No-Poach Agreements, Restrictive Covenants, and the Ancillary Restraints Doctrine

Understand the types of agreements that may cause a problem and the best practices for avoiding unlawful conduct.

Agreements affecting hiring practices, particularly among competitors, are relatively common, and have been in existence for quite some time. Despite the prevalence of such agreements, however, their legality has frequently come into question. Depending on the facts, certain agreements affecting hiring practices may be deemed reasonable, and, therefore, lawful. On the other hand, there are situations where these same agreements may be deemed unlawful, and in certain circumstances unlawful per se resulting in potential significant consequences under the antitrust laws. As early as 2016, through the issuance of the Antitrust Guidance for Human Resource Professionals, the antitrust enforcement agencies announced their intention to focus on protecting competition in labor markets, and to criminally prosecute, when determined to be appropriate, parties that engage in such practices. As labor markets continue to tighten, enforcement, including criminal prosecutions of unlawful conduct, has increased. This topic will discuss the types of agreements that may cause a problem, antitrust laws implicated by such agreements, and recent enforcement and protocols and best practices for avoiding unlawful conduct.