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If a person is employed at Company A, is it legal for Company B to require a signed document of permission from Company A before applying? This would obviously put the applicant in the uncomfortable position of telling their current job they want to explore other options.

The two companies have done business but their MSA does not specifically disallow hiring of each others employees.

Does such a requirement not essentially constitute a "no poaching" agreement?

Edit:

The jurisdiction in question is the United States. I am more specifically wondering if this is an anti-trust issue. It places a burden on employees of a certain company that is not present on others.

Here is a summary of the US Justice Department and FTC's recent anti-trust rulings.

  • Could you elaborate on the relevant jurisdiction and employee's position? – Singulaere Entitaet Mar 15 '17 at 7:29
  • Sorry, first time posting in Law. This is in the United States, and the position is middle management. – wodtke7 Mar 15 '17 at 14:15
  • The silence of the MSA between the companies is interesting but irrelevant. What about the employee contract. And the contracts of other employees. And the history of litigation between the two companies. – jqning Aug 14 '17 at 3:38
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You do not give a jurisdiction so I will answer for New South Wales, Australia.

Discrimination in the job market is legal except where it is on the basis of a prohibited basis. In none of the legislation is employment status prohibited.

Yes, the can require this. Yes, they can refuse to consider you if you do not get one.

The relevant Acts and the basis they define are:

Australian Human Rights Commission Act 1986 (Cwth)

Discrimination on the basis of race, colour, sex, religion, political opinion, national extraction, social origin, age, medical record, criminal record, marital or relationship status, impairment, mental, intellectual or psychiatric disability, physical disability, nationality, sexual orientation, and trade union activity.

Also covers discrimination on the basis of the imputation of one of the above grounds.

Age Discrimination Act 2004 (Cwth)

Discrimination on the basis of age – protects both younger and older Australians.

Also includes discrimination on the basis of age-specific characteristics or characteristics that are generally imputed to a person of a particular age.

Disability Discrimination Act 1992 (Cwth)

Discrimination on the basis of physical, intellectual, psychiatric, sensory, neurological or learning disability, physical disfigurement, disorder, illness or disease that affects thought processes, perception of reality, emotions or judgement, or results in disturbed behaviour, and presence in body of organisms causing or capable of causing disease or illness (eg, HIV virus).

Also covers discrimination involving harassment in employment, education or the provision of goods and services.

Racial Discrimination Act 1975 (Cwth)

Discrimination on the basis of race, colour, descent or national or ethnic origin and in some circumstances, immigrant status.

Racial hatred, defined as a public act/s likely to offend, insult, humiliate or intimidate on the basis of race, is also prohibited under this Act unless an exemption applies.

Sex Discrimination Act 1984 (Cwth)

Discrimination on the basis of sex, marital or relationship status, pregnancy or potential pregnancy, breastfeeding, family responsibilities, sexual orientation, gender identity, and intersex status.

Sexual harassment is also prohibited under this Act.

Fair Work Act 2009 (Cwth)

Discrimination on the basis of race, colour, sex, sexual orientation, age, physical or mental disability, marital status, family or carer responsibilities, pregnancy, religion, political opinion, national extraction, and social origin.

Anti-Discrimination Act 1977 (NSW)

Discrimination on the basis of race, including colour, nationality, descent and ethnic, ethno-religious or national origin, sex, including pregnancy and breastfeeding, marital or domestic status, disability, homosexuality, age, transgender status, and carer responsibilities.

Sexual harassment and vilification on the basis of race, homosexuality, transgender status or HIV/AIDS status are also prohibited under this Act.

  • I read the question as leading towards an anti-trust style prohibition. I think I've heard of laws against collusion by employers in hiring, though I don't recall details or jurisdicitons. – feetwet Mar 15 '17 at 1:41
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    @feetwet you are correct. I was referring to recent anti-trust provisions by the US Department of Justice. This is a summary. – wodtke7 Mar 15 '17 at 14:18
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There are different situations. If the owner of company A believes for some reason it is a good idea to require such a document from anyone applying for a job, they can clearly do that. I would assume that they won't get many job applications. People often think that because something is stupid and nobody would do it, it must be illegal. That's not the case.

If company A and B have an agreement that neither company will take an application from the other company's employees with such permission, I wouldn't be surprised if that would be covered by some anti-trust prohibition. However, there would be no need for such a document before applying, just before hiring.

The third possibility is an employer in a specially trusted position at B, and company A fears there is legal trouble coming if they hire that employee away from A. Like chemical company A hiring the chief of product development of chemical company B.

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