On January 14, 2025, the Antitrust Division of the U.S. Department of Justice and the Occupational Safety and Health Administration of the Department of Labor jointly issued a statement, emphasizing that if confidentiality agreements (NDAs) adopted by enterprises impede employees from reporting antitrust crimes, they will seriously undermine the objectives of whistleblower protection laws, with the Criminal Antitrust Anti-Retaliation Act (CAARA) being the first to be affected. This measure aims to ensure that employees can come forward without hesitation to report when they discover antitrust violations in enterprises.
The Criminal Antitrust Anti-Retaliation Act was officially promulgated and implemented in 2019. This act clearly stipulates that employers shall not dismiss employees or take other retaliatory measures against them due to certain behaviors of employees. These protected behaviors include: employees reporting potential criminal antitrust violations and related crimes to employers or the federal government; employees assisting relevant parties in investigating such illegal and criminal acts. However, in the real business environment, some enterprises use the terms of confidentiality agreements to try to restrict employees from disclosing internal company information externally, which may cover the reporting of antitrust violation clues. This practice undoubtedly hinders the effective implementation of the law to a certain extent, making it difficult to expose and investigate some illegal and irregular behaviors in a timely manner.
In this statement, the Antitrust Division of the U.S. Department of Justice emphasized that it is of great significance to ensure that individuals can report antitrust violations without worries. The Antitrust Division shoulders the important task of maintaining the fair competition order in the market, and employee reporting, as one of the important ways to discover illegal clues, plays an indispensable role. If employees choose to remain silent about antitrust violations around them due to concerns about adverse consequences from violating confidentiality agreements, then the fairness of the market and the rights and interests of consumers will be seriously threatened.
At the same time, the Antitrust Division severely warns enterprises not to use confidentiality agreements as an improper "shield" to impede the normal progress of investigations. Once such behaviors of enterprises are verified, it is highly likely to trigger separate federal criminal violation charges. This means that enterprises will not only face the legal responsibilities that may arise from antitrust investigations themselves but also face additional criminal penalties for abusing confidentiality agreements to impede reporting. This severe warning aims to prompt enterprises to re-examine the terms and usage of their confidentiality agreements to ensure that they do not violate the legitimate reporting rights of employees.
In recent years, the United States has been active in the field of antitrust law enforcement, continuously strengthening the supervision of corporate behaviors. From the antitrust investigations of technology giants to the strict review of mergers and acquisitions in various industries, it demonstrates the determination of the U.S. government to maintain the market competition order. This joint statement on the relationship between confidentiality agreements and whistleblowers can be regarded as an important part of this series of measures. It further clarifies the boundaries of enterprises' compliant operations. Even under the premise of legitimate needs such as protecting trade secrets, it cannot be at the expense of sacrificing employees' reporting rights and impeding antitrust law enforcement.
For enterprises, this statement undoubtedly sounds an alarm. Enterprises need to re-evaluate the content of their confidentiality agreements to ensure compliance with laws and avoid legal risks due to improper agreement terms. At the same time, enterprises should establish and improve internal compliance mechanisms, encourage employees to actively participate in compliance supervision, and promptly rectify problems discovered instead of trying to cover them up through unreasonable means.
For employees, this statement provides them with more solid legal protection. When they discover possible antitrust violations in enterprises, they no longer have to shrink back due to concerns about violating confidentiality agreements. They can bravely report to relevant departments in accordance with relevant laws to safeguard their own rights and interests and the fair competition environment of the market.
