New Evidence on Employee Noncompete, No Poach, and No Hire Agreements in the Franchise Sector

This article presents new evidence on anticompetitive practices in the franchise sector. Drawing from a corpus of Franchise Disclosure Documents (FDDs) filed by 3,716 franchise brands in years 2011–2023 (partial), I report new information on franchise brands' use of interfirm nonsolicitation (“no poach”) clauses barring recruitment between firms, no hire clauses barring employment, and franchisor requirements that franchisees use employee noncompete clauses barring workers from joining competitors. Regulatory actions that restricted the enforceability of anticompetitive clauses began to appear in FDDs in 2018. While nonsolicitation and no hire clauses have declined in use, the use of noncompetes remained stable over time. While prior evidence on anticompetitive practices largely draws from individual complaints, survey data, and limited hand-coded samples, this article spotlights new methods for finding barriers to worker mobility in large, unstructured text corpora.