interpretations provide fair notice of the conduct that is prohibited’.[29]
Whether this fair notice argument would have prevailed in SCA will remain a mystery, given that in November 2023, before the court had ruled on SCA’s motion to dismiss, the DOJ voluntarily dismissed its indictment.[30] However, several of the DOJ’s other no-poach cases confronted the same due process argument, and in each case the district courts rejected it.
In United States v DaVita Inc, for instance, Colorado District Court Judge R Brooke Jackson ruled that naked horizontal nonsolicitation agreements that allocate the market (ie, those that are not ancillary to a legitimate procompetitive business purpose and have ‘no purpose except stifling competition’) are per se violations of the Sherman Act.[31] Judge Jackson found that naked no-poach agreements belong to an existing category of per se treatment – market allocation – because, as alleged, the defendants agreed to ‘allocate senior-level employees by not soliciting each other’s senior level employees’. These allegations, Judge Jackson ruled, made clear that ‘the agreement entered was a horizontal market allocation agreement carried out by nonsolicitation’.[32] As a result, Judge Jackson found that the defendants had ample notice that entering into a naked agreement to allocate the market of employees would subject them to criminal liability.[33]
In United States v Patel, Connecticut District Court Judge Victor Allen Bolden considered the defendants’ argument that they lacked constitutional notice that the alleged conduct was illegal because ‘judicial decisions had not recognized the alleged conduct as a per se violation of the Sherman Act’.[34] The court disagreed, noting that:
[H]orizontal market allocation agreements have long been held per se unreasonable … the per se rule has been constitutionally applied in prosecutions for decades … [a]lthough no poach agreements have rarely been prosecuted as a method of allocating the market, the fact that Defendants allegedly allocated the market in a novel way does not create a Due Process concern.[35]
While Judge Bolden denied the motion to dismiss, in his order granting acquittal, he wrote that, ‘[a]s a matter of law, this case does not involve a market allocation under the per se rule’.[36]
In United States v Manahe, Maine District Court Judge John Woodcock discussed the rulings in DaVita and Jindal, holding that, ‘because the horizontal restraints alleged in the indictment have long been held per se unreasonable, the Court rejects, consistent with the DaVita and Jindal Courts, [the defendant’s] vagueness and notice challenge’.[37]
Sole guilty plea sheds light on damages calculation
In the DOJ’s sole guilty plea, VDA OC, LLC (VDA) pleaded guilty to ‘knowingly entering into and engaging in a conspiracy to suppress and eliminate competition for the services of nurses by agreeing to allocate nurses and to fix the wages of those nurses’.[38] As alleged in the indictment, the agreement occurred over a relatively short nine-month time frame, beginning in October 2016.[39]
VDA was sentenced to pay a criminal fine of US$62,000 and restitution of US$72,000 to victim nurses.[40] Under the US Sentencing Guidelines, fines for certain antitrust offences are calculated in two steps: first, by determining the base fine, which is ‘20 per cent of the volume of affected commerce’,[41] and second, by determining the culpability score.[42]
Before this guilty plea, it was not known how the DOJ would determine the volume of affected commerce in these cases. In its sentencing memorandum, the DOJ set forth its calculation, requesting the court to calculate commerce based on the wages paid to the affected nurses during the relevant period. Using that methodology, the volume of commerce attributed to VDA was US$218,016 based on payroll receipts, resulting in a base fine of US$43,603 (20 per cent of US$218,016). Based on the culpability score, which considers various factors, such as the size of the organisation, the acceptance of responsibility and other multipliers, the recommended fine range was US$52,324 to US$104,647.[43]
The criminal fine of US$62,000 is at the lower end of the recommended range. This could be because VDA agreed to pay a relatively high amount of restitution – US$72,000, which is almost a third of the agreed volume of commerce and represents a much higher percentage than the settlement rates in prior no-poach civil cases.[44] This strategy could be modelled by future defendants, especially as a way to avoid potential follow-on litigation. The DOJ noted in its sentencing memo:
[T]he criminal fine is a just sentence because VDA has agreed to pay restitution to its employee nurses in the amount of US$72,000, which would potentially obviate the need for them to undertake the trouble and expense of bringing parallel civil suits to recover damages.[45]
DOJ and FTC confirm labour markets remain a priority
On 16 January 2025, four days before the end of the Biden administration, the FTC and DOJ jointly adopted the new 2025 guidelines. On the FTC side, both Republican FTC commissioners dissented from the adoption of the 2025 guidelines, criticising the FTC for pushing through an agenda for an outgoing administration that had ‘no future’.[46] However, Ferguson’s dissent statement (joined by Commissioner Melissa Holyoak) did not criticise the 2025 guidelines substantively – and even went so far as to note that Ferguson agreed that ‘[t]he antitrust laws protect employees from unlawful restraints of the labour markets, and guidance reflecting the Commission’s enforcement position on these issues promotes important transparency and predictability to market participants’.
Under the Trump administration, neither antitrust agency has rescinded or amended the 2025 guidelines, making them instructive moving forward.
