Competition Compliance in Labour Markets
The Competition Board treats no-poach agreements between companies, jointly setting wages and exchanging information about employees as cartels, and the number of investigations in this area has risen markedly in recent years. With a compliance programme tailored to labour markets, we review your company’s communications, contracts and HR policies through the Board’s eyes before any investigation begins, and remove the risks.
What is a competition infringement in labour markets?
A competition infringement in labour markets occurs when companies agree, or act in concert, not to compete with each other in hiring employees and setting pay. The most common examples are gentlemen’s agreements not to hire each other’s employees, jointly setting wages and fringe benefits, and sharing sensitive information such as planned pay rises.
In 2024 the Competition Board published its Guidelines on Competition Infringements in Labour Markets. According to the Board, such conduct may be an infringement whether or not the companies are competitors in their own lines of business, because companies that compete to hire employees with the same profile are competitors in the labour market.
Scope
- Running a compliance programme specific to competition rules in labour markets
- Setting policies on agreements and information exchanges relating to labour markets
- Reviewing the e-mail and messaging correspondence of selected employees using the Board’s inspection methods
- Training and practical materials tailored to the HR team
How We Work
- Reviewing the company’s lines of business, organisational structure and HR processes
- Reviewing the computers and phones of selected employees as the Board would in an investigation, using keywords drawn from the Guidelines and Board decisions (e-mail, WhatsApp, Teams and similar)
- Reviewing employment contracts, supplier agreements (particularly with IT firms, HR agencies and private employment agencies) and pay and competition policies; preparing model protocols for risky clauses
- Delivering the findings in a Risk and Action Report with an executive summary
- Training focused on HR practices; delivering a “Do’s & Don’ts” guide, a dawn raid guide and the training materials
Team
Frequently Asked Questions
Is a no-poach agreement with a company that is not our competitor also an infringement?
Yes, it can be. The Board regards companies competing to hire employees with the same profile as competitors in the labour market, even if their lines of business differ. Unwritten, oral or tacit gentlemen's agreements are also covered.
Do non-solicitation clauses in supplier agreements cause problems?
Not always. A restriction that is tied to the main business relationship, necessary for it and proportionate in duration and scope may be acceptable. Clauses unconnected with the main relationship, unlimited in time or covering all employees of both parties are risky and should be reviewed.
Is taking part in salary surveys an infringement?
It depends on how the survey is carried out. Data compiled by an independent body, historical, aggregated and not allowing individual companies to be identified carries lower risk. Sharing current or planned pay rises company by company may be an infringement.
What are the sanctions for these infringements?
Because the Board treats such conduct as a cartel, the company may be fined up to ten per cent of its annual gross revenue. Managers who played a decisive role in the infringement may also be fined separately.
Would you like to discuss this service? Schedule a meeting with us — the first meeting is free of charge.
Schedule a meetingRelated Publications
- Competition Law and Labor Markets 31.01.2024