UOKiK has opened an investigation into labour practices at Biedronka and Dino

by   CIJ News iDesk III
2024-07-09   07:12

The Office of Competition and Consumer Protection (UOKiK) has opened an investigation into labour market and practices at the Dino and Biedronka chains and the transport companies serving them, the UOKiK Office said.

The UOKiK is investigating whether, together with the transport companies, the chains illegally agreed not to poach drivers from each other, and in February and April this year. With the permission of the court and assisted by police officers, UOKiK employees searched the premises of Jeronimo Martins Polska, Dino Polska and the transport companies. Analysis of the collected materials is ongoing, it was stated.

The investigation is conducted in the case and not against specific entrepreneurs, it was emphasised. If the collected material confirms the suspicions, then the President of the Office will initiate antitrust proceedings and bring charges against specific entities. Participation in a competition-restricting agreement is punishable by a financial penalty of up to 10% of the entrepreneur's turnover. Managers responsible for entering into a collusive agreement, in turn, face a fine of up to PLN 2 million, it noted.

"We suspect that the entrepreneurs who provided services to the Biedronka and Dino chains may have concluded an agreement under which they did not compete among themselves for employees. We are also investigating whether such arrangements may have been coordinated by the retail chains. The effect of the analysed practices would have been that drivers would not have been able to change their jobs flexibly and that the rate of increase of their salaries would have been limited," said UOKiK President Tomasz Chróstny.

The Office reported that, as a result of a possible agreement, transport companies may not have employed drivers working for other participants in the suspected collusion. In turn, the owners of the discount stores could have imposed and enforced the carriers' compliance with the agreed rules. This could have consisted of a trader whose employee left his or her job without an agreement with him or her submitting a 'block' of such a person to the chain. The driver would then not be able to take up employment with another carrier serving the distribution centre in question.

Non-compete agreements for employees, or so-called 'no-poaching agreements', affect the most sensitive element of price competition between employers - the wages offered to employees. They can lead to employees' wages being lower or not increasing as much as they would if there were no such collusion, UOKiK reported.

UOKiK also noted that competition law prohibits agreements that have the purpose or effect of restricting competition. The most well-known examples of prohibited activities are collusive pricing, bidding or market sharing. Entrepreneurs themselves are not always aware that competition law also applies to markets other than those on which they sell their products. Meanwhile, restrictive agreements can also apply to the labour market and employee arrangements.

"Conspiracies restricting competition in the labour market have a negative impact on both the situation of employees and the dynamics of economic development. That is why we have prepared a special guide explaining when such actions may not be allowed and may incur a high financial penalty. It is a must-read, especially for every employee, HR departments, as well as large and small businesses and trade unions," the UOKiK President pointed out.

The Office reminded that it is forbidden to jointly fix wages for employees, e.g. to reduce or set a ceiling on wages, or not to give any increases, so-called 'wage-fixing'. In such cases, colluding entrepreneurs eliminate the risk that an employee will leave after receiving a better offer from a competitor. Another example of a breach of the law is arrangements not to compete for an employee, so-called no-poaching. Businesses thus eliminate the risk that a competitor will recruit their employee. In doing so, they may agree among themselves, for example, not to actively solicit their employees. The arrangements may also take a more passive form, e.g. not to engage in a job interview if a CV is received from an employee of the other collusive party. It may also be unlawful to jointly agree other working conditions that affect the attractiveness of the employer, such as the number of days of remote working, it stressed.

Another issue clarified by the president of the UOKiK is non-compete clauses. This refers to clauses prohibiting an employee from taking up employment with a competitor of the existing employer after the termination of the employment relationship or performing tasks for other entities during the course of employment. If such clauses are inserted into a contract as a result of an agreement with other entities, they may constitute a breach of competition law, the UOKiK also pointed out.

Source: UOKiK and ISBnews

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