But there isn't a labor law supporting that. It's simply an anticompetitive corporate policy.

‘Established case law” or ‘Legal precedence’ to be more precise. Thank you. Ex-employees do have generous legal ground to sue for defamation.

Edit: and remember, this is to file a suit, not win a defamation suit, which can be difficult. However it is very expensive for an employer to defend itself, easily tens of thousands if not six figures of dollars. How the game is played is a disgruntled ex-employee files a suit and then tries to settle for low tens of thousands of dollars, a portion of which goes to the employment attorney they hired.