The U.S. Department of Justice (“DOJ”) under the President Biden Administration is shifting the focus of the enforcement of the U.S. Antitrust Laws from the protection of consumers to protecting workers. The following case is an example of this shift. We shall be updating the reader on additional updates to U.S. Antitrust/Competition Law that we believe may be useful and interesting for our readers. If you are interested in a discussion of proposed amendments to NY Antitrust Laws please see: Proposed Amendments to New York Antitrust Laws.
A former employee of a CT-based defense/aerospace company, is alleged by the DOJ to have been the ringleader in a conspiracy to reduce competition for hiring engineers, thus, depressing wages in the market for engineers.
The former employee is alleged to have been the ringleader in obtaining the agreement of numerous aerospace services companies to not hire engineers that worked at another’s company. He is alleged to have chastised those that violated this agreement and actively contacted the other companies to compel compliance.
The U.S. Justice Department noted that this type of “no poaching” action stifles wages and, thus, reduces labor costs for these employers. A conviction of this charge under the Sherman Antitrust Act can lead to ten years in prison and a fine up to US$ 1 million.
The Antitrust Division of the DOJ is quoted as noting that:
“The Antitrust Division, together with our law enforcement partners, have prioritized rooting out conspiracies in labor markets . . ..We will vigorously prosecute this and other cases in which corporate executives undermine the careers of their own workers in order to reap undeserved profits and deprive our fellow citizens of opportunities to earn a competitive wage.”
The case is being heard in a Hartford, Connecticut Federal Court. We shall update the reader when more is known.
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