Antitrust

On February 26, 2025, Federal Trade Commission (FTC) Chairman Andrew Ferguson announced a Directive Regarding Labor Markets Task Force (Directive) to create a task force to investigate and prosecute activity that harms workers in violation of the antitrust or consumer protection laws. As one of the first actions by the Trump FTC, Chairman Ferguson’s Directive signals that labor market conduct will continue to be an area of focus at the FTC.

During the Biden administration, then-FTC Commissioner Ferguson and fellow Republican Commissioner Melissa Holyoak dissented from policy statements targeting harms against workers based on process grounds. While some interpreted the dissents as a signal that labor effects would not be a priority under a Republican-led FTC, close observers predicted that the Trump administration would continue to pursue labor harms. The FTC press release announcing the Directive explains that “[a] healthy labor market is critical to the country’s success.”

Reflecting the FTC’s “dual mandate to protect the American people” from “unfair or deceptive practices” and “unfair methods of competition,” the Directive reaffirms the FTC’s authority to protect workers as well as consumers. The Directive identifies twelve examples of conduct that fall under the FTC’s jurisdiction, some of which reflect a continued focus from the Biden administration on labor market antitrust enforcement. For instance, in some areas, the Directive aligns with potential worker harms identified in the Antitrust Guidelines for Business Activities Affecting Workers (2025 Worker Guidelines), issued by the Department of Justice (DOJ) and FTC four days before the Trump administration took office.

Chairman Ferguson’s Directive signals the potential for continued, and even increased, FTC investigation and enforcement actions against employers for certain business practices affecting workers. The issuance of the Directive and the 2025 Worker Guidelines present employers with the opportunity to review current employment and compensation policies and agreements to ensure compliance with the antitrust laws.

The Biden Era’s Focus on Labor Harms

The 2025 Worker Guidelines, which replaced the 2016 Antitrust Guidance for Human Resource Professionals, (2016 Guidance), identifies the following non-exhaustive list of potentially problematic practices that the DOJ and FTC Biden antitrust enforcers had committed to pursue:

• Wage-Fixing and No-Poach Agreements. Business competitors that enter into agreements “not to recruit, solicit, or hire workers or to fix wages or terms of employment” may violate the antitrust laws, and such behavior can lead to criminal charges. Moreover, these agreements are illegal “whether entered into directly or through an intermediary” and “even if they did not result in actual harm such as lower wages.”
• Franchise No-Poach Agreements. Agreements in which a franchisor and franchisee agree not to compete for workers can be per se illegal. A franchisor may also violate the antitrust laws by “organizing or enforcing a no-poach agreement among franchisees that compete for workers.”
• Sharing of Competitively Sensitive Information. Sharing competitively sensitive information may be unlawful “when the information exchange has, or is likely to have, an anticompetitive effect,” regardless of whether that effect was intended. Notably, the 2025 Worker Guidelines explicitly cover information sharing that is facilitated by an algorithm or third-party tool or product. Such third-party exchanges that “generate wage or other benefit recommendations” may be unlawful even when “the exchange does not require businesses to strictly adhere to those recommendations,” the co-conspirators “retain some discretion,” or the co-conspirators “cheat on the agreement.”
• Non-Compete Clauses. The 2025 Worker Guidelines retain the spirit of the FTC’s April 2024 final rule banning most non-compete agreements, which was scheduled to take effect in September 2024 but was blocked by an order from the District Court for the Northern District of Texas and is currently on appeal. 
• False Earning Claims. The 2025 Worker Guidelines specify that the antitrust enforcers can pursue businesses that make false or misleading claims about potential earnings that employees or independent contractors may realize. Such false earnings promises may make it harder for other businesses to fairly compete for workers and violate Section 5(a) of the FTC Act, which prohibits “unfair or deceptive acts or practices in or affecting commerce.”
• Independent Contractor Harms Are Considered Labor Harms. In contrast to the 2016 Guidance, which presumptively applied only to traditional employees, the 2025 Worker Guidelines clarify that the antitrust laws protect “both employees and independent contractors” against labor harms.
• Other Restrictive Conditions That Harm Competition. In addition to the above-listed behaviors, the guidelines also include a catch-all provision, allowing the antitrust enforcers to “investigate and take action against other restrictive agreements that impede worker mobility or otherwise undermine competition.” These behaviors include, but are not limited to, non-disclosure agreements, training repayment agreement provisions, non-solicitation agreements, and exit fee and liquidated damages provisions. Importantly, these examples have not historically been considered antitrust violations. 

