Antitrust Class Action Alleges Private Security Companies Have Suppressed Security Guards’ Wages Through No-Poach Clauses

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A proposed class action filed in Florida federal court alleges illegal no-poaching agreements within the private security services industry have suppressed competition for customers and reduced wages and mobility among security guards. Named as defendants in the lawsuit are private security firm Critical Intervention Services, Inc. (CIS), its two chief operators, trade association The KKP Security Group, the Solomon Law Group, P.A., and two individual attorneys.

The complaint states that CIS suffers from “massive attrition” in that many new hires quit or get fired within a few weeks of being hired. In response, the suit says, CIS requires newly hired entry-level security guards to sign non-compete agreements as a condition of employment. The agreements, the suit says, serve to prohibit guards who “spent a very short tenure” with CIS from working for any other security company for two years following their departure from the company.

These agreements, according to the complaint, serve no purpose but to “restrain fair and lawful competition” for workers while keeping wages and mobility in check. In all, they amount to “illegal restraints of trade,” the plaintiff argues.

A step further, the lawsuit alleges outright that the individual defendants are “so deathly afraid of competition” that they’ve gone so far as to use their positions within CIS and their power as owners of trade association KKP to persuade their competitors to sign formal non-compete or non-solicitation agreements, or otherwise agree to “gentlemen’s” no-poaching agreements. According to the lawsuit, KKP is used by the defendants as a mechanism with which to “recruit competing security guard companies into their antitrust conspiracy.”

These allegedly anti-competitive activities, the case says, have restricted employee mobility and suppressed wages among security guards, who the lawsuit notes typically make no more than $12 per hour despite the level of risk associated with the job. The lawsuit names nearly 20 companies with whom the defendants have supposedly conspired to not hire each other’s employees and/or stay away from each other’s customers.

As the lawsuit tells it, the alleged conspiracy “would not have thrived as it did” without the involvement of Solomon Law Group, who the plaintiff claims filed suit against two CIS competitors to pressure the companies into signing such anti-competitive agreements as part of settlements.

“The CIS/KKP no-poaching and no-hiring agreements made on the back-end of litigation are not immune from antitrust scrutiny,” the complaint attests. “They are horizontal restraints of trade that serve no legitimate purpose and, instead, operate only to restrict employee mobility and suppress wages.”

The lawsuit seeks to cover a proposed class of security guards who have worked for CIS or KKP anytime since January 1, 2014.