HR today, infringement tomorrow

The CMA has published a guide for employers on how to avoid breaking competition law through their activity on labour markets: available here.

The guidance is light-touch and highlights the main cartel-esque behaviours that employers should avoid in relation to HR practices:

• Making ‘no poach’ agreements with competing employers – ie agreeing not to approach / hire each other’s employees

• Wage-fixing – reaching agreements with competing employers in relation to pay or other benefits (including setting wage caps)

• Sharing sensitive and confidential information with competing employers around the terms and conditions offered to employees.

Comment

There are no real surprises here for competition lawyers, but the guidance goes with the grain of global competition enforcers showing an increased interest in businesses’ activities on labour markets. The US has seen ‘no poach’ and wage-fixing behaviours addressed as antitrust cases, while the Department of Justice published similar antitrust ‘guidance for HR professionals’ a few years ago. Enforcers in other jurisdictions have also published on the issue and in 2021 the EU’s Commissioner for Competition – Margrethe Vestager – explained that the European Commission was looking to investigate ‘non-traditional’ anti-competitive conduct such as wage-fixing and no-poach arrangements. The CMA’s Annual Plan consultation 2023 to 2024 recently noted the CMA’s intention to “clamp down on cartels and other collusive behaviour that stops public bodies and private households making the most of their available budget, for example agreements that seek to keep prices up in public procurement or interfere in labour markets.”

Whilst not containing anything ground-breaking, the guidance does illustrate the importance to businesses of spreading competition law awareness throughout their organisations; not only to frontline sales staff and management, but to business-support units such as HR / People teams.