Frequently Asked Questions

No-poach and wage-fixing agreements between competing employers can be criminal violations of the Sherman Act, and DOJ may criminally investigate and, where appropriate, bring felony charges against the participants, including both individuals and companies. The DOJ Antitrust Division and the Federal Trade Commission explain this in their January 2025 Antitrust Guidelines for Business Activities Affecting Workers, which replaced their 2016 guidance for human resource professionals. The guidelines state that they have no force or effect of law. They explain how the agencies identify and assess business practices that affect workers.

No-poach agreements. Under the guidelines, companies that compete to hire or keep workers are competitors in the labor market even if they make different products or offer different services. An agreement between them not to hire or not to solicit each other's employees is a no-poach agreement. A "no cold call" agreement counts as a no-solicit agreement.

Wage-fixing agreements. Agreeing on pay or other terms of employment, including a pay range, a ceiling or a benchmark, is wage fixing. The agreement can be informal or unwritten. According to the guidelines, when formed between competing or potentially competing employers, directly or through an intermediary, these agreements are illegal even if they did not result in actual harm such as lower wages.

Franchises and information sharing. No-poach clauses between a franchisor and franchisees, or among franchisees, are also subject to antitrust scrutiny and may violate the antitrust laws. Exchanging competitively sensitive information about pay or benefits with competitors may be illegal, including when the exchange runs through a third party or intermediary using an algorithm.

Other restrictions. The guidelines add that non-compete agreements, training repayment agreement provisions and overly broad nondisclosure agreements may also violate the antitrust laws when they restrict worker mobility.

Reporting. Information about a possible violation can be reported to the Antitrust Division's complaint center or to the FTC. The Division lists 202-307-2040 and 888-647-3258.

Recent enforcement. Recent Antitrust Division enforcement is covered in the news posts on the egg producer price conspiracy case and the Agri Stats settlement.

Penalties for these violations are covered in the FAQ on Sherman Act criminal penalties.

A Sherman Act violation is a felony punishable by a fine of up to $100,000,000 for a corporation, a fine of up to $1,000,000 for any other person, imprisonment of up to 10 years, or both, at the discretion of the court (15 U.S.C. 1). The same penalties apply to monopolizing, attempting to monopolize or conspiring to monopolize trade or commerce (15 U.S.C. 2). When the offense produces pecuniary gain or causes pecuniary loss to a person other than the defendant, the defendant may instead be fined up to the greater of twice the gross gain or twice the gross loss, unless that would unduly complicate or prolong sentencing (18 U.S.C. 3571(d)). That alternative fine can exceed the Sherman Act caps.

What Section 1 covers. Section 1 makes illegal any contract, combination or conspiracy in restraint of trade or commerce among the states or with foreign nations. The DOJ and FTC guidelines on business activities affecting workers apply the same rule to labor markets, so wage-fixing and no-poach agreements between competing employers can be prosecuted as Section 1 felonies.

Who can be charged. Both the company and the individuals who took part can be charged. The individual fine cap applies to each person, and prison terms apply to individuals.

Monopolization. Section 2 reaches a person who monopolizes, or attempts or conspires to monopolize, any part of interstate or foreign trade. The corporate and individual penalty caps are the same as under Section 1.

Civil enforcement. Separate from criminal penalties, the Justice Department and states also bring civil cases that end in settlements or court orders. The news posts on the RealPage rental pricing settlement with Willow Bridge and the hot mix asphalt merger challenge in Tennessee describe recent civil actions.

The FAQ on no-poach and wage-fixing agreements explains how these rules apply to hiring, and the FAQ on antitrust whistleblower protection covers employees who report violations.

Federal law prohibits an employer from discharging, demoting, suspending, threatening, harassing or otherwise discriminating against a covered individual who reports a criminal antitrust violation to the federal government or to a supervisor, or who assists a federal investigation or proceeding about it (15 U.S.C. 7a-3(a)). The protection comes from the Criminal Antitrust Anti-Retaliation Act, added in 2020.

Who is covered. A covered individual is an employee, contractor, subcontractor or agent of an employer (15 U.S.C. 7a-3(a)(3)(B)).

What is protected. The protected activity is providing information about a violation, or conduct the individual reasonably believes is a violation, of Section 1 or Section 3 of the Sherman Act, or a violation of another criminal law committed together with a Sherman Act violation, or assisting in an investigation or proceeding. The DOJ and FTC guidelines on business activities affecting workers note that this covers workers who report criminal wage-fixing or no-poach conduct.

Limits. The protection does not apply to a covered individual who planned and initiated a violation or attempted violation of the antitrust laws, a violation or attempted violation of another criminal law in conjunction with an antitrust violation, or an obstruction or attempted obstruction of a Justice Department investigation (15 U.S.C. 7a-3(a)(2)(A) to (C)). Only criminal violations count, not purely civil ones (15 U.S.C. 7a-3(a)(4)).

How to seek relief. A complaint must be filed with the Secretary of Labor within 180 days after the violation (15 U.S.C. 7a-3(b)(2)(D)). If the Secretary has not issued a final decision within 180 days of filing, and the delay is not due to the claimant's bad faith, the individual may bring an action for de novo review in federal district court.

Remedies. A prevailing individual is entitled to relief that makes the individual whole, including reinstatement with the same seniority, back pay with interest, and special damages such as litigation costs, expert witness fees and reasonable attorney's fees (15 U.S.C. 7a-3(c)). Other rights under federal or state law or a collective bargaining agreement are not reduced.

Related topics. The FAQ on what compliance training is describes employer compliance training, and the FAQ on Sherman Act criminal penalties lists the penalties for the underlying violations.