Unlawful Agreements to Suppress Wages

In an increasing trend, employers are reaching agreements with their competitors to suppress the wages of their employees.  These agreements can take many forms, such as “no-poach” or no-solicit agreements, or agreements to cap the wages in certain common job classifications.  Such agreements can violate the federal antitrust laws as well as state unfair competition laws and other state statutory schemes.

Recently, the U.S. Department of Justice prosecuted Apple, Adobe Systems, Google, Intel, Intuit and Pixar for illegally agreeing to not “cold-call” their competitors’ employees regarding employment opportunities.  www.justice.gov/atr/cases/f262600/262654.htm.  A civil action containing many similar allegations was filed on behalf of a class of workers against Apple, Adobe Systems, Google, Intel, Intuit, Lucasfilm and Pixar.  On May 16, 2014, the court approved the class’s settlements with Lucasfilm, Pixar and Intuit in the total amount of $20 million.  Apple, Google, Intel and Adobe subsequently agreed to settle the case with the class for a combined $324.5 million. 

Allegations of unlawful agreements in the highly-competitive technology sector appear to be growing, but they are not confined to that industry alone.  On July 9, 2014, the U.S. Federal Trade Commission settled two charges against ski equipment manufacturers who agreed not to compete for one another’s ski endorsers and employees.  www.ftc.gov/news-events/press-releases/2014/05/ski-manufacturers-marker-volkl-tecnica-settle-ftc-collusion.  

CPM has skilled attorneys who practice in both the employment and antitrust fields.  If you are an employee or group of employees who believe your wages have been artificially suppressed by agreements not to compete, contact CPM attorney Adam Zapala at (650) 697-6000. 

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