Region 22-Newark Approves Settlement in Unlawful No-Poach Case

On December 31, 2024, the Regional Director of Region 22-Newark approved a settlement remedying an unfair labor practice charge filed by SEIU 32BJ alleging that Planned Companies D/B/A Planned Building Services, Planned Lifestyle Services, and Planned Security Services (“Planned Companies”), a janitorial, building maintenance, and concierge service provider based in Parsippany, NJ with various locations across the country, violated the National Labor Relations Act by maintaining an unlawful no-poach provision.  

On September 16, 2024, Region 22 issued a complaint against Planned Companies alleging that Planned Companies had maintained provisions in its contracts with its client buildings that interfere with, and are inherently destructive of, workers’ rights under Sections 8(a)(1) and (3) of the National Labor Relations Act. Specifically, Planned Companies restricted its client buildings from soliciting its employees to work for them in a similar job classification for a period of six months after the agreement is terminated, or from hiring employees after they leave Planned Companies’ employment. Any entity retained by the client building to replace Planned Companies was also bound by the hiring restriction. 

The settlement provides that Planned Companies will post a notice informing employees of their rights and notify client buildings that they have rescinded the applicable covenant in their client service agreements and will not enforce them. The settlement also references the remedying effect of the Letter to Customers and Letter to Employees contained in the FTC’s Proposed Consent Order announced earlier today. The NLRB and FTC collaborated on this case under the agencies’ MOU.

“This settlement demonstrates the ways that the NLRB remedies no-poach agreements that interfere with workers ability to exercise their labor rights” said General Counsel Jennifer Abruzzo. “I am very grateful for the Region’s hard work and am very proud of our partnership with the FTC to unburden workers of the effects of these unlawful restrictions.” 

In May of 2023, General Counsel Abruzzo issued a memo explaining her position that overbroad non-compete agreements are unlawful because they chill employees from exercising their rights under Section 7 of the National Labor Relations Act, which protects employees’ rights to take collective action to improve their working conditions.  

The Agency has entered into memoranda of understanding with the Federal Trade Commission, the  Department of Justice’s Antitrust Division, and the Consumer Financial Protection Bureau in order to advance a whole of government approach to the anticompetitive effects of restrictions on worker mobility. 

Established in 1935, the National Labor Relations Board is an independent federal agency that protects employees, employers, and unions from unfair labor practices and protects the right of private sector employees to join together, with or without a union, to improve wages, benefits and working conditions. The NLRB conducts hundreds of workplace elections and investigates thousands of unfair labor practice charges each year. Region 22 serves areas in New Jersey from its Regional Office in Newark.