Similar to the previous (and unanimously adopted) 2016 guidelines, the 2025 guidelines continue to state that the DOJ may criminally prosecute both wage-fixing and no-poach agreements, and remind the public that, ‘[e]ven if criminal charges are not pursued, these agreements may also be subject to civil liability’.[47] The 2025 guidelines also specifically call out no-poach agreements in the franchise context, highlighting that, ‘agreements … in which the franchisor and franchisee agree not to compete for workers’ or instances of a franchisor ‘organizing or enforcing a no-poach agreement among franchisees that compete for workers can be per se illegal’,[48] offering guidance on a hotly contested issue in private litigation.
Finally, the 2025 guidelines, like the previous 2016 version, caution against ‘[e]xchanging competitively sensitive compensation or other employment information with a competitor … when the information exchange has, or is likely to have, an anticompetitive effect’, and newly add that this holds true ‘whether or not that effect was intended’.[49] Exchanges of information regarding compensation, benefits or terms of employment between competitors or with a third party who shares that information with competitors can ‘implicate the existence of a wage-fixing conspiracy’.[50]
The 2025 guidelines also focus on exchanges of competitively sensitive information through algorithmic software and specifically take positions that have been raised by private litigants across the country. For example, the 2025 guidelines take the position that sharing competitively sensitive employment data with an algorithm that generates wage or benefit recommendations can be unlawful even if the exchange does not require businesses to strictly adhere to those recommendations’.[51]
Further, the guidelines remove the advice issued in the 2016 guidelines that information exchanges may be lawful if they are managed by a neutral third party and involve only anonymised, aggregated and historical data,[52] thus creating further uncertainty for private actors regarding the circumstances under which information exchanges are permitted.
After becoming chairman, in February 2025, Ferguson doubled down on efforts to enforce the antitrust laws in labour markets and directed the leaders of the FTC Bureaus of Competition, Consumer Protection and Economics, along with the Office of Policy Planning, to form a ‘Joint Labor Task Force’ to, among other things, ‘prioritize investigation and prosecution of deceptive, unfair, or anticompetitive labor market conduct’; ‘create an information-sharing protocol across the Bureaus to exchange best practices for uncovering’ such conduct; and ‘identify opportunities for advocacy on legislative or regulatory changes that would remove barriers to labour market participation, mobility, and competition’.[53]
The task force is to be ‘made up of at least three members from each Bureau and one member from the Office of Policy Planning’ and will ‘meet at least monthly to assess the status of all ongoing labour matters and shall report on the status of those matters to the Chairman on a quarterly basis’.[54] Ferguson’s directive explicitly notes that the FTC’s jurisdiction covers no-poach, nonsolicitation and no-hire agreements, wage-fixing agreements, noncompete agreements and even labour market monopsonies.[55]
Following this directive, Ferguson testified before Congress in May 2025 that the Joint Labor Task Force was his ‘first new competition priority’,[56] and specifically noted that the antitrust agencies should also evaluate whether mergers may impact competition in labour markets:
For too long, the antitrust agencies ignored the potential for mergers or other business arrangements to harm workers. Anticompetitive mergers and conduct can deprive individuals of opportunities to flourish, to make the most of their talent and to profit from their skills and hard work. Antitrust enforcers have an obligation to protect workers and support strong, competitive markets for their labour.[57]
At the same time, statements from the FTC also suggest that the FTC will focus less on rulemaking and more on individual enforcement actions moving forward. Although the Joint Labor Task Force’s directive includes a mandate to ‘identify opportunities for advocacy on legislative or regulatory changes,’ Ferguson has suggested that targeted enforcement is more preferable for competition than broader regulation:
Antitrust law has traditionally taken an ex post, rather than ex ante, approach to enforcement. If business conduct inflicts concrete harms on consumers or workers, and the enforcers can muster sufficient evidence of those harms, then the government acts to protect consumers and workers from that conduct. … No, the ex post approach will not catch every competition problem. But so long as enforcers are committed to vigorous and courageous enforcement, the precise, tailored ex post approach is preferable to the costly dragnet effect of ex ante regulation.[58]
On the DOJ side, following the DOJ’s win in the Lopez wage-fixing case, Slater stated in a press release that, ‘[w]age-fixing agreements are nakedly unlawful attempts at unjustly profiting off American workers’, and that the Lopez verdict, ‘highlights what should be a clear message with antitrust crimes: the agreement is the crime. The Antitrust Division will zealously prosecute those who seek to unjustly profit off their employees’.[59] Elsewhere, Slater described the Lopez case as a ‘great example’ of the current DOJ’s ‘America First’ approach to antitrust, in which the DOJ will continue to ‘defend ordinary Americans who need competition for their work to raise wages and improve working conditions’.[60]
Conclusion
Despite the change in administrations, the federal antitrust agencies continue to prioritise protecting the competitiveness of labour markets, through both criminal and civil enforcement actions. Companies should implement a robust antitrust compliance policy,[61] including antitrust training for employees, and engage antitrust counsel to review current nonsolicitation provisions and noncompete clauses to help mitigate their antitrust risk and to try to keep out of the antitrust agencies’ crosshairs. Companies should especially review their information exchange practices, including whether they supply competitive data to third-party trade associations or trade publications for industry ‘benchmarking’ purposes, and whether they use algorithmic software to generate pricing or output recommendations.
