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New CMA guidance on anti-competitive HR practices
New CMA guidance on anti-competitive HR practices
18 September 2025
Series
Blogs
18 September 2025
On 9 September 2025, the UK’s Competition and Markets Authority published new guidance on the application of competition law to recruitment, retention and remuneration practices.
The guidance, titled Competing for talent, expands on the CMA’s advice released in 2023 and reflects its ongoing focus on safeguarding competition in labour markets. It sends a clear message to businesses: agreements or practices between firms on how they hire or set pay can be anti-competitive, with potentially severe consequences for both the businesses and the individuals involved.
The new guidance formally debunks the myth that competition law doesn’t apply to agreements between employers about wages or working conditions. Antitrust law protects competition in all markets, and the labour market is no exception. Just as businesses compete for customers, they also compete for talent, which helps to drive up salaries and working conditions.
When competitors agree not to poach each other’s staff, to fix pay, or to share competitively sensitive information, it can have the opposite effect on the market, suppressing pay and limiting employee mobility.
These anti-competitive HR behaviours are all forms of business cartels and do not have to be in writing, formal, or mutual to be caught.
What about collective bargaining?
The CMA acknowledges that collective bargaining plays an important role in the labour market. As such, the new guidance notes that it generally falls outside the reach of competition law and is unlikely to attract CMA intervention.
However, it also warns of the risks of straying into unlawful territory when sharing information in the context of collective bargaining. The example given in the guidance is where employers in a particular sector collude not to offer more than the recommended minimum wage so that it becomes the norm across the sector. This crosses the line into wage-fixing and is likely to be anti-competitive.
Competition authorities globally are intensifying their scrutiny of anti-competitive practices within labour markets.
In its 2025-2026 annual plan, the CMA cited functioning labour markets as “an important driver of economic growth and productivity”. It has since issued its first labour market infringement decision, imposing fines totalling £4.24 million against sports broadcasters for colluding on rates paid to freelancers. It also called on policymakers to consider how the widespread use of non-compete clauses in employment contracts affects labour markets, with the government subsequently announcing its intention to consult (see this blog).
This action in the UK mirrors a series of landmark enforcement 'firsts' by authorities in other jurisdictions.
In November 2024, the European Commission reached its first cartel finding in the labour market, imposing fines on Delivery Hero and Glovo totalling €329 million (see this blog). The US Department of Justice Antitrust Division also landed its first criminal wage-fixing conviction in the labour market earlier this year, with the convicted individual facing up to 10 years in prison and a US$1 million fine (see this blog).
Given the significant potential sanctions in the UK, including fines, disqualification of directors and/or criminal liability, and the growing appetite for enforcement, HR teams need to be aware of the potential antitrust consequences arising from routine business activities like recruitment and retention.
We set out our key HR dos and don’ts below.
Dos
Don’ts
Read more:
New consultation on use of non-competes in the UK
USDOJ lands first criminal labor market success with wage-fixing conviction
HR issues in antitrust – competing or cheating?
Cartels and Antitrust Summer Outlook. Wage-fixing and no-poach agreements
Contacts:
Gianpaolo Gangemi
Kloe Halls