Competing for talent: labour markets remain a focus for the CMA

Historically, employers’ workforce arrangements have not been an area of focus of antitrust authorities. However, in recent years, there has been a marked shift to bring certain types of employer behaviour front and centre (as we describe below) in a number of jurisdictions, including the UK.  The reason for this is that, consistent with broader competition law principles, businesses should compete with each other for ‘talent’; the competition authorities consider that failure to do so may lead to harmful consequences including: reducing employees’ pay packets; reducing employee mobility and choice; and limiting a business’ ability to expand.

In the UK in particular, the Competition and Markets Authority (“CMA”) notes in its 2025/2026 Annual Plan that labour markets are widely recognised as an important driver of economic growth and productivity and this  is reflected in guidance published on 9 September 2025:  “Competing for Talent: What businesses need to know when recruiting workers and setting pay and other working conditions” (the Guidance).

Publication of the Guidance (as well as a case study published on the same day) is a strong signal that the CMA is increasingly  focused on conduct in labour markets and that these are issues which businesses need to take into account. Employers should therefore familiarise themselves with the three main types of anti-competitive behaviour in labour markets identified by the CMA (all of which will be treated as forms of business cartels). This behaviour is likely to manifest itself in agreements/understandings between  businesses with the aim of increasing control over the employment market, particularly the recruitment and retention of employees. Examples of such agreements would be:

• no-poaching;
• wage-fixing; and
• exchange of competitively sensitive information.

It is important to note that businesses that compete to hire or retain workers are competitors in the labour market even if they don’t compete for customers. The Guidance includes the example of a manufacturing company and a software company headquartered in the same locality. Although the companies don’t compete when selling products /services, if both want to hire software engineers, they might be competing for the same workers.

The Guidance builds on the very brief “Employers advice on how to avoid anti-competitive behaviour” document published by the CMA in 9 February 2023, and follows a CMA infringement decision in March 2025 relating to freelance/self-employed labour in the production and broadcasting of sports content. Separately, and as part of its investigation into fragrances and fragrance ingredients, the CMA is also investigating arrangements relating to the hiring or recruitment of certain staff involved in the supply of fragrances and/or fragrance ingredients.

The guidance provides various hypothetical examples of each type of behaviour, along with case studies. In respect of exchanges of competitively sensitive information, the guidance provides examples and identifies which are more likely to be problematic from a competition law perspective.

Examples of information exchanges between employers/businesses that are more likely to be problematic include:

• bilateral exchange of future pay intentions;
• unilateral disclosure of future pay intentions;
• unilateral disclosure of current pay; and
• multilateral exchange of information about pay.

Examples of information exchange that are less likely to be problematic include:

• benchmarking using a third party that ensures information is anonymised and sufficiently aggregated;
• benchmarking using public data; and
• benchmarking on HR matters that are not competitively sensitive (and limiting the exchange of information to what is strictly necessary for legitimate purposes).

Collective bargaining is also addressed in the guidance, with the CMA stating that “when gathering information to prepare for collective bargaining employers should not exchange competitively sensitive information among themselves unless it’s absolutely necessary, and only if the purpose of such an exchange can’t be achieved by other means (for example, by using an independent party to aggregate and anonymise the data)…”. The guidance also contains a hypothetical example of when collective bargaining may cross the line.

We expect to see continued enforcement of competition law issues in labour markets by the CMA and other antitrust regulators globally. Please see our previous article which discuss recent cases by competition authorities globally in this space.

Why this matters?

Although this may seem outside the normal scope of employment law issues, which tend to focus on agreements between employers and employees rather than employers and other employers, employers should be aware and take heed of the activities of the CMA, especially when engaging in any activities which involve collaborating or sharing information with competitors. Failure to do so can result in significant sanctions for both businesses and individuals.

Practical steps that businesses can take in light of these developments include providing training to those representatives who attend industry forums or trade association meetings where topics such as recruitment and labour market developments may be discussed. Employers should also make sure that their HR teams are aware of the latest developments in this area.  

Please get in touch with any of the authors or your usual BCLP contact if you would like to discuss any of the points raised in this article or any other competition or employment law concerns.