Anti-Trust Activity in Labour Markets
In the USA employers have, for some time, had to steer a difficult course to avoid infringement of DoL/FTC rules on anti-trust labour practices. More recently, the UK Competition Commission has raised the issue of anti-competitive actions in the labour market and in May the European Commission published a policy paper on “Antitrust in Labour Markets” finally conceding what FedEE had long warned – that wage-fixing and ‘no-poach’ agreements are likely to infringe Article 101 of the EU Treaty.
Now the Swiss Competition Commission (Comco) has gone much further in interpreting anti-trust actions by reporting its discovery of what it interprets as ‘collusion’ concerning employee compensation and benefits amongst more than 200 large companies. This, it concludes, is in probable contravention of the Swiss Cartels Act. Such perceived ‘collusion’ arose across a wide range of qualifying competitive data – such as that relating to working hours, holidays, notice periods, home office arrangements, recruitment, fringe benefits, maternity and paternity leave, meal allowances, company cars, company mortgages, health checks, daily sickness benefits and pension plans.The Commission is taking no direct punitive action at this stage, but shall be publishing guidelines which will contain an exception for multi-company collective agreements and certain training data. It has, however, already concluded that the collection and dissemination of publicly available data may qualify as anti-competitive if it involves significant effort and cost.
Finally, returning to the USA. The Federal Trade Commission, Department of Justice Antitrust Division (DoJ), the Department of Labor (DoL) and National Labor Relations Board (NLRB) have now signed an agreement to work more closely together to prevent anti-trust activities by employers.
This deal means that HR professionals will need to be even more on their guard about any links, or tacit understandings with companies outside their group, concerning such issues as poaching staff, other restrictive covenants or setting wages. What is interesting about their shared perspective is that it primarily focuses on actions that diminish the market power of workers. Thus, any ‘collusion’ between large and established companies to raise the price of labour in order to weaken smaller enterprises and start-ups by depleting them of the best available talent on the market is not regarded as an anti-trust action. This would be even more the case where a trade union is asked to sit in on the deal (as they would be happy to do) so that it could be classified as ‘collective bargaining’. In fact, recent trends in FTC investigations have largely dealt with unskilled workers – as it is here that ‘wage fixing’ amongst firms in the same sector – to the detriment of workers – is easier to trace and prove.
It is ironically just a matter of time until multi-company collective agreements (and especially the mandatory extension of such agreements to entire industry sectors) is found to be a form of anti-trust activity