H&R Block Hit with Antitrust Class Action Over Alleged Competition-Suppressing No-Poach Agreements

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H&R Block and H&R Block Tax Services have been hit with a proposed class action lawsuit over potential violations of federal antitrust laws stemming from no-poach agreements allegedly included in the companies’ standard franchise contracts.

Filed in Illinois, the complaint explains H&R Block boasts more than 3,300 franchised entities nationwide. From at least January 2009 through at least May 2018, H&R Block, the lawsuit alleges, conspired with a number of presently unidentified co-conspirators to not solicit nor recruit each other’s employees without obtaining prior approval. The defendants’ alleged anti-competitive conduct has harmed proposed class members’ job mobility and suppressed wages, the complaint claims. 

The contractual language at issue in the lawsuit exists in a “Restriction on Competition” clause in H&R Block’s franchise documents, stating that:

“During the term of this Agreement, neither Franchisee nor any of the Franchisee’s Associates will, without H&R Block’s prior written consent… Solicit for employment any person who is employed by H&R Block or by any other franchisee of H&R Block.”

“The purpose and effect of the conspiracy was to limit employees’ job mobility and to suppress their wages, compensation, and other employee benefits,” the case reads. “As a result, H&R Block employees, including Plaintiff and Class members, were unable to seek employment with any other H&R Block locations, and as a direct result, the No Poach agreements severely decreased employment options available to H&R Block employees.”