LAWREVIEW
Comp & Benefits Survey
Precautions
This Law Review was written
by Susan Feingold Carlson and
edited by Jed Mandel of Chicago
Law Partners LLC. CLP serves as
the Association Forum’s general
counsel.
Q: We would like to conduct a compensation and benefits survey of our professional association members. What issues
should the board think about before it
begins?
A: Although compensation and other
industry surveys are useful tools for associations and their members, they raise a
number of issues that your board should
consider, the majority of which arise
from the restrictions imposed by federal
and state antitrust laws. Antitrust laws
prohibit groups of competitors, which,
for certain purposes, include trade associations and professional societies, from
engaging in activities that unreasonably
restrain trade. Association exchanges of
price and cost information (e.g., salary
surveys, cost surveys and sales surveys)
raise particular antitrust concern because
while surveys can have significant pro-competitive benefits, they also can
facilitate price-fixing or other illegal standardization of the terms and conditions
of trade — if they are conducted without
appropriate safeguards in place.
To assist associations and others
involved in the exchange of price and
other sensitive business information,
the U.S. Department of Justice and the
Federal Trade Commission have devel-
oped “antitrust safety zones,” guidelines
that describe information exchanges
that generally will withstand an antitrust
challenge. Specifically, the agencies have
stated that, absent extraordinary circum-
stances, they will not challenge provider
participation in a written survey of price
and cost information if the following con-
ditions are met:
(i) The survey is managed by a third
party data-gathering organization,
which may include an association,
government agency, third-party con-
sultant or academic institution;
(ii) All survey information provided by
participants is based on data that is
more than three months old; and
(iii) Disseminated statistics are based on
data from at least five participants,
and such statistics are aggregated
such that no individual participant’s
data represents more than 25 percent on a weighted basis.
Although the guidelines were specifically prepared to address price and salary information related to health care
services, they are deemed applicable to
a much broader range of industries and
information. Thus, for example, trade
associations representing businesses
rely on them in reporting sales data, and
associations representing individuals use
them in developing and publishing salary
surveys.
The first and third requirements of the
guidelines underscore the importance of
masking the survey data provided by indi-
vidual members. Generally, individuals
and companies are free to publish their
own data. To the extent the same infor-
mation is collected for an association
survey, however, the association should
obtain the participants’ agreement not
to publish any data that would compro-
mise the confidentiality protections of
the published survey results. In addition,
if the association wants to control the
publication of the masked and aggre-
gated survey results, it should obtain the
participants’ agreement not to publish
the survey results at all. Prior to con-
ducting the survey, the association also
should determine who can participate
(e.g., members only, members and non-
members) and whether only those who
provide information will be entitled to
receive the results. Any such restrictions
should be established as a condition of
survey participation.
The answers provided here should not be construed as legal advice or a legal opinion. Consult a
lawyer concerning your specific situation or legal
questions.
