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Employers Beware: COVID-19 Will Not Excuse Wage or Labor Fixing Agreements

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Employers Beware: COVID-19 Will Not Excuse Wage or Labor Fixing Agreements

The United States Department of Justice (DOJ) and the Federal Trade Commission (FTC) have made it clear that they will act to protect employees on the front lines of the battle against COVID-19. On the one hand, as we explained in a prior client alert, they previously announced pre-clearance procedures and other guidelines intended to make it easier for companies to collaborate in legitimate, pro-competitive ways. In their latest announcement, the DOJ and FTC warned that they would not hesitate to protect all employees from companies that use COVID-19 as an excuse to collude in fixing wages, benefits, hours worked, or other aspects of employment. Given the government’s prior focus on antitrust issues in the labor market, including their prior indication that they will pursue criminal remedies where appropriate, employers must be more careful than ever to ensure that they do not run afoul of antitrust laws in this area.

Even communicating with competitors or even trade groups about current or planned employee compensation or other employment policies—including adjustments in response to the COVID-19 crisis—can create antitrust risk. And companies should also understand that in the labor context, their competitors can include not only companies in their particular industry, but all companies that compete for similar types of employees.

For information about best practices to avoid antitrust risks in the labor market, antitrust compliance programs, or other services provided by Dykema’s Antitrust and Trade Regulation Group, please contact Howard Iwrey (hiwrey@dykema.com), Cale Johnson (cjohnson@dykema.com), or Cody Rockey (crockey@dykema.com).

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