Competing for talent: key considerations from the CMA’s latest guidance

Blog

03.10.2025

In September 2025, the Competition and Markets Authority (CMA) published new guidance on 'Competing for Talent', clarifying how competition law applies to recruitment and employment practices. While competition law is often associated with pricing and market share, the CMA makes clear that it also applies to employers when hiring workers or setting pay and working conditions, even where those employers do not compete for customers.

The guidance is aimed at employers (particularly anyone involved in recruitment and retention, including HR professionals) to help them understand the types of conduct that may breach competition law when recruiting or retaining staff, and what steps they can take to stay compliant. This follows the CMA’s stated intention in its 2024/25 annual plan to focus more closely on labour markets, and reflects a broader international trend. The risks are potentially serious: in March 2025, the CMA fined five sports broadcasters over £4 million for anti-competitive labour practices, and an investigation into recruitment practices in the fragrances sector is ongoing.

What does the guidance say?

The guidance identifies three main types of anti-competitive behaviour in labour markets:

No-poaching agreements

These are arrangements between businesses not to hire or approach each other’s employees. They can take various forms, including agreements not to actively approach staff (eg 'no-cold calling' agreements) or agreements requiring consent before hiring another business’s employees. The guidance is clear that such arrangements do not have to be mutual in order to be caught.

The guidance distinguishes no-poaching agreements from non-solicitation clauses in commercial contracts, such as consultancy or secondment agreements or other agreements between service providers and their customers. Non-solicitation clauses in such agreements may be permissible provided they are:

necessary to the wider agreement; and
proportionate to its overall objectives and in scope, duration and geography.

Wage-fixing agreements

These involve businesses that compete for the same type of employees agreeing to fix pay, benefits or other employment terms, such as setting salary bands or agreeing to limit wage increases.

The guidance includes two examples of wage-fixing through an industry forum and a trade association, highlighting the need to be careful at meetings where competitively sensitive information, such as wages or employment terms, might be discussed. Even informal coordination – for example, agreeing not to exceed a certain percentage increase for wages – can be unlawful wage-fixing if it reduces competition for talent.

Sharing competitively sensitive information

This includes exchanging 'competitively sensitive' information that could reduce uncertainty in the labour market or influence competitors’ strategies. Examples include future salary plans, hiring strategies and benefits packages. Even unilateral disclosures can breach competition law.

The CMA notes that whether sharing information between businesses breaches competition law depends on factors such as the type of information, the method of exchange, and the characteristics of the market. It sets out high-level principles to provide a steer on when competition concerns might arise:

publicly available information is less likely to be problematic;
older data is generally less sensitive than current or forward-looking information; and
appropriately anonymised data is less likely to raise concerns.

However, these are not hard-and-fast rules, and a case-by-case assessment is required. Importantly, a business that receives competitively sensitive information is presumed to have acted on it unless it publicly distances itself or reports the contact to the CMA. The guidance provides the relevant contact information for those seeking to make a report to the CMA.

What about collective bargaining?

The CMA confirms that genuine collective bargaining between employers and recognised workers’ organisations is not caught by competition law. This exemption covers both coordination between employers in preparation for collective bargaining and the collective bargaining negotiations themselves.

However, even when employers are preparing for collective bargaining, competitively sensitive information should not be shared unless strictly necessary. Further, coordination outside of the collective bargaining context (particularly if it involves sensitive information) may still breach competition law.

What are the risks of getting it wrong?

The consequences of breaching competition law can be severe, including:

fines of up to 10% of global turnover;
exclusion from public procurement; and/or
liability to pay private damages.

Practical considerations

The CMA’s guidance is a timely reminder that recruitment processes and employment practices around wages must comply with competition law. Employers should take steps now to review their arrangements and ensure staff are aware of the risks. In particular:

1. Review existing agreements and practices

Audit any formal or informal arrangements with other employers. Pay particular attention to:

non-solicitation clauses in commercial contracts;
any verbal or email agreements not to hire from certain firms; and
participation in industry forums where sensitive information may be shared.

2. Train HR and recruitment teams

Ensure that staff involved in hiring and compensation decisions understand how competition law applies to their roles. Training should cover:

what constitutes anti-competitive behaviour;
how to handle unsolicited sensitive information; and
when to escalate concerns internally.

3. Avoid sharing sensitive information

Be cautious when participating in benchmarking exercises or informal discussions with peers.

If sensitive information is inadvertently received, document your response and consider taking legal advice on making a report to the CMA.

4. Put in place internal reporting mechanisms

Create or reinforce whistleblowing and internal reporting channels. Employees should know how to report concerns confidentially and who to contact for legal or compliance advice.

Alongside this, employers should review existing recruitment and HR policies to ensure they reflect current competition law guidance. This includes policies on information-sharing, recruitment practices, and interactions with competitors. Legal advice can be sought to assist with policy audits and updates to ensure compliance and mitigate risk.