In this chapter, we point out that private damage suits are not available to all victims of monopsonistic exploitation. In addition to the underpaid employees who have standing to sue, there are five groups that do not have standing: (1) employees who have been priced out of the market, (2) indirect suppliers of labor services, (3) umbrella employees, (4) suppliers of complementary inputs, and (5) buyers from the cartel.

This chapter deals with agreements among rivals not to hire one another’s employees. These agreements are known as “no-poaching” agreements and have been found in a number of labor markets. There have been numerous instances of employers agreeing to refrain from hiring one another’s employees. This, of course, depresses the demand for these employees and thereby puts a lid on compensation. In this chapter, we review some prominent cases involving (1) hardware and software engineers, (2) digital animators, (3) medical school faculty, (4) physical therapists, and (5) professional athletes.

For the most part, the suits filed by the Department of Justice have been resolved. Many of the private suits filed by the antitrust victims have been settled, but some are still pending. The chapter also explores the enforcement policies of the antitrust agencies which are provided in the Antitrust Guidance for Human Resource Professionals. We will also provide an extended analysis of no-poaching agreements in professional sports.

The exercise of monopsony in labor markets is limited to one degree or another by public policy. Employer conduct aimed at creating monopsony power is governed by the Sherman Act of 1890, which forbids collusion among employers as well as competitively unreasonable conduct by a single employer.

This chapter discusses private suits and the prohibition of §1 and the sanctions for violations. Corporations are subject to fines while individuals may be fined and/or imprisoned. Section 1 forbids collusive restraints of trade. In the past, there was some confusion regarding the applicability of §1 to labor markets. These days are gone. The Department of Justice and Federal Trade Commission have issued their Antitrust Guidance for Human Resource Professionals in which the agencies make it crystal clear that they will pursue criminal convictions for collusion in labor markets. In addition to public sanctions, §4 of the Clayton Act provides a private right of action for antitrust victims.

In this chapter, we present an economic model of employer collusion that explores the economic consequences of concerted efforts to depress wages and other forms of compensation. This chapter spells out the organizational challenges of building and implementing an employer cartel. It also examines the incentives to cheat on the cartel agreement. Our central focus is on the harm done to employees as well as the impact on social welfare.

In this chapter, we review an assortment of antitrust cases that alleged collusion on the wages paid and other terms of employment. These examples include hospital nurses, temporary duty nurses, college athletes, and highly talented college students. Finally, we explore the unintended consequences of collusion in the labor market – higher prices for consumers.

In Spain, sanctions can be of three types: (1) administrative, (2) civil or (3) criminal. The first two are the most important while the third is residual and scarce, although there has been a long-running debate, especially in the academic sphere, about the convenience of greater criminalization. (1) Competition authorities can impose administrative sanctions, mainly fines, on infringers, both on companies and their directors. Exclusion of public tenders can also be imposed on entities that have been sanctioned (final sanction) for anticompetitive behaviour. (2) Commercial courts can award compensation to victims for antitust damages. These awards are always compensatory and not punitive, so they cannot exceed the damage caused. (3) Although there is no specific cartel offence, some anticompetitive conduct can also fall into some criminal types. Although the Spanish Criminal Code has since 1848 had provisions intended to penalise individuals who carry out conduct aiming at altering or manipulating prices, recourse to criminal proceedings for the sanction of these behaviours has been highly exceptional. The current trend is towards intensifying administrative and civil sanctions (higher corporate fines, more frequent and harsher fines for directors and exclusions of public tenders, while enhancing award of damages).

The chapter describes how the mix of competition law sanctions and enforcement instruments in Germany has been significantly expanded in recent years. A special feature of the German competition law procedure is that there are two different types of proceedings. Administrative proceedings allow for less serious consequences, such as prohibitions, behavioural and structural remedies, and disgorgements. More severe measures, such as regulatory fines, can only be adopted in regulatory offence proceedings. Criminal law does not play a major role in the enforcement of competition law in Germany. There is only one real criminal offence, bid-rigging. Recent reforms have concerned the liability of parent companies and legal and economic successors, the codification of the leniency programme and the calculation of fines. A highly controversial issue is the liability of managers and employees. New enforcement approaches currently being discussed or already being tested include exclusion from public tenders, reputational sanctions, whistle-blowing and increased use of negotiated settlements. Private enforcement seems to be making particularly great progress as a result of the EU Antitrust Damages Directive. Overall, the current system in Germany seeks to combine incentives for voluntary compliance with tough sanctions and strict enforcement for those who nevertheless break the law.