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No, Really, What Should a Company Do?
Obviously, if you are faced with a final judgment or a consent decree that contains compliance requirements, you do what is ordered, no matter how ineffective it might be in actually convincing people to obey the antitrust laws. But for a company that just wants to do the right thing, there are much better ways to make it more likely that a conspiracy won’t be taking place under your nose. Here are 10 key things you should do:
- Make certain that the antitrust program tracks each requirement of the sentencing guidelines.
- Tailor the antitrust compliance program to each employee’s job, not to the law. If a person is in sales, talk about the restrictions on price-fixing, bid rigging, and market allocation—and not mergers. If a person is involved in marketing, talk about unfair and deceptive practices and price discrimination, not interlocking directorates. Training should use relevant examples that the employee can relate to. (I’ve never seen a widget and don’t know why an antitrust course is worried about them. . .)
- Communicate to employees in the way they communicate—live, via computer-based training, via their smartphones, via podcast. Use the media that is easiest for them, not for you.
- Keep any sort of communications or training short and punchy. People tune out after a certain amount of time, and get angry and resentful if they are forced to sit through training that is boring and/or irrelevant to their jobs and their lives. Mix antitrust messages into other training as well. Don’t feel compelled to use an attorney for training—there is nothing that requires a law degree to say, “Don’t fix prices.”
- Recognize that each level of management has a role in an antitrust compliance program, and help them perform their roles by giving them the materials to do their job. Senior management sends a message to the organization. Department management makes sure that everyone understands the need to follow the laws, take training, and ask questions. Local management makes sure that every member of the staff knows that compliance with the antitrust laws will take precedence over any annual or quarterly goal. The board makes sure that senior management delivers, and that sufficient resources are devoted to the program.
- Perform a risk assessment to identify the highest-risk areas. Start with trade association involvement. Have the participants been trained? Have the policies and procedures of the trade associations been reviewed? Do you even know who goes to which meetings?
- Establish annual compliance goals for everyone who has annual goals, and be sure they count in performance evaluations.
- Use computerized screening to watch price quotes and look for anomalies that might indicate collusion. Antitrust audits are also appropriate, along with business controls that can reduce risk by, for example, requiring justifications for price changes, or separating the power to change prices from the people who may talk to competitors.
- Make sure that employees understand the rewards of following the law—and the consequences of violating the law. Employees who violate the law or company policy should be disciplined, and the discipline should be public.
- Whatever you do in your program, evaluate it periodically. Don’t assume that something will work with your people just because you found it in a book or a consent decree.
I could go on with more. But the main point is that companies that want to implement an effective antitrust compliance program need to do it themselves. Although it would seem to be appropriate for the Justice Department to help companies comply with the antitrust laws (as they do in so many other areas where they really want to prevent violations and not just catch them), they have chosen not to do so. So you are on your own, and while implementing a compliance program in good faith won’t necessarily convince the Antitrust Division not to prosecute should your program be imperfect, at least you will have minimized the chances that your rogue employee will be able to get the company in trouble.
Theodore Banks is president of Compliance & Competition Consultants LLC, and of counsel, Schoeman, Updike & Kaufman, LLP.
Theodore Banks is president of Compliance & Competition Consultants LLC, and of counsel, Schoeman, Updike & Kaufman, LLP.
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