Labor

Jonathan Masur and Eric Posner argue that the Federal Trade Commissions’ recent ban on noncompete clauses is lawful under the plain language of the Federal Trade Commission Act, longstanding court precedent, and well-established administrative law principles.

On March 13, the Ultimate Fighting Championship settled several lawsuits, including Cung Le v. Zuffa, which was scheduled to go to trial in April. The plaintiffs in Cung Le had accused the mixed martial arts organization of several anticompetitive behaviors that led to the suppression of fighter wages. Stephen F. Ross and Gurtej Grewal recount the facts of the case and what the settlement might mean for the industry.

Dylan Gyauch-Lewis writes that efforts by big businesses, including SpaceX, Amazon, and Trader Joe’s, to undermine the National Labor Relations Board rests on poor interpretations of the Constitution but would devastate the American government and economy if successful. 

Similar to noncompete clauses in employment contracts, training repayment agreements, which require employees to pay back their employers for firm-sponsored training if they quit early, can impede worker mobility and reduce competition in labor markets. The authors document the pervasiveness and characteristics of these provisions and suggest directions for future research.

Nearly one in five American workers are affected by noncompete agreements, which prevent workers from working for or creating a rival firm. In new research, Axel Gottfries and Gregor Jarosch estimate that the Federal Trade Commission’s proposed noncompete ban could raise wages by 4%.

Competition authorities and analysts are increasingly focused on the impact of mergers and acquisitions on worker welfare. Using a novel dataset on Canadian firms and workers, David Arnold, Kevin Milligan, Terry S. Moon and Amirhossein Tavakoli test the empirical validity of several theories on how M&A may help or harm workers.

Critics of the Federal Trade Commission’s lawsuit last week to block the Kroger-Albertsons merger claim that the agency incorrectly limits the relevant buyer-side market to unionized grocery workers. Steve C. Salop argues that the critics are wrong, and that standard antitrust analysis shows the FTC has it right.

Although the antimonopoly neo-Brandeisians and the labor movement share many goals, including a desire to reduce the power of big business, significant tensions exist, such as labor’s past support for mergers when they advance the ability of workers to unionize. Kate Andrias traces the history of labor’s relation with antitrust to show that, despite historical and contemporary tensions, there have also been deep connections between the two movements that show how they can better complement each other in the future.

Noncompete agreements, which impose contractual limits on an employee’s ability to work after leaving a job, are regulated or banned in all states. But employers can potentially get around legal limitations on noncompetes by asking workers to sign confidentiality agreements that have similar functional effects. In a new article, Camilla A. Hrdy and Christopher B. Seaman provide empirical evidence that a significant number of employment agreements contain broad confidentiality provisions that place noncompete-like restrictions on workers.

Excerpted from THE INFLUENCER INDUSTRY: The Quest for Authenticity on Social Media © 2023 by Emily Hund. Reprinted by permission of Princeton University Press.