Chandhiok & Mahajan, Advocates and Solicitors | View firm profile
No-poach agreements, also known as non-solicitation agreements, are contracts or arrangements between employers to refrain from soliciting, hiring, or requiring prior approval before hiring each other’s employees. These agreements, which can take various forms, aim to reduce competition in labour markets. They also carry the risk of suppressing wages and limiting job opportunities for employees. While such agreements may be pursuant to ancillary legitimate restrictions, they are often viewed as horizontal cartel agreements necessitating a per se approach. This article examines the global perspective on no-poach agreements, how different jurisdictions are approaching this complex issue from a competition law perspective and our thoughts on how the Indian competition authority i.e. the Competition Commission of India (CCI) is likely to approach these agreements.
Understanding No-Poach Agreements: In a competitive labour market, employers bid up compensation to attract workers, leading to efficient wage levels. To maintain the competitive pressure, workers must maintain the freedom to seek better opportunities with competing employers. No-poach agreements disrupt this dynamic by eliminating a key source of competition. While entry-level hiring and voluntary job changes may still exert some pressure, the absence of employer competition can significantly impact wage growth and employee mobility.[1]
Identifying the Relevant Market: An approach to delineating the relevant market for no-poach agreements differs from the approach adopted in delineating product-specific relevant markets. In this context, all employers, regardless of their horizontal or vertical relationship in a given product market, can be considered competitors for labour. The services of employees, whether skilled or unskilled, are considered the “product.” E.g. in the market for human resource (HR) professionals, a steel manufacturer, a law firm and a tech firm can all compete for the services of such professionals.
Legitimate vs. Anti-Competitive Restrictions: Some restrictions on labour movement may be legitimate and pro-competitive. These include protecting investments in employee training (e.g., requiring repayment of training expenses) and preventing the disclosure of sensitive information (e.g., non-compete/ garden leave clauses).[2] Antitrust regulators must distinguish between these legitimate restrictions and bilateral agreements that unduly restrict labour mobility.
However, no-poach agreements can lead to several anti-competitive effects in the market. For instance, increased entry barriers for employers and employees, reduced labour costs for employers due to coordinated purchasing and reduced employee welfare due to wage stagnation and limited job opportunities.
Competition Regulators on No-Poach Agreements across the globe
Businesses in India do enter into no-poach agreements in different forms. Till date, although the CCI has not examined no-poach agreements directly, the decisional practice of the CCI indicates that it considers labour market related conduct not to be an issue under competition law. For instance, in February 2016, the CCI in the case of Air India Ltd. v. InterGlobe Aviation Ltd.[3] analysed allegations of predatory recruitment practices of airline pilots. The CCI observed that the allegations pertained to employment issues and did not raise any competition concerns. However, the jurisprudence around labour market conduct and anti-trust issues have significantly evolved across the globe since then. The CCI has been closely monitoring recent developments around no-poach agreements and actions being taken by other competition regulators. Recently, the CCI Chairperson, Ms. Ravneet Kaur has also expressed concerns around no-poach agreements and has emphasised that the CCI may look into them if required.[4]
Various competition regulators around the globe are now proactively addressing the growing concerns around no-poach agreements through prosecution, rulemaking, and new legislations. Here’s a look at how some major regulators are handling the issue:
United States of America
The U.S. Department of Justice (DOJ) and the Federal Trade Commission (FTC) have been prioritising the regulation of no-poach agreements in the recent past. However, the law is not yet settled as to which horizontal labour market agreements are per se illegal and which may be assessed on a rule of reason basis for their net competitive effect.
In 2010, the DOJ brought one of the first no-poach cases against big tech companies in Silicon Valley alleging that the companies had agreed not to solicit one another’s software engineers.[5] While the 2010 proceedings were civil in nature, more recently, the DOJ has been considering agreements that have the sole intention of restricting competition for labour (“Naked” no-poach agreements) per se illegal and subject to criminal liability. This remains consistent with the approach adopted for per se illegal cartel cases.
On the enforcement end, the DOJ has prosecuted no-poach agreements as criminal violations of U.S. antitrust law, but with a mixed record of success. The DOJ has continued to advocate a per se approach; however, the courts have preferred a case-by-case approach, often considering the purpose and effect of the agreement, as well as potential procompetitive benefits. Much of this case law turns on whether a no-poach agreement can be argued to be ancillary to a legitimate business venture.
More recently, on 14 April 2025 the DOJ secured its first conviction in a labour market criminal trial. While the District Court of Nevada convicted the owner of a healthcare company on account of fixing wages of nurses[6] rather than for a no-poach agreement, the case still marks a monumental win for the DOJ in its pursuit of criminal prosecution in the labour market.
