Are no-poach agreements legal? Antitrust law for recruiters and employers

No-poach agreements between companies that compete for workers are generally illegal: an agreement not to recruit, solicit or hire each other's employees, or to fix wages, can violate Section 1 of the Sherman Act and be prosecuted as a felony. The DOJ and FTC's Antitrust Guidelines for Business Activities Affecting Workers, issued January 16, 2025, say so and, as of October 2026, have not been withdrawn. In April 2025 the DOJ won its first wage-fixing conviction, against a Las Vegas nurse staffing executive. Not every no-hire clause is a crime: a narrow restraint that is part of a legitimate collaboration is judged on its effects, though the FTC has ordered service contractors to drop clauses that stop customers hiring their workers.

This page covers antitrust law. Whether a contract clause is enforceable between the parties is a separate question, covered in non-solicitation clauses for recruiters; for employee non-competes, see the state pages such as California.

Are the 2025 DOJ/FTC worker guidelines still in effect?

Yes, as of October 2026, with a caveat. The DOJ Antitrust Division and the FTC issued the Antitrust Guidelines for Business Activities Affecting Workers on January 16, 2025, replacing their 2016 guidance for HR professionals. When we checked in October 2026, the guidelines were still listed on the DOJ Antitrust Division's guidelines page and in the FTC's legal library, with no withdrawal notice on either.

The caveats: the guidelines say they have "no force or effect of law," and the FTC vote was 3-2, with Commissioners Andrew Ferguson and Melissa Holyoak dissenting. Read them as the agencies' published view rather than settled policy. On the core point there is no disagreement. As chairman, Ferguson signed a February 26, 2025 memo creating a Joint Labor Task Force. The memo lists "no-poach, non-solicitation, or no-hire agreements" as conduct courts have found "can be so pernicious as to be a per se violation" and calls wage-fixing agreements "a hardcore violation of the competition laws subject to the per se standard."

What does the law say?

Section 1 of the Sherman Act declares illegal "every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce." Each violation is a felony, punishable "by fine not exceeding $100,000,000 if a corporation, or, if any other person, $1,000,000, or by imprisonment not exceeding 10 years" (15 U.S.C. 1). Some agreements, such as naked price-fixing or market allocation among competitors, are illegal "per se," without any inquiry into their effects; others are judged under the rule of reason, which weighs harm against benefits.

The 2025 guidelines apply that to hiring:

• "Agreements between companies not to recruit, solicit, or hire workers, or to fix wages or terms of employment, may violate the antitrust laws and may expose companies and executives to criminal liability."
• A no-poach agreement includes "an agreement to request permission from the other company before trying to hire an employee."
• Agreements "can be formal or informal; express or implicit; and need not be written down or talked about at all," and are illegal "even if they are never carried out."
• Agreeing "to a range, ceiling, or benchmark for calculating wages" is wage-fixing even without a specific number.
• Exchanging competitively sensitive pay information with competitors, including through a third party or an algorithm, may be unlawful.

The guidelines distinguish these from an employer's own contract with its workers: a no-poach agreement between competitors is "different than, for example, agreements between an employer and its workers that prevent the workers from soliciting clients or vendors" at a future job. Those clauses are analyzed separately and can still raise issues.

Has anyone been convicted?

Yes. On April 14, 2025, a federal jury convicted Eduardo "Eddie" Lopez of Las Vegas of conspiring to fix the wages of home healthcare nurses from March 2016 to May 2019, and of wire fraud for hiding the antitrust investigation from the buyer of his staffing company (DOJ, April 2025). On November 21, 2025, he was sentenced to 40 months in prison, $550,000 in criminal fines, restitution and forfeiture of $10,459,000; the DOJ called it "the Justice Department's first ever wage-fixing conviction" (DOJ, November 2025). The case involved a staffing company and nurse pay, which is exactly the market many agency recruiters work in.

Is a staffing client's no-hire clause the same as a no-poach agreement?

Not necessarily. The structure of the agreement matters more than its label.

In Aya v. AMN, decided August 19, 2021, two travel-nurse staffing agencies had a subcontracting deal under which Aya filled AMN's overflow assignments and agreed not to solicit AMN's travel nurses. The Ninth Circuit held the clause was ancillary to that collaboration rather than naked, applied the rule of reason and affirmed judgment for AMN. The 2025 guidelines cite the case for the same point.

The FTC has taken a harder line on customer no-hire clauses. In February 2025 it approved, 4-0, a final order requiring building service contractor Planned Building Services to stop enforcing no-hire agreements that "barred residential and commercial building owners from hiring Planned's building service workers," which the FTC said "limited workers' ability to negotiate for higher wages, better benefits, and improved working conditions" (FTC). On February 12, 2026, it finalized a similar order against Adamas Amenity Services, whose clauses stopped building owners hiring its workers "without facing a significant penalty" (FTC).

These are consent orders against building services firms, not court rulings about staffing agencies, and the FTC has not said what conversion fee, if any, is acceptable. But a staffing agreement that forbids a client from hiring an agency's temporary workers has the same structure. Practical steps for agencies:

• Prefer a conversion or placement fee for direct hire over a flat ban.
• Keep any restriction short, tied to the assignment, and limited to workers actually placed with that client.
• Never agree with another agency or a client to stop recruiting from each other generally; that is the naked agreement the agencies prosecute.
• Do not share pay rates, bill rates or raise plans with competing agencies, directly or through a survey vendor that passes them on.

What about franchises and state law?

The guidelines say no-poach clauses "are subject to antitrust scrutiny even if they are between a franchisor and a franchisee" or among franchisees of the same franchisor. Some states legislate directly. Washington provides that "no franchisor may restrict, restrain, or prohibit in any way a franchisee from soliciting or hiring" employees of another franchisee of the same franchisor, or of the franchisor (RCW 49.62.060). State antitrust and employment laws can reach further than federal law; see Washington's non-compete rules for the rest of that chapter.

What should recruiters and HR teams do?

• Watch informal talk. "We don't poach from them" between executives, or a recruiter told to skip a partner company's staff, can be the agreement.
• Separate competitor intelligence from coordination. Public job ads and candidates' own information are fine; agreed pay ranges and shared salary plans are not. See how to set salary ranges for building bands from your own data.
• Review client and partner contracts. Find every no-hire, no-solicit and right-of-first-refusal clause and check it is tied to a real collaboration and no broader than needed.
• Know the whistleblower route. The Criminal Antitrust Anti-Retaliation Act protects employees, contractors and agents who report antitrust crimes, including no-poach and wage-fixing agreements, according to the guidelines.
• Check joint-employer exposure where an agency and client share control of workers; see joint employer liability.