Shishene Jing Proposes 3-Factor Labor Maverick Test for Mergers
Updated
Updated · ProMarket · Aug 10
Shishene Jing Proposes 3-Factor Labor Maverick Test for Mergers
1 articles · Updated · ProMarket · Aug 10
Summary
Jing argues merger review should identify “labor market mavericks” — employers whose pay, hiring or training practices keep wage competition alive and whose loss could depress wages and benefits.
The proposed 3-factor test asks whether a firm consistently pays above-market wages, expands workers’ outside options through mobility-friendly practices, and invests in training that lifts the broader labor market.
The framework targets a gap in current enforcement: labor analysis is recognized in the 2023 Merger Guidelines, but regulators still rely heavily on HHI concentration measures that treat firms as interchangeable.
Jing says remedies should also change, because divestitures cannot transfer a maverick employer’s compensation culture or training commitments; in some cases, blocking a deal or imposing wage-floor and noncompete limits may work better.
Examples cited include the DOJ’s 2022 Penguin Random House-Simon & Schuster challenge and studies showing private-equity hospital acquisitions cut salary spending 16.6%, underscoring broader antitrust concern over labor-market monopsony.