The Federal Trade Commission (FTC) has directed Guardian Service Industries, Inc., a building services contractor in New York, to stop enforcing its no-hire agreements. These agreements prevented workers from negotiating better wages, benefits, and working conditions. The FTC's December 4 announcement revealed that Guardian included no-hire clauses in its service agreements with building owners in New York and New Jersey.

“Guardian, operating as a middleman, has restricted building owners and competitors from hiring workers while also forcing mostly low-wage employees to accept unfair employment terms that restrain job mobility, wage growth and their economic freedom,” said Henry Liu, Director of the FTC’s Bureau of Competition.

The FTC’s complaint detailed how the no-hire agreements prevented employees, including concierge workers, custodians, and maintenance technicians, from being hired by new building owners or service contractors, even after their contract with Guardian ended. In some cases, employees had to leave their positions if the building changed management.

As part of a proposed consent order, Guardian must immediately cease enforcement of these agreements and inform its employees of the FTC’s decision. Additionally, Guardian is prohibited from charging any fees related to the no-hire agreements. The move comes after previous legal challenges against no-poach agreements, including a 2022 ruling that fined a nursing services contractor $134,000.

While the DOJ has taken action against no-poach agreements in the past, the dismissal of a criminal no-poach case in 2023 could indicate a shift in enforcement efforts.