The €329 million fine imposed on Delivery Hero and Glovo is a wake-up call for businesses to review their labour hiring practices and avoid the risk of competition law infringement.
Antitrust enforcement in labour markets has been gaining momentum over the past decade, becoming a global phenomenon. The US antitrust enforcement agencies have led vigorous enforcement efforts against no-poach agreements concluded between companies competing in the labour market. This has sparked a wave of investigations by European national competition authorities across several business sectors, such as banking (Denmark 2008), real estate agencies (Lithuania 2022), and engineering, technology consulting and IT services (France 2023 and Portugal 2025). However, until last year, nothing had been heard from the EU Commission. In 2024, it published a policy brief stating that the economic harm stemming from labour market agreements such as wage-fixing and no-poach agreements should not be taken lightly and that they are likely to be qualified as restrictions by object. This week, the EU Commission backed up its words with action, issuing its first ever decision on a no-poaching cartel in the food delivery market.
Luxembourg businesses need to take note of this decision and the growing enforcement trend behind it, as non-poaching agreements are attracting increasing scrutiny from competition authorities within the EU and beyond.
Landmark EU Commission decision
The EU Commission has fined two major food delivery companies (Delivery Hero and Glovo) a total of €329 million for participating in a cartel in the online food delivery sector between July 2018 and July 2022. The two companies involved (i) agreed not to poach each other's employees, (ii) exchanged commercially sensitive information, and (iii) allocated geographic markets between them.
This anti-competitive conduct took place in the context of Delivery Hero's acquisition of a minority non-controlling stake in Glovo in 2018, which progressively increased through subsequent investments until Delivery Hero acquired sole control of Glovo in 2022. According to the EU Commission, Delivery Hero's minority shareholding in Glovo (a competitor) "enabled anti-competitive contacts between the two rival companies at several levels".
Indeed, the shareholders' agreement signed initially included limited reciprocal no-hiring clauses for certain types of employees. This was subsequently expanded to a general agreement in which neither of the parties were allowed to actively approach each other's employees. The companies also exchanged commercially sensitive information in the context of Delivery Hero's acquisition of Glovo, such as information on commercial strategies, prices, capacity, costs and product characteristics. Finally, they allocated geographic markets, agreeing to "divide among themselves the national markets for online food delivery in the EEA, by removing all existing geographic overlaps between them, by avoiding entry into their respective national markets, and by coordinating which of them should enter in markets where neither was present yet".
The EU Commission found that these three anti-competitive practices amounted to a single and continuous by object infringement under Article 101 TFEU, which prohibits agreements and other restrictive business practices that may affect trade and prevent or restrict competition within the Single Market.
The EU Commission had decided to use its ex officio powers to investigate possible collusion in the food delivery sector following a market monitoring exercise. In June 2022 and November 2023, it conducted unannounced inspections at both Delivery Hero's and Glovo's premises.
Key takeaways
Competition enforcers are increasingly investigating business practices which may restrict competition in labour markets, such as no-poach or wage-fixing agreements. A key factor to take into account is the reduction of worker mobility that is created by this type of agreement.
It should be noted that even companies active in different industry sectors but hiring similar profiles are at risk of being found liable for no-poaching agreements. This is because they compete to recruit from the same talent pool, irrespective of their offering of products or services.
There is more to come as we await the Court of Justice of the EU's answers to the preliminary questions posed by a Portuguese court in relation to no-poach agreements between football clubs (see Case C-133/24) and the outcome of the EU Commission's unannounced inspections in 2024 regarding suspected no-poach agreements in the data centre construction sector.
What's the impact for Luxembourgcompanies?
It is certain that the Luxembourg Competition Authority (and potentially others) now has the support needed to initiate investigations into this type of practices in the labour market. It could do so not only in established Luxembourg market sectors, such as banking, finance and real estate, but also in emerging areas such as FinTech, green technologies, sustainability, aerospace, biotech, logistics and e-commerce.
We recommend that Luxembourg businesses review their current agreements or non-contractual arrangements to ensure they do not contain any clauses or provisions that could be deemed as being restrictive of competition.
It is also advisable for Luxembourg businesses to invest in compliance training for legal and HR teams on competition law risks related to labour market practices to ensure early detection and prevention of commercial behaviour that could restrict competition or decrease employee mobility.
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.
