On April 3, 2018, the Cartel Service filed a cartel and abuse of dominance action against Knorr-Bremse AG and Westinghouse Air Brake Technologies Corporation (« Wabtec »), at the same time as it filed a civil transaction. The complaint accuses these companies and a third-party company, Faiveley, of having already entered into in 2009, in violation of Section 1 of the Sherman Act, no-poach nus agreements, which began as early as 2009 and last until at least 2015. In October 2016, the Cartel Department and the FTC jointly published Antitrust Guidance for Human Resource Professionals. The agencies have made clear their intention to sue companies or individuals who do not have poaching agreements: « [D] there are no penalties for employers agreeing among themselves on whether or not employees should be compensated to request or hire each other`s staff. » (Added highlight) « No agreement, according to the facts, can be pursued. » Instead, the employer may include a non-compete clause in the employment contract. While non-competition obligations can also carry baggage over cartels and abuse of dominance and are governed by statutes and jurisprudence that protect the free movement of workers, they offer direct competitors the « front line » of the defence against the loss of trade secrets. National laws differ in the area of « reflection » on non-competition, but first acceptance and retention of employment is generally sufficient. An employer may consider stricter non-competition obligations for high-level workers or those who work directly with important trade secrets, but further reflection is needed. In general, an increase in wages with a promotion would provide the necessary support for a more demanding non-competition clause. Employee non-acquisition agreements may also occur in supply contracts, distribution agreements, joint development agreements, enterprise research agreements and other service relationships with independent contractors. The common thread of these relationships is the familiarity that the parties develop with each other`s collaborators, whether through the exchange of information, direct interaction or otherwise, and each party tries to prevent this familiarity from reinforcing the efforts of the other party to recruit the party`s collaborators. For example, a company may enter into an agreement with a marketing company to promote the company`s products. The service agreement may include an agreement from the company not to ask the employees of the marketing company to prevent the company from providing the services using the former employees of the marketing company.
These agreements often apply both for the duration of the relationship and for a specified period after the relationship has been insanity. But franchise systems are not the only destinations. On April 3, 2018, Deputy Attorney General Makan Delrahim of the Cartels and Agreements Division said the complaint was part of a broader investigation by the no-solicit or no-poach agreements division.