No-Poach Agreements in Competition Law
Author I Špela Arsova
In the past, competition authorities have mainly focused on markets where companies offer various products and services. In recent years, however, their attention has increasingly turned to the labor market. At the center are so-called no-poach agreements.
What are No-Poach Agreements?
No-poach agreements are agreements between companies in which they agree not to solicit or hire each other’s employees. Such agreements may refer to:
- the active solicitation of another company’s employees (so-called non-solicitation agreements), or
- the hiring of those employees, even when they themselves contact a potential new employer (so-called no-hire agreements).
No-poach agreements restrict employee mobility, reduce workers’ bargaining power, and may lead to wage stagnation. Ultimately, limiting the movement of employees may also restricts innovation in the market and therefore have broader negative effects on the functioning of the market.
Employees are generally not informed about the existence of no-poach agreements, which distinguishes such agreements from non-compete clauses in employment contracts, as those are the result of an agreement between the employer and the employee. In no-poach agreements, employers act similarly to buyers who agree on prices, except that in this case, the agreement concerns the price of labour.
Infringements by Object and by Effect
Competition law distinguishes between:
- by object infringements, which are inherently anti-competitive by their very nature (e.g. cartels involving price-fixing or market sharing) and are always prohibited, and
- by effect infringements, where a finding of anti-competitive conduct requires proof of actual or potential negative effects on the market.
The classification of wage-fixing agreements as infringements by object seems appropriate, since such arrangements can be compared to price-fixing agreements. In no-poach agreements, employers agree not to “steal” each other’s employees. This restriction may be limited to a ban on active solicitation of another employer’s workers (non-solicitation agreements), or it may also extend to a ban on passive hiring of such workers (no-hire agreements). According to the European Commission, such agreements constitute a form of supply market sharing (supply-source sharing).
However, it could be reasoned that non-solicitation agreements are less restrictive than no-hire agreements. A no-hire agreement could be viewed as a form of supply market sharing (in this case, concerning the supply of labour), which would qualify as a restriction by object. If such agreements are concluded by all or most employers in a given market, workers effectively lose their bargaining power in relation to their current employer. By contrast, the restrictive effects of non-solicitation agreements are likely to be less severe for competition on the labour market, since workers may still approach potential employers on their own initiative, thereby retaining a significant degree of bargaining power.
Therefore, the classification of all non-solicitation agreements as restrictions by object seems somewhat oversimplified. It will be interesting to see how the European courts will assess such agreements in the future. So far, no-poach agreements have been assessed by the national competition authorities and the European Commission who have taken the view that they constitute restrictions by object. However, all of those cases concerned no-hire prohibitions, not non-solicitation agreements.
Ancillary Restraints
In certain cases, agreements containing restrictions on hiring or employment may qualify as so-called ancillary restraints and are therefore permissible. This applies where an agreement that would otherwise be prohibited is:
- directly related to another main, lawful agreement (for example, a joint product development or research project),
- objectively necessary for achieving the objective of the main agreement, and
- sufficiently limited in scope and duration.
An example of such an exception would be a cooperation agreement on the development of new technology, where the parties agree not to hire key members of each other’s project teams during the duration of the project. However, the European Commission stresses that such restrictions must remain proportionate, as companies can often achieve the same objective through less restrictive measures — for example, non-disclosure agreements, non-compete clauses, or reimbursement of training costs.
Practice of European Competition Authorities
1. EU: Delivery Hero and Glovo – Food Delivery (2025)
In June 2025, the European Commission imposed a fine of 329 million EUR on Delivery Hero and Glovo. The investigation revealed that between 2018 and 2022, the companies had entered into several anti-competitive agreements, including no-hire and non-solicitation arrangements. The Commission found that such agreements restricted labour mobility between two direct competitors in the food delivery market, thereby holding back wage growth and limiting employment opportunities for workers.
2. Portugal: Technology Consulting Sector (2024 –2025 )
In 2024 and 2025 the Portuguese Competition Authority imposed fines exceeding 6 million EUR on several companies in the technology consulting because of mutual no-hire agreements. These agreements applied to all employee profiles and were not limited in time, which the authority considered to constitute a form of labour market sharing.
3. Belgium – Private Security Sector (2024)
In 2024, the Belgian Competition Authority imposed fines of 47 million EUR on companies in the private security sector. The investigation found that the companies had concluded an agreement not to hire each other’s employees, irrespective of their role or qualification level. The authority classified this conduct as a infringement by object, given its direct impact on competition in labour and labour costs.
4. United Kingdom – Media Sector (2022)
In 2022, the UK competition authority investigated several production and media companies for prohibited wage-fixing and no-hire agreements. The companies had exchanged sensitive information on the salaries of certain employee profiles (such as editors and producers) which in itself constitutes a separate infringement of competition law, but in this case was found to be part of a broader no-hire agreement.
5. Other Cases in the EU
Similar investigations have been conducted by other national competition authorities across the EU, which found that companies in various sectors (from IT services to healthcare) had engaged in employment-restricting agreements.
Slovenia
In 2024, the Slovenian Competition Protection Agency (Agencija RS za varstvo konkurence – AVK) concluded a market inquiry into online food delivery platforms. Although no infringement was found, AVK identified potential competition risks relating to workers and contractual partners. AVK announced that it intends to monitor the labour market more closely in the future to prevent possible anti-competitive restrictions.
The Role of Whistleblowers
An important source for indentification of agreements related to the hiring of competitors’ employees are so-called whistleblower tools. In most of the cases described above, the initial reports were submitted by employees of the companies involved in the anti-competitive arrangements. The Slovenian Whistleblower Protection Act also enables anonymous reporting of competition law infringements discovered in the course of one’s work. AVK has established appropriate procedures to ensure the confidentiality and protection of such whistleblowers.
Conclusion
Given the current general shortage of labor, it can be expected that competition authorities will continue to increase their focus on the labor market in the coming years. Therefore, companies are advised to:
-
- include HR departments in their competition law compliance programs,
- regularly review existing contracts and agreements with competitors that compete for the same workforce, and
- educate management and HR staff on the risks associated with hiring-related agreements.
[1] https://competition-policy.ec.europa.eu/document/download/adb27d8b-3dd8-4202-958d-198cf0740ce3_en
[2] https://ec.europa.eu/commission/presscorner/detail/en/statement_25_1381
[3] https://www.concorrencia.pt/en/articles/adc-fined-multinationals-anticompetitive-practices-labor-market
[4] https://www.concorrencia.pt/en/articles/adc-fines-inetum-group-anti-competitive-practices-labour-market
[5] https://www.belgiancompetition.be/sites/default/files/content/download/files/20240703_Press_release_27_BCA.pdf
[6] https://www.gov.uk/cma-cases/suspected-anti-competitive-behaviour-relating-to-the-purchase-of-freelance-services-in-the-production-and-broadcasting-of-sports-content?cachebust=1697032612#non-confidential-decision
[7] https://www.varstvo-konkurence.si/informacije/novica/agencija-zakljucila-dve-raziskavi-sektorja-1/
[8] Zakon o zaščiti prijaviteljev (ZZPri), Uradni list RS, št. 16/23.
[9] https://www.varstvo-konkurence.si/informacije/obrazci-in-prijave/prijave-po-zakonu-o-zasciti-prijaviteljev-zzpri/
