Wage-fixing and no-poaching agreements will be disallowed starting June 23
The Competition Bureau has released its wage-fixing and no-poaching enforcement guidelines to provide businesses with clarity and transparency regarding the new criminal provisions of the Competition Act.
Effective June 23, the Competition Act will deem wage-fixing and no-poaching agreements illegal. The wage-fixing and no-poaching amendments were introduced as part of the Government of Canada's Budget Implementation Act, 2022, which was enacted on June 23, 2022.
Under the 2022 amendments to the conspiracy provision of the Competition Act, any agreements between employers to fix, maintain, decrease, or control wages or other terms of employment, as well as agreements to refrain from hiring or attempting to hire each other's employees, will be classified as criminal offences. These amendments aim to curb anti-competitive practices in the labour market.
Furthermore, all fines for offences under the conspiracy provision will be determined at the court's discretion, starting June 23. The violations under the conspiracy provision include agreements to fix prices, allocate markets, restrict supply, fix wages or refrain from hiring. Before the amendment, fines were capped at a maximum of $25 million.
To complement these changes, the Competition Bureau will update its Immunity and Leniency Programs to include the new provisions on wage-fixing and no-poaching. The Bureau claimed that its Immunity and Leniency Programs are its most powerful tools for detecting and stopping criminal conduct prohibited by the Competition Act.
Commissioner of Competition Matthew Boswell emphasized the importance of these amendments in the ongoing modernization of Canada's competition law. "The wage-fixing and no-poaching amendments coming into force is an important step in the ongoing modernization of Canada's competition law. With these enforcement guidelines, we're providing businesses with the certainty and predictability they need to ensure that they're in full compliance with the law."
The publication of the enforcement guidelines follows a public consultation process, where interested parties were invited to provide their views on a draft version.
