The European Commission (the "Commission") and national competition authorities have made it clear that no-poach and wage fixing agreements - even between non-competing businesses - may constitute serious competition law infringements and are treating such restrictions as (likely) "by-object" infringements, comparable to price-fixing or market-sharing.
Case law developments
On 2 June 2025, the European Commission reached its first-ever decision against a no‑poach agreement, and fined Delivery Hero and Glovo a total of €329 million for entering into reciprocal no‑hire clauses. The Commission concluded that this constituted a restriction of competition by object, i.e., inherently anti‑competitive, regardless of the actual effect on the relevant market.
The case also involved other serious infringements involving exchange of commercially sensitive information (relating to pricing and strategy) and the allocation of national markets, constituting a single and continuous infringement, and therefore the fine was not attributed exclusively to the no-poach agreement. The infringement was facilitated by Delivery Hero's minority shareholding in Glovo.
National competition authorities have reached similar decisions recently. On 11 June 2025, the French competition authority (FCA), imposed fines totalling €29.5 million on engineering and consulting firms for engaging in "gentleman's" no‑poach agreements, independently deemed a "by object" infringement. In February 2025, the Portuguese competition authority (AdC) fined Inetum approximately €3.1 million for a stand‑alone no‑poach agreement, as part of broader enforcement action within labour-market collusion. Three other companies operating in the same market had previously been fined €4.1 million for similar conduct.
Of a similar nature, i.e. reflecting labour‑market collusion, is the decision by the UK competition authority (CMA), in March 2025, imposing fines of more than £4 million on broadcasters, including the BBC and ITV, for coordinating the rates paid to freelance workers.
Similar enforcement actions have previously been taken by national authorities in Belgium, Hungary, Slovakia, Poland, and Romania, with prior sanctions targeting no‑poach or wage‑fixing agreements in sectors such as HR services, security, and sports clubs.
Explanation and legal basis
No-poach agreements are agreements between businesses that restrict the hiring of each other's employees. Such agreements can negatively affect the economy, as employee mobility often results in higher wages and increased efficiency.
As the name suggests, wage-fixing agreements involve businesses agreeing to set wages at certain levels, thereby eliminating the potential benefit of a salary increase for employees considering switching employer.
These agreements may be explicit or based on a mutual understanding, and are typically concealed from employees.
Both no-poach and wage-fixing agreements fall within the scope of Article 101(1) TFEU. As stated above, such agreements are likely to be considered violations of EU competition law by object.
It is important to note that, even in the absence of product or service market rivalry, no‑poach and wage-fixing agreements may constitute serious infringements of Article 101(1) TFEU and corresponding national legislation. The competition authorities assess competition on the basis of shared talent pools, not solely on overlapping products or sectors. Competition for personnel is not necessarily confined to the same sector or industry; companies from different sectors may also compete for employees. Accordingly, businesses operating in entirely different industries but competing for the same type of workers could also face enforcement risks.
Exceptions
As the Commission states in its policy brief on the matter, no-poach and wage-fixing agreements will rarely qualify for exemption under Article 101(3) TFEU, as such agreements are generally not considered to generate any pro-competitive effects.
The Commission does, however, acknowledge that in special circumstances, such as joint ventures, a no-poach clause enabling the parties to assign key employees to the project without the risk of them being poached by the other parent companies may be considered an ancillary restraint, provided the parties can demonstrate that the clause is necessary and that no less restrictive measure could achieve the same objective.
Advocate General Nicholas Emiliou called for a more nuanced approach in a recent opinion in a case concerning a no-poach agreement between Portuguese football clubs, facilitated by the Portuguese football league during the COVID-19 pandemic. He emphasised that "the context always matters" and argued that the no-poach agreement in question should not be considered a by object infringement.
The Advocate General argued that the competitive dynamics of professional sport can justify a certain degree of cooperation between rivals to maintain the level of sporting competitiveness that makes the games entertaining. As such, the effects of the agreement could be seen as pro-competitive. Similarly, in specific circumstances, no-poach agreements may also generate pro-competitive outcomes in other contexts, such as within franchise networks characterised by a high level of interdependence.
Moreover, the agreement was concluded under extraordinary circumstances arising from the COVID-19 pandemic. This was underscored by the fact that, just a few weeks prior to the conclusion of the no-poach agreement, the European Competition Network had issued a joint statement acknowledging that cooperation between businesses could be necessary in such circumstances.
The European Court of Justice has yet to issue its decision in the case, and the Advocate General's opinion is not binding on the Court.
Anticompetitive behaviour in the Danish Labour Market
A report based on a joint study by the Nordic competition authorities on competition in the labour market was published in early 2024. The study concluded that the Nordic labour markets are less likely to experience the potentially harmful economic effects of no-poach and wage-fixing agreements, owing to their high level of labour unionisation.
To date, the only Danish case on this issue is the Danish Competition Council's 2008 decision concerning the Trade Association of Local Banks, Savings Banks, and Cooperative Banks in Denmark ("LOPI"). In that case, the Council found that LOPI had discouraged its members from actively headhunting employees from other member banks by threatening to exclude those engaging in such practices from the association. However, the Council refrained from issuing an injunction, as LOPI had amended its policies prior to the decision being issued.
Implications
Further cases concerning no-poach and wage-fixing agreements are expected to follow. Businesses should therefore review their labour market practices and conduct to ensure compliance with competition law.
It should be borne in mind that no-poach and wage-fixing agreements are likely to constitute an infringement of competition law, even where the parties to such agreement are not regarded as competitors in any product or service market downstream. Competition authorities may also consider targeting other forms of input coordination, such as the sharing of essential data, raw materials, or technology, between businesses that are not competing on any downstream market.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
