Why this matters?
The CMA makes clear that businesses compete not only for customers but also for workers. Agreements or practices that restrict this competition (such as wage-fixing or no-poaching) can lead to serious consequences, including fines and director disqualification. As such, it is becoming clearer to HR and recruitment teams the necessity to recognise anti-competitive behaviours and compliance risks associated.Context: CMA’s strategic shift
Historically, the CMA focused on consumer-facing markets and digital platforms. However, recent enforcement trends show a growing interest in labour markets, culminating in the recent infringement decision issued in March 2025 against broadcasters for wage-fixing in freelance hiring. The CMA’s 2025–2026 Annual Plan explicitly prioritises labour market competition, aligning with international regulators and reflecting broader economic goals around worker mobility and fair pay.Key compliance risks: a closer look
The guidance identifies three primary categories of anti-competitive behaviour in recruitment and employment. Each carries significant legal and reputational risk:
1. No-poaching agreements
What it is: Any agreement, whether formal or informal, between businesses not to hire or solicit the other’s employees. It is key to note that no-poach agreements are different to non-solicitation clauses (which are common in short-term contracts such as secondments). However, care must be taken to ensure that any non-solicitation clauses are clear in duration, subject matter and geographical scope to ensure it does not extend beyond that which is reasonably required.
Why it matters: No-poach arrangements can restrict employee mobility and reduce competitive pressure on wages and benefits. As such, these are treated by the CMA as illegal regardless of intent or effect.
Some risk scenarios which may require further review by HR teams include:
- Informal understandings between rival firms in the same sector.
- Agreements embedded in commercial contracts (e.g. joint ventures or outsourcing deals).
- Verbal assurances exchanged at industry events or networking forums.
Compliance tip: Legal due diligence reviews may be required in respect of any inter-company agreements, collaborations involving shared workforce, and internal hiring policies to ensure that these do not contain restrictive clauses which may fall under the no-poach arrangement. Further training for managers may also be necessary to avoid informal hiring pacts.
2. Wage-fixing agreements
What it is: Coordination between businesses on salaries, pay bands, bonuses, or benefits.
Why it matters: Wage-fixing undermines competition for talent and suppresses employee earnings. The CMA has already imposed fines for such conduct and is actively pursuing director disqualification in serious cases.
Risk scenarios:
- Benchmarking exercises that go beyond market research and involve direct coordination.
- Agreements reached via trade associations or sector working groups.
- Social conversations between HR professionals that lead to alignment on pay.
Compliance tip: It is essential for HR teams to establish clear boundaries for participation in benchmarking and industry forums, as well as understand the difference between lawful market intelligence and unlawful coordination. It may also be helpful to document any internal decision-making regarding pay in order to demonstrate independence when determining wage.
3. Sharing of sensitive employment information
What it is: Exchanging non-public information between competing business which may result in reduced uncertainty in the market and influence strategic decision-making. Such sensitive information may include information around salaries, benefits, hiring plans, or workforce strategy.
Why it matters: Even absent a formal agreement, sharing sensitive data can facilitate collusion. The CMA views such exchanges as a gateway to anti-competitive conduct.
Risk scenarios:
- HR professionals discussing pay trends at conferences or over email.
- Participation in surveys or data pools without proper anonymisation or aggregation.
- Informal chats between recruiters from competing firms.
Compliance tip: HR teams must implement strict protocols for external communications involving employment data, vet third-party surveys and ensure data is anonymised and aggregated. It may be useful to include competition law modules in HR training programmes moving forward as well.
Enforcement risk: What businesses should expect
The CMA’s enforcement toolkit includes onerous fines (up to 10% of annual worldwide turnover), prevention from bidding on public contracts, director disqualification, and individual prosecution. Recent analysis indicates that the CMA is increasingly targeting individuals, not just companies. Investigations are often triggered by whistleblowers or third-party complaints, making proactive compliance essential.
How can we help?
The Competing for Talent guidance is not just a warning, but a call to action. HR and legal teams must treat recruitment and retention as competitive activities governed by the same legal standards as pricing and market conduct. With enforcement intensifying, businesses that fail to adapt risk serious consequences.
DWF’s competition team can assist you in reviewing your existing arrangements, guiding you in implementing policies and safeguards to ensure competition law compliance and providing competition law training.
Co-authored by Gabriella Rasiah
