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NLRB, DOJ, FTC and DOL Formalize the Exchange of Information to Help Scrutinize The Impact of Mergers on Workers
Sep 3, 2024

NLRB, DOJ, FTC and DOL Formalize the Exchange of Information to Help Scrutinize The Impact of Mergers on Workers

Topics: Business Transactions and Restructurings, Personnel Policies and Procedures

The MOU

On August 28, 2024, the National Labor Relations Board and Department of Labor (“Labor Agencies”) entered into a Memorandum of Understanding with the Department of Justice – Antitrust Division and the Federal Trade Commission (the “Antitrust Agencies”) that formalizes the commitment of Labor Agencies to support Antitrust Agencies’ review of mergers (“MOU”). The MOU requires that the Labor Agencies: (i) train Antitrust Agency personnel on issues that fall within the Labor Agencies jurisdiction, including the duty to bargain in good faith, successor bargaining obligations, and unfair labor practices; (ii) meet bi-annually with the Antitrust Agencies to discuss implementing and coordinating the MOU obligations; (iii) and continue to uphold and expand upon prior agreements between Labor Agencies and Antitrust Agencies.

Why This MOU Matters

The Biden Administration has repeatedly held to a goal of interagency prosecutorial cooperation, and this MOU builds upon previous interagency agreements that aim to enhance Antitrust Agency scrutiny of mergers. The collaboration aims to identify and address potential anti-competitive impact on workers and the MOU bolsters already existing memoranda of understanding that permit the Antitrust Agencies to contact the Labor Agencies to schedule consultations to discuss information sharing as well as to seek technical assistance on labor and employment law issues in merger review, including in the resolution of labor market merger investigations. This MOU furthers the Labor Agencies’ commitment to work together to ensure all relevant and appropriate information and expertise can be used to assess the potential impacts of mergers and acquisitions on labor markets.

The bottom line, from our perspective, is that employers should anticipate an uptick in the extent of scrutiny and potentially litigation, surrounding mergers. While we often think of antitrust concerns through the lens of how a merger may affect consumers, the Biden Administration hailed in an era of worker and labor support and a “whole of government” approach to not only promoting unions but also watchdog activity to ensure competition in the marketplace for workers to seek jobs, negotiate fair wages, and secure safe and fair working conditions. Here that means that in addition to upstream and downstream competitive effects on consumers and businesses in a merger, the Antitrust Agencies are also focused on how a merger affects the competitive dynamics for workers and their ability to meaningfully seek employment where they wish to, and negotiate for fair wages and working conditions.

The formalized support between the Labor Agencies and Antitrust Agencies could translate into increased independent or coordinated agency enforcement efforts and merger reviews. Businesses contemplating a merger should evaluate the potential impact the transaction could have on competition in the job market and prepare accordingly for potential review or litigation of these issues.

 

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For over 25 years, CDF has distinguished itself as one of the top employment, labor and immigration firms in California, representing employers in single-plaintiff and class action lawsuits and advising employers on related legal compliance and risk avoidance. We cover the state, with five locations from Sacramento to San Diego.

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About the Editor in Chief

Sacramento Office Managing Partner and Chair of CDF’s Traditional Labor Law Practice Group. Mark has been practicing labor and employment law in California for thirty years. His practice has a special emphasis on the representation of California employers in union-management relations and handling federal and state court litigation and administrative matters triggered by all types of employment-related disputes. He is also adept at providing creative and practical legal advice to help minimize the risks inherent in employing workers in California. He recently named “Sacramento Lawyer of the Year” in Employment Law-Management for 2021 by Best Lawyers®.
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