A PYMNTS Company

FTC Targets Guardian Service Industries Over No-Hire Agreements

By  |  December 5, 2024

The Federal Trade Commission (FTC) has ordered Guardian Service Industries, Inc., a building services contractor operating in New York and New Jersey, to halt its enforcement of no-hire agreements that allegedly limit employment opportunities for its workers. The action follows an FTC investigation and complaint asserting that these agreements unfairly constrain employee mobility and hinder competition in the building services sector.

    Get the Full Story

    Complete the form to unlock this article and enjoy unlimited free access to all PYMNTS content — no additional logins required.

    yesSubscribe to our daily newsletter, PYMNTS Today.

    By completing this form, you agree to receive marketing communications from PYMNTS and to the sharing of your information with our sponsor, if applicable, in accordance with our Privacy Policy and Terms and Conditions.

    Allegations of Restrictive Practices

    According to the FTC, Guardian’s service agreements with residential building owners include clauses that prevent these owners and competing contractors from hiring Guardian’s employees. These restrictions reportedly apply even after the termination of a service contract, forcing workers—such as concierge staff, custodians, and maintenance technicians—to leave their jobs if a building changes service providers.

    The FTC contends that these no-hire agreements undermine workers’ ability to negotiate better wages, benefits, and working conditions. Henry Liu, Director of the FTC’s Bureau of Competition, criticized Guardian’s practices, stating that they “restrained job mobility, wage growth, and economic freedom” for low-wage workers while stifling competition in the building services industry.

    Proposed Consent Order

    We’d love to be your preferred source for news.

    Please add us to your preferred sources list so our news, data and interviews show up in your feed. Thanks!

    Add as Preferred Source

    Under a proposed consent order, Guardian is required to stop enforcing and communicating about no-hire agreements. The order also mandates several corrective actions, including:

    • Informing current and prospective customers, as well as employees, that the no-hire agreements are no longer in effect.
    • Posting clear notices to employees, including in shared spaces, that their employment is not subject to no-hire restrictions.
    • Nullifying all existing no-hire agreements and notifying the FTC in writing of their termination.
    • Ensuring that no penalties or fees are imposed on individuals previously subject to these agreements.

    The FTC emphasized that these measures aim to restore a competitive environment in the industry and improve economic opportunities for affected workers.

    Collaboration with State Authorities

    The FTC acknowledged the support of the Attorneys General offices in New York and New Jersey during its investigation. The agency plans to publish the consent agreement in the Federal Register for public comment. Interested parties will have 30 days to submit feedback before the agreement is finalized.

    Split Decision Among Commissioners

    The FTC’s decision to issue the complaint and accept the proposed agreement was passed by a 3-2 vote. Chair Lina M. Khan and Commissioners Rebecca Kelly Slaughter and Alvaro M. Bedoya supported the action, while Commissioners Holyoak and Ferguson dissented, each issuing separate statements outlining their positions.

    Source: FTC