Draft Guidelines on Competition Violations in Labor Markets Published

On 16.09.2024, the Competition Authority (Authority) published the Draft Guidelines on Competition Violations in Labor Markets (Draft Guidelines) and submitted it for public comment.

The significant aspects of the Draft Guidelines are briefly summarized below:

• The Draft Guidelines aim to provide certainty regarding violations in labor markets within the framework of the Law on the Protection of Competition No. 4054 (Law No. 4054). 
• The Draft Guidelines include explanations of the types of violations that may occur in the labor markets within the framework of Article 4 of Law No. 4054 and how these violations will be evaluated by the Competition Board. In this context, the Draft Guidelines particularly focus on wage-fixing agreements and employee-no-poaching agreements that may arise in labor markets.
• In addition, the Draft Guidelines emphasize that the possibility of anti-competitive effects of information exchange should be considered not only by undertakings that are competitors in the labor market, but also by undertakings that exchange information as third parties, such as independent market research organizations and private employment agencies.
• Furthermore, it is stated that information on the working conditions of employees, such as wages, wage increases, working hours, benefits, compensation, physical working conditions, leave entitlements, etc. will be considered competition-sensitive information and the exchange of such information may have anticompetitive purposes or effects.
• Ancillary restraint assessments for agreements between competitors in labor markets will be conducted under the criteria of (i) direct relevance, (ii) necessity, and (iii) proportionality.
• The Draft Guidelines also explain the scope of application of Articles 5, 6, and 7 of Law No. 4054 to agreements and practices in labor markets.
• The Draft Guidelines state that wage-fixing and employee-no-poaching agreements and information exchanges to restrict competition in labor markets are, in principle, not eligible for exemption.
• In addition, it is stated that in assessments regarding Article 6 of Law No. 4054, whether the undertaking under review has a dominant position both in the relevant product or service market and in the relevant labor market will be examined.
• Finally, it is emphasized that whether mergers and acquisitions reduce competition in the labor market will be assessed based on various criteria, and factors such as whether the transaction poses a risk of being a killer acquisition.

Comments, suggestions, and evaluations regarding the Draft Guidelines can be submitted to the Authority until 27.09.2024.