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The growing importance of competition law in the labour market

Recent years have brought a significant change at the intersection of employment and competition law: competition authorities have shown an unprecedented interest in labour markets.

The growing importance of competition law in the labour market
Translated from Polish.Read the Polish original

Recent years have brought a significant change at the intersection of employment and competition law: competition authorities have shown an unprecedented interest in labour markets.

Since labour is a significant production input, one might ask why this interest emerged only recently. Employment relations were long seen as a separate sphere governed exclusively by autonomous employment law, focused essentially on the employer–employee relationship. Redefining the labour market as a purchasing market where employers compete for human resources provides a basis for assessing business conduct as potentially anticompetitive agreements.

To explain its approach, the European Commission published a “Competition policy brief” in May 2024[1]. A Polish counterpart followed several months later: the President of UOKiK’s guide “Collusion and abuses in the labour market”[2]. It identifies agreements on pay and non-competition for employees as potential competition law infringements.

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The European Commission’s approach to labour market agreements

The Commission’s policy brief analyses two types of employer agreements under EU competition rules:

  • Wage-fixing: agreements setting salaries or other forms of employee compensation and benefits;
  • No-poach: agreements not to hire other parties’ employees or actively approach them with job offers.

It classifies these practices as restrictions by object. No proof of adverse effects is therefore necessary to establish an infringement, because they are inherently harmful.

In analysing these arrangements, the Commission extends “worker” to the self-employed and questions traditional business justifications for restricting mobility. Objectives such as protecting investment in training should be pursued through employment law tools, such as confidentiality or training-cost reimbursement clauses, rather than undisclosed agreements between employers.

Not every wage-fixing or no-poach agreement will invariably be unlawful. If strict conditions are met, they may qualify as ancillary restraints without infringing competition law. The parties must demonstrate:

  • a main transaction without unlawful restrictions of competition;
  • a direct connection between the wage-fixing or no-poach arrangement and that transaction;
  • objective necessity for implementing the main transaction, meaning it would not take place without the arrangement;
  • proportionality to the main transaction, with no less restrictive alternative.

For wage-fixing, the Commission says that although ancillary classification is theoretically possible, the prospects are negligible in practice. The agreement’s nature conflicts with these criteria, particularly objective necessity and proportionality. No-poach agreements offer somewhat more scope: the Commission accepts they may address issues such as protecting investment in an employee from appropriation by competitors. Nevertheless, the brief concludes that either type is unlikely to qualify as an ancillary restraint.

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The UOKiK guide and enforcement practice

The President of UOKiK’s guide, published in July 2024, is a comprehensive explanation that labour markets face the same competition disciplines as other markets for purchasing goods and services. It lists three harmful practices: wage-fixing, no-poach agreements, and jointly setting other working conditions, which the policy brief treats as a no-poach variant. Crucially, the guide treats service contractors and people working under B2B contracts as workers, expressly in chapter 10, page 24. This broad definition matters greatly because it appears to imply that an agreement between an employer and a B2B worker is not an agreement between undertakings for competition law purposes. Consistently treating the self-employed as a form of worker despite their formal business status should mean that such an agreement is not subject to competition law restrictions.

Authorities’ growing interest is also reflected in enforcement. In Delivery Hero/Glovo (AT.40795), the companies’ agreement included no-poach clauses: from July 2018 they mutually prohibited hiring key employees and management, which the Commission found to infringe competition law.

The President of UOKiK is active too. In 2024, UOKiK announced a preliminary investigation concerning retail chains, transport companies and an alleged agreement relating to drivers.

In October 2025, proceedings were opened against three transport companies suspected of hindering drivers from changing employers and avoiding recruitment of people previously employed by competitors.

These examples show increasing determination both to raise awareness that agreements restricting employee mobility or labour market competition may be unlawful and actively to enforce the rules.

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Conclusions for labour markets

Employment and competition law increasingly overlap. Labour markets are ceasing to be a safe harbour for informal employer arrangements. The expanded definition of workers and employment matters, classification as restrictions by object, primacy of competition law over staffing needs, and rejection of typical commercial justifications for mobility restrictions all illustrate growing intervention.

Polish law reflects wider European trends. In the coming year, decisions in pending proceedings and stronger cooperation within the European Competition Network, of which UOKiK is a member, are expected. The President also emphasises whistleblowers, including victims and witnesses, potentially increasing detection of informal business arrangements concerning labour markets.

[1] European Commission competition policy brief.

[2] UOKiK guide (in Polish).

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