The Competition and Markets Authority is increasingly looking at anti-competitive labour market practices. We discuss what employers need to know in light of a recent infringement decision. 

HR professionals may not be used to thinking about competition law, but, increasingly, they need to be aware of when it can impact on the employment relationship. In particular, a recent infringement decision and £4 million in fines issued by the Competition and Markets Authority (CMA) shows the potentially serious consequences of anti-competitive practices by employers.

Anti-competitive behaviour in labour markets

There are three main types of anti-competitive behaviours in labour markets which the CMA has made clear it will crack down on:

  • No-poaching agreements – where businesses agree not to approach or hire each others’ employees.
  • Wage-fixing agreements – where businesses agree to fix employees’ pay or other benefits.
  • Information sharing – where sensitive information about terms and conditions offered to employees are shared between businesses.

Anticompetitive behaviour is unlawful because it prevents a free market. In the context of the employment relationship, anticompetitive behaviour prevents employees from negotiating and moving jobs, and so reduces employee pay, terms and choice. Breaches of competition law are investigated and enforced by the CMA, which has the power to fine businesses up to 10% of their annual worldwide turnover. There can also be individual liability resulting in personal fines, director disqualification orders, and even criminal liability.

Recent action by the CMA

Historically the CMA has largely stayed away from the labour market and employment, but things have begun to change over the last couple of years. In 2023 the CMA published clear employers advice on how to avoid anti-competitive behaviour, and in its 2024/25 annual plan it expressly referred to UK labour markets as an important area of focus. Alongside these developments, the CMA has been demonstrating a willingness to back up its statements by conducting two long-running investigations into freelance and employed workers in the broadcast industry, which have now concluded.

The outcome of the investigations was that, on 21 March 2025, the CMA issued an infringement decision to five companies involved in the production and broadcasting of sports content. The specific breach(es) that infringed competition law were that the companies had disclosed and exchanged competitively sensitive information on rates of pay for freelance workers. There were 15 infringements in total, with the CMA also finding in two-thirds of the cases that the objectives included coordination on pay. Importantly, the CMA concluded that the infringements were ‘by object’, meaning that it was not necessary to consider the effects of the practices on the market. 

The outcome was a set of fines totalling over £4 million. Although the level of fines was not insignificant, it is worth noting that they could have been much higher, as the companies involved took advantage of the CMA’s leniency policy to secure reductions. One of the five companies involved turned whistleblower and reported its own involvement to the CMA, thus receiving 100% immunity from any fine. Others received varying reductions for cooperating with the CMA’s investigation and for accepting they had breached competition law and settling with the CMA. 

A second investigation into non-sports television broadcasting also took place, again based on sharing of competitively sensitive information about rates of pay and terms and conditions for both freelancers and employees. This investigation has now been closed as it is no longer an “administrative priority”. However, this is not the end of the story and the CMA continues to look at employment practices – for example there is currently an ongoing investigation into reciprocal arrangements relating to the hiring or recruitment of staff involved in the supply of fragrances.

Implications for employers in the advertising & marketing sector

Many clients in the advertising & marketing sectors use freelance resource.  Similarly, there is significant movement of staff between different companies and groups in the sector, which can in some cases lead to information on freelancers being shared between those different entities. Whilst there is nothing wrong with there being a generally known ‘market rate’ for different levels of freelance resource, the key takeaway for clients in the sector, and those in other sectors which commonly use freelancers, is that you must not share details about freelance resource which are competitively sensitive.

It is important to be aware that both formal and informal information sharing may fall foul of the rules, indeed the CMA guidance expressly notes that not all illegal agreements or practices are in writing, and they might take the form of informal practices. As such, even informal discussions or complaints between businesses about the cost of freelancers could impact free market movement and, as a result, may attract CMA interest. Any breach is likely to be cracked down upon firmly. Examples of this might include formal and informal non-poaching agreements, sharing of freelancer or employee rates, and potentially also agreements on alignment of covenants (such as fixed lengths of non-compete and non-poaching covenants that all businesses in a particular market agree to comply with).

Future developments both in the UK and globally

The CMA has demonstrated a willingness to become more and more involved in the employment sector.  As such, it is an area of state enforcement that employers need to be aware of, alongside the new Fair Work Agency which will unify various existing agencies and begin to enforce holiday and sick pay rights. Employment may be a cheaper and easier area for the CMA to focus on compared to more complex issues such as price-fixing cartels. There are some things businesses can do to minimise the risk of attention from the CMA, including providing recruitment staff with training on competition law and how it applies in the recruitment context, and ensuring solid internal reporting processes are in place and staff know how to use them.

The CMA’s new focus aligns with global developments aimed at increasing competition in the labour market. For example, the EU Competition Commissioner has confirmed that anti-competitive conduct in labour markets will be investigated, including no-poach agreements and wage fixing and a recent Belgian Competition Authority decision let to fines totalling EUR47m for competitors who were found guilty of a variety of anti-competitive practices. An EU policy brief on this topic was published last year, and concludes that “the harm stemming from this kind of labour market agreement should not be taken lightly”. There is also a general governmental view that increased free market competition increases GDP, which contrasts with the common business position that it is necessary to protect your own assets in order to generate profit.

The CMA has said that it will publish new guidance in the coming months on how employers can avoid becoming involved in anti-competitive behaviour in labour markets. In the meantime, employers should remember that they must set freelancer (and other) rates independently of each other, should not share commercially sensitive information with competitors and should ensure that those within the organisation who are responsible for hiring staff understand their obligations under competition law.

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