Love, Lawsuits, and “Labor Cartels”: Our Valentine’s Update

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Love, Lawsuits, and “Labor Cartels”: Our Valentine’s Update

As we head into the weekend, we find ourselves in the midst of yet another wild news cycle. A sobering reminder of the harm that can be caused when unqualified people in positions of power lack the proper guardrails and choose instead to abuse their authority and deprive deserving individuals of what is otherwise theirs.

We are, of course, talking, about the Olympic Ice Dance scandal involving the French judge who – inexplicably – gave American figure skaters Madison Chock and Evan Bates a lower score, paving the way for the French team to win Olympic gold.

We’ll also be covering recent action from the FTC and DEI “anticompetitive collusion”, the EEOC’s investigation of Nike and alleged “reverse” racism, and Uber’s agreement to resolve alleged wage and hour violations with New York City. Because nothing says “love is in the air” like litigation. So sit back and enjoy this edition as we head into Valentine’s Day weekend.

The FTC Throws Its Hat Into The DEI Ring

Like most of us nerds in the labor and employment legal world, we’ve been waiting to hear from the Federal Trade Commission (FTC) for clarity on their enforcement efforts . . . for non-compete agreements. But if you were wondering whether the FTC would be the latest agency to wade into the anti-DEI world, do we have news for you.

FTC Chairman Andrew Ferguson sends letters to 42 firms whom the agency said sought Diversity Lab’s Mansfield Certification.

For those who haven’t had the pleasure of a deep-dive into legal industry DEI metrics, the Mansfield Certification is a program run by the consultancy Diversity Lab. It essentially asks law firms to commit to “inclusive sourcing” by ensuring that at least 30% of their candidate pools for leadership roles and promotions are composed of underrepresented talent. It’s been the “gold standard” for firms looking to prove they’re serious about diversity, but the FTC is now looking at it through a much less flattering lens.

The warning letters, issued by Chairman Andrew Ferguson, target the “knowledge-sharing” and coordinated recruitment metrics required for Mansfield Certification. The FTC is pushing a “hub-and-spoke” cartel theory, essentially arguing that when competing firms huddle together to agree on specific hiring benchmarks or share sensitive labor metrics, they risk creating an illegal “labor cartel” that distorts the market for legal talent.

As for those non-compete agreements we were worried about, the agency hasn’t walked away entirely; it’s just changed its tactics. Following a January 2026 workshop, the FTC reaffirmed that while it is no longer pursuing a blanket rule, it will continue to aggressively litigate “unreasonable” or overbroad non-competes on an individual basis.

Whether it’s DEI or non-competes, what remains clear is the federal agencies will continue to aggressively enforce the current administration’s agenda(s?). While you should always be monitoring and reviewing your internal policies regarding inclusivity and restrictive covenants, what’s becoming increasingly clear is how agencies like the FTC are using external communications as the basis for potential action.

Just Subpoena It

You’re probably thinking,  “The FTC? I thought all this anti-DEI and reverse racism stuff was being raised by the EEOC, what have they been up to recently?”

EEOC Files Subpoena Enforcement Action Against NIKE

The EEOC recently filed a subpoena enforcement action in federal court to compel the athletic giant to hand over data related to a massive investigation into systemic “reverse” race discrimination. What’s particularly newsworthy – if not unsurprising – is that this wasn’t triggered by an internal complaint from a worker. Instead, the EEOC launched this investigation itself based solely on Nike’s publicly available information (specifically their public pledges to hit 30% minority representation at the Director level and 35% across their U.S. workforce). The agency is demanding internal records reaching back to 2018, requesting everything from layoff criteria to whether executive bonuses were tied to these diversity metrics.

Nike has dismissed the subpoena as a “fishing expedition,” but the bigger picture is hard to miss. This is a loud reminder that public “corporate admissions” of diversity quotas can quickly become the basis for a federal investigation. In 2026, the safest play is to ensure your “inclusive” initiatives don’t accidentally become an “exclusive” practice. If you haven’t taken steps to audit your practices, this is a good reminder to . . . just do it (ugh we’re sorry – we had to).

So That’s How They’re Going To Fund Things!

Finally, for a bit of local news that hits close to home, the New York City Department of Consumer and Worker Protection (DCWP) just handed Uber Eats – and several other delivery platforms – a $5.2 million bill to settle alleged wage and hour violations. Uber is on the hook for the lion’s share of that total, including $3.15 million in restitution to over 48,000 workers and $350,000 in civil penalties.

While the technical violation involved failing to pay minimum rates for time spent on canceled trips, the real story here is the precursor it sets for the new administration. This settlement arrived just one month into Mayor Mamdani’s term, and the rhetoric coming out of City Hall suggests this is only the beginning of a much more aggressive era of enforcement. The new Mayor has already called for doubling the DCWP’s budget, and we are expecting city agencies – specifically the DCWP and the City Commission on Human Rights – to utilize every tool in their shed to target improper corporate behavior.

Employers should take note that DCWP Commissioner Sam Levine, a former FTC director, has made it clear that the “era of giant corporations juicing profits by underpaying workers is over”. The city has signaled a level of oversight that goes far beyond simple audits and actions; they recently sued the delivery app Motoclick and, in a move that should get everyone’s attention, named the CEO individually as a defendant.

The clear takeaway is that the “Mamdani era” is officially open for business . . . and that business is going to be free grocery stores aggressive enforcement of [alleged] workplace violations, targeting individual executives if need to be to get the message across. If you’ve been putting off that handbook update or harassment training for your managers, not sure what more you need to see here.

That’s all for this one. Have a great weekend everyone and wishing you all a wonderful Valentine’s Day. As always, if you’ve got questions, you know we’ve got answers (except if you have questions about how to fix ice dancing – that system is clearly broken).

~ The W + K Team

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