On February 24, 2025, Federal Trade Commission (“FTC”) Chairman Andrew Ferguson announced the creation of a new labor task force. The task force calls for the FTC’s Bureau of Competition, Bureau of Consumer Protection, and Bureau of Economics to coordinate to investigate corporate labor practices that affect consumers.
In announcing the task force, Chairman Ferguson declared that labor “is going to be one of the top priorities of the Trump-Vance FTC.” He emphasized his plans to “take incredibly seriously the fact that the antitrust laws protect competition in labor markets.” To that end, the task force will be charged with investigating anticompetitive non-compete, no-hire, and no-poach agreements, as well as other potentially anticompetitive or anti-consumer practices that impact workers.
The Biden-Harris FTC also made labor a significant focus of its enforcement efforts, including issuing a rule prohibiting almost all employer/employee non-compete agreements, alleging harm to labor markets as a result of the (now-abandoned) Kroger-Albertsons merger, and partnering with other administrative agencies to investigate competition in labor markets. The agency also brought actions against companies for misleading workers, including gig economy workers, about how much money they would make. Although the Trump-Vance FTC’s approach may differ from that of the Biden-Harris FTC, Chairman Ferguson’s announcement makes clear that the FTC will continue to focus on labor markets utilizing both its antitrust and consumer protection authority.
Same focus, different approach?
This task force signals an apparent alignment with the Biden-Harris FTC’s focus on anticompetitive labor practices in conduct and merger investigations. However, Chairman Ferguson’s statements suggest that, at least in some respects, he plans to take the agency in a different direction when it comes to enforcement.
For instance, the FTC issued its Final Rule prohibiting almost all non-compete agreements in April 2024. Chairman Ferguson dissented from the issuance of the rule, stating that it is unconstitutional because the FTC lacked authority under the FTC Act and because the Rule violated the Administrative Procedure Act’s requirement of “reasoned decision-making.” In announcing the task force, he reiterated his view that the blanket rule is unconstitutional but made sure to note that the agency will “be on the lookout” for anticompetitive non-compete agreements to be challenged on a case-by-case basis. In his Senate confirmation hearing on February 25, 2025, President Trump’s nominee to fill the vacant fifth Commission seat, Mark Meador, appeared to agree with the Chairman. He articulated concerns that employers have “overused and abused” non-compete agreements and noted that the FTC should address this issue through enforcement actions rather than rulemaking.
Regarding merger review, Chairman Ferguson announced on February 18, 2025, that the FTC and Department of Justice’s (“DOJ’s”) Joint 2023 Merger Guidelines, passed by the Biden-Harris FTC and which specifically include a labor-market theory of harm, will remain in effect. However, Chairman Ferguson has also praised the exclusion of a “Labor Markets” section from the new HSR Act filing form and rules, which would have required merging parties to provide detailed information about labor markets when notifying the FTC and DOJ of their mergers. Chairman Ferguson emphasized that “the abandonment of the proposed Labor Markets section” was the “most important climbdown” from the initial proposed rulemaking, noting the significant burden on merging parties.
It remains to be seen how the Trump-Vance FTC will direct other labor-related policies. Just days before the Inauguration, the FTC and DOJ issued new guidelines outlining how the agencies will assess whether business practices affecting workers violate the antitrust laws. The agency also issued three proposed rulemakings that would add agency tools to address deceptive earning claims. Additionally, just two days prior, the FTC issued a policy statement on the FTC’s view that gig workers are “shielded from antitrust liability when engaging in protected bargaining and organizing activities.” And Chairman Ferguson and Commissioner Melissa Holyoak, the two Republican commissioners, dissented to the issuance of the guidelines, proposed rules, and the policy statement. However, their dissents were limited to the timing of these guidelines – on the eve of the transition to a new Administration with different policy priorities – and they declined to opine on the substance of the guidance. Observers will have to wait at least until there is a Republican majority on the Commission to see if the guidance is withdrawn.
Coordination between Bureaus
Although the focus on labor markets is likely to be grounded in the FTC’s competition mission, Chairman Ferguson believes the agency’s consumer protection mission is relevant as well. He called on the Bureaus of Competition, Consumer Protection, and Economics to coordinate on this mandate. In particular, he noted that the FTC would investigate training and professional schools “where you pay a lot of money to get into a professional school and you don’t really get a license at the end of it” as well as violations of the Business Opportunity Rule which protects consumers engaging in the purchase of a business from deception.
Key takeaways:
- The Trump-Vance FTC is making labor markets a priority for FTC enforcement.
- So far, Chairman Ferguson has signaled a move toward a more traditional enforcement approach that more precisely targets problematic conduct and lessens unnecessary burdens on businesses.
- Expect more clarity on the FTC’s enforcement approach once a Republican majority is in place. Stay tuned to the A Fresh Take blog for updates.
