FTC offers to wade in as wage suppression issue arises

Two former McDonald's employees are set to argue their case in the Seventh Circuit, asking the court to reinstate a lawsuit against the fast food chain.

The lawsuit accuses McDonald's of suppressing wages through a no-poach agreement among the company and its franchisees. The case has garnered particular interest from the Federal Trade Commission (FTC).

The workers' request that the court hold the agreement as a per se violation of federal antitrust law is in opposition to McDonald's position. The fast food chain maintains that the no-hire provision was ancillary to the franchise agreement to protect training investments and encourage cooperation.

A federal judge in Illinois previously denied the workers class status and ruled in favor of McDonald's. The judge held that the agreement was ancillary, and the workers had waived a rule of reason claim by failing to allege that the company exercised market power in any relevant market.

The Federal Trade Commission (FTC) has announced its participation in the oral argument as a neutral party in a proposed ban on noncompetes.

The FTC and the Department of Justice claim that the district court misapplied the ancillary-restraints doctrine and misread the US Supreme Court's opinion in Nat'l Collegiate Athletic Ass'n v. Alston.

The Federal Trade Commission (FTC) made a sweeping move earlier this year by proposing a rule that would void noncompete clauses and ban their use in...

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