Competition Bureau invites comments on new guidelines for wage-fixing and no-poaching agreements

Recent amendments will disallow the use of these agreements

Competition Bureau invites comments on new guidelines for wage-fixing and no-poaching agreements

The Competition Bureau has invited interested parties to comment on new guidelines to address wage-fixing and no-poaching agreements.

The Bureau developed the guidelines following recent amendments to the Competition Act, which will come into force on June 23. When the amendment comes into force, wage-fixing and no-poaching agreements will become illegal and subject to significant criminal penalties in Canada.

Subsection 45(1.1) of the Act was added to protect competition in labour markets. The provision makes it an offence for unaffiliated employers to agree to fix, maintain, decrease, or control wages or other terms of employment or to not solicit or hire each other’s employees. Subsection 45(1.1) is directed at “naked restraints” on competition, which are restraints on wages or job mobility that are not implemented in furtherance of a legitimate collaboration, strategic alliance, or joint venture.

The provision will apply only to new agreements entered by employers on or after June 23 and to conduct that reaffirms or implements older agreements.

The Bureau has issued new guidelines describing its approach to enforcing subs. 45 (1.1). They will supplement the Bureau’s current competitor collaboration guidelines. The Commissioner of Competition and the Bureau are responsible for investigating any matter that involves an offence under the Competition Act.

The Bureau asserted that much like other agreements between competitors like price fixing, wage-fixing, and no-poaching agreements undermine competition. It argued that maintaining and encouraging competition among employers results in higher wages and salaries and better benefits and employment opportunities for workers.

Interested parties can provide comments on the Bureau’s guidelines online by March 23. According to the Bureau, it will publish each submission on its website unless the provider specifically requests that it be kept confidential. The Bureau will continue to review and update the guidelines considering experience, changing circumstances and decisions of the courts.

Recent articles & video

Understanding why Goliaths are so powerful, and knowing how to fight them

Roundup of law firm hires, promotions, departures: June 5, 2023 update

Lawyers laud Australia-UK FTA

From in-house counsel to angel investor, 1Password’s CLO Erin Zipes reflects on building a practice

Mounting threats to gender-based rights a theme at LEAF’s annual Equality Day reception

Ontario Court of Appeal clarifies insurance coverage rule for passengers of stolen vehicles

Most Read Articles

Cassels reimagines office design, replaces ‘old partner’ setup with ‘equality of access’ to daylight

SCC finds company committed abusive tax avoidance in case dealing with general anti-avoidance rule

David Stern’s cold calls launched his career in entertainment and sports law

Roundup of law firm hires, promotions, departures: May 29, 2023 update