The Competition and Markets Authority (CMA) has published new, simplified guidance for employers to help businesses comply with competition law when recruiting.
The materials, which set out employers’ legal obligations in plain English, cover no-poaching agreements, where businesses agree not to hire each other’s employees; wage-fixing agreements, where businesses who compete for the same types of employees fix salaries; and information sharing about the terms and conditions of employees’ contracts.
More on compliance:
Legal teams expect a rise in HR issues in 2023
The Retained EU Law Bill will create chaos
Employment law outlook for 2023
Juliette Enser, CMA senior director of cartels, said that employers that break competition law could expect large fines, the disqualification of directors, and difficulties with recruitment and retention of staff.
She said: “Businesses have no excuse for not following the law, and ignorance is no defence when it comes to colluding with competitors to rig the labour market in their favour.”
Matt Jenkin, employment partner at law firm Moorcrofts, told HR magazine that the new guidance was a useful reminder to employers of the potential consequences of collusion.
He said: “In my experience, such practices in an employment context are rare, the fact that the CMA has chosen to issue fresh guidance would suggest that anti-competitive behaviours are still an area of concern for the CMA.”
“As such, employers should revisit training amongst the HR team so they are aware of how competition law may apply from a HR perspective, particularly in recruitment.”
The new materials include guidance on how to train HR staff on competition law, and how it applies to agreements when recruiting, and ensuring internal reporting processes are in place to warn of no-poaching or wage-fixing agreements.
Speaking to HR magazine, Enser added: “Human resource professionals have an important role to play in ensuring compliance with the law and make sure the businesses they work for steer clear of anticompetitive no-poach or wage fixing deals.”