Given the eleventh-hour release of the 2025 Worker Guidelines, then-Commissioner Ferguson dissented to their issuance, though he did not comment on their substance. For now, the 2025 Worker Guidelines remain in effect and can inform how antitrust enforcers are likely to respond to harm to workers. 

The Trump FTC Expands the Focus on Labor Harms

While the 2025 Worker Guidelines were drafted to specifically address antitrust labor harms, Chairman Ferguson’s Directive embraces a combined antitrust and consumer protection enforcement vision towards labor harms. The Directive accepts many examples from the 2025 Worker Guidelines as labor harms—e.g., (1) no-poach, non-solicitation, or no-hire agreements; (2) wage-fixing agreements; (3) noncompete agreements; (4) labor-contract termination penalties; (5) harming gig economy workers; and (6) deceptive job advertising—and expands the list to cover additional conduct the FTC will target for scrutiny. These include:

• Labor market monopsonies. Where businesses use anticompetitive methods to acquire or to maintain market power in the market for employing workers.

• Collusion or unlawful coordination on DEI metrics. The Directive notes this may have the effect of diminishing labor competition by excluding certain workers or students from employment or educational opportunities.

• Deceptive business opportunities. Using false or misleading representations about the value and potential earnings of a business to lure in potential buyers of the business.

• Misleading franchise offerings. Inducing workers or potential employers to invest in franchise opportunities that do not deliver anticipated benefits.

• Harmful occupational licensing requirements. “Needless” occupational licensing requirements can erect unnecessary barriers to entry and impede labor mobility.

• Job scams. Fraudulent job placement schemes that trick job seekers into paying money that they cannot recover.

Even if not explicitly included in the 2025 Worker Guidelines, many of these examples are consistent with the priorities of the Biden FTC. One notable difference is the Directive’s inclusion of “collusion or unlawful coordination on DEI metrics reflects.” As the Trump administration continues to scrutinize DEI initiatives more broadly, the Directive suggests that the FTC may be called on to investigate and prosecute DEI-related business practices on competition grounds.

The Future of Antitrust Enforcement against Labor Harms

While the Directive is specific to FTC enforcement, there is reason to believe that the DOJ will also continue to take an aggressive position on labor antitrust issues. In her Senate confirmation hearing to become Assistant Attorney General for Antitrust, nominee Gail Slater briefly addressed noncompete agreements as a growing practice of “concern” because they “prevent[] workers from switching jobs easily” and tend to be “prevalent in markets that are highly concentrated.”

As we reported in our previous post, while the U.S. agencies have been leading the way, increased scrutiny of alleged anticompetitive practices within labor markets has become a global trend, especially in Europe, with a particular focus on no-poach agreements. Such agreements have attracted attention from competition authorities in several EU Member States, across a range of industries, including in Belgium, Denmark, France, Finland, Hungary, Lithuania, Portugal, Romania, Slovakia and Spain. The European Commission and UK’s Competition and Markets Authority (CMA) also have ongoing investigations into no-poach agreements and the CMA has issued guidance for employers on the types of anticompetitive agreements and behaviors they should avoid in labor markets.

Increased antitrust scrutiny of labor market practices appears to be a trend that is likely to continue around the globe. Comprehensive antitrust counseling should account for the risk of investigation or transaction delays resulting from labor effects of a proposed transaction. Employers should review their policies in light of FTC/DOJ guidance and CMA guidance, and ask antitrust counsel for consultation on practices that could result in labor harms.