Comment to the FTC Regarding "Your Therapy Source" Settlement

The following is an excerpt from a public comment that Sandeep Vaheesan, along with Heidi Shierholz of the Economic Policy Institute and Marshall Steinbaum of the Roosevelt Institute, submitted to the Federal Trade Commission on August 8, 2018 regarding its proposed settlement in the Your Therapy Source matter: 

"Considering the importance of strong public antitrust enforcement in labor markets, we believe the proposed settlement order in this proceeding is inadequate. First, the respondents are not required to provide notice to the injured therapists. Workers—including non-employee contractors—often suffer in ignorance of monopsony power wielded by their employers against their interests (Cooper and Kroeger 2017). Second, the respondents do not admit liability, nor do they stipulate to the facts of the conspiracy to depress payments to therapists. Third, the respondents are not required to pay a monetary penalty.

The proposed order fails to advance both the compensatory and the deterrence functions of an effective settlement. The proposed order does not compensate injured workers—and indeed does not even enable them to seek compensation through lawsuits. It also provides no deterrence against anti-worker collusion by other employers and may even embolden other employers to collude together against workers, in light of the settlement’s insufficient remedy. By neither imposing monetary penalties nor empowering the injured workers to seek legal redress, the FTC effectively signals to employers that the legal consequences for colluding against workers are likely to be minor.

The FTC has ample room to pursue more effective remedies. The relevant law is clear. The respondents’ collusive price suppression is the type of collusion that is typically prosecuted criminally by the Department of Justice. Horizontal collusion by purchasers against sellers of goods and services, including workers, has long been per se illegal under the antitrust laws (Mandeville Island Farms, Inc. v. Am. Crystal Sugar Co., 334 U.S. 219 (1948)). Furthermore, the 2016 Guidance for Human Resource Professionals affirms this per se prohibition and (once again) puts employers on notice that collusion against workers is subject to criminal prosecution. In light of the seriousness and unambiguous illegality of the conduct at issue, the FTC should seek remedies that make the injured workers whole and deter future wage fixing by employers— including through aggressive litigation, if the respondents refuse to settle on terms that would serve those legitimate policy aims."

Read the full comment here.