Michigan Attorney General Dana Nessel has joined a coalition of 19 attorneys general in an amicus brief urging the U.S. District Court for the District of New Jersey to rule that the “no-poach” provisions used by the tax preparation chain Jackson Hewitt in its franchise agreements are presumptively unlawful. No-poach agreements between companies restrict the rights of workers to move from one job to another. The coalition argues that such agreements violate antitrust laws and harm workers.
“No-poach agreements like the ones used by Jackson Hewitt limit workers' mobility, depress wages, and create inefficiencies in the labor market. They make the labor market less fair for workers.” said Nessel. “I stand firmly with my colleagues in asking the Court to find Jackson Hewitt’s no-poach agreements anti-competitive and inconsistent with the goals of antitrust law.”
The plaintiffs in the proposed class action are former tax preparers who say they were harmed by Jackson Hewitt’s no-poach agreements.
Those agreements prohibited corporate-owned and franchise locations from hiring each other’s workers. The multistate coalition argues that these agreements are “naked” horizontal restraints of trade because Jackson Hewitt and its franchisees are direct competitors in the labor market to hire tax preparers. The amicus brief argues that no-poach agreements of this type are recognized as harmful, anticompetitive restraints and, therefore, should be considered presumptively unlawful. Jackson Hewitt is unlikely to demonstrate the no-poach agreement is
reasonably necessary due, in part, to the breadth and scope of the restrictions it places on workers.
In addition to Michigan and New Jersey, the amicus brief was filed by the attorneys general of Arizona, Colorado, Connecticut, Delaware, the District of Columbia, Hawaii, Illinois, Maine, Maryland, Massachusetts, Minnesota, Nevada, New York, North Carolina, Oregon, Pennsylvania, and Rhode Island.
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