In April 2024, the FTC announced its final rule banning non-compete agreements, however, a federal court struck down FTC’s ban holding that the FTC exceeded its statutory authority. While the FTC has appealed the decision of the federal court, it continues to assess non-compete issues in antitrust cases on a case by case basis.
European Union
The European Commission (EC) has shown increased concern regarding no-poach agreements, although enforcement has been primarily at the national level. The EC has been looking into potential no-poach agreements in several cases with its first official investigation into no-poach agreements between food delivery companies.[7] In June 2025 the EC found its first contravention in the labour market, imposing a fine of approx. INR 3,300 crores on food delivery companies,[8] thereby highlighting EC’s priority of addressing anti-competitive concerns in the labour market. In its May 2024 policy brief, the EC categorised wage-fixing and no-poach agreements as restrictions “by object”, therefore applying the per se approach.[9]
On the other hand, various national competition authorities within the European Union have initiated investigations into no-poach agreements in several sectors, such as the floor covering sector, sport sector, and freight forwarding sector. Notably, in 2022, the Portuguese competition authority imposed a fine on Portuguese football teams and the Portuguese football league for agreeing to not hire any players who would terminate their contract during the covid-19 pandemic. National competition authorities have also classified the so-called “naked no poach” agreements as cartels and consider them as restrictions of competition “by object”.[10]
United Kingdom
In February 2023, the Competition and Markets Authority (CMA) issued guidance emphasizing the anti-competitive nature of no-poach agreements and identifying them as cartel activities. The guidance explains that no-poach agreements are formed when two or more businesses agree not to hire each other’s employees (or only do so with consent from the other employer). Although the guidance advises businesses to avoid “agreeing with a competitor not to approach or hire each other’s employees“, it is important to understand that this restriction applies beyond product market competitors and aims to encompass all no-poach agreements that have the potential to restrict competition.[11]
The CMA’s guidance was issued following the launch of its investigation in July 2022 into what are understood to be suspected wage fixing arrangements in the UK’s sports broadcasting industry. A second investigation was launched in October 2023 into similar practices in the non-sports broadcasting sector.
In January 2024, the CMA released a market research study on competition and market power in the labour market which revealed that “non compete” clauses affect around 30% of the workforce in the UK with it increasing to 40% in the scientific and tech industry which is a growing cause of concern.[12]
Brazil
Although Brazilian competition law doesn’t explicitly address labour market restrictions, the Administrative Council for Economic Defense (CADE) has begun to prohibit no-poach agreements. In March 2021, pursuant to a leniency application CADE launched its first-ever labour markets investigation in the healthcare sector, which resulted in cease and desist directions along with a penalty of approx INR 57.5 crores on the parties.
Reports indicate that CADE continues to scrutinise no-poach agreements. In October 2024, CADE launched two investigations into trade association bodies alleged to be sharing confidential employment information with companies from different industries.[13]
Mexico
The Federal Economic Competition Commission (COFECE) was one of the first competition regulators around the world to investigate no-poach agreements as a competition concern. In November 2018, COFECE investigated a “gentlemen’s agreement” between the country’s top football clubs that prevented footballers from freely negotiating and contracting with new teams. One of the parties under investigation that sought to sign a player from another party needed to obtain prior authorisation which often included some kind of compensation. COFECE concluded the investigation and imposed a fine of approx. INR 89 crores in September 2021.[14]
Canada
Notably, Canada amended its Competition Act in 2022 to include criminal cartel provisions prohibiting no-poach agreements, effective June 2023. Subsequently, the Competition Bureau of Canada (CBC) released enforcement guidelines on wage fixing and no poach agreements.[15]
While there have not been any reported cases for no poach agreements as of date, the amendment and guidelines suggest a per se approach. However, as with the earlier cartel provisions, the amended provisions for no poach include an ancillary restraints defence. The guidelines indicate that an ancillary restraints defence will be available when the restraint is ancillary and reasonably necessary for a separate agreement.
Turkey
In February 2022, the Turkish Competition Authority (TCA) penalised sixteen companies in the private hospitals industry for restricting competition in labour markets by enforcing no poach agreements. This marked TCA’s first ever public action targeting anti-competitive conduct in labour markets. In its assessment, TCA noted that there is no difference between no-poach agreements and cartels thereby, adopting a per se approach.[16] Since then, the TCA has actively pursued cases involving no-poach agreements, imposing significant fines on companies across various sectors.
In November 2024, the TCA finalised its guidelines on competition infringements in labour markets that make it clear that no-poach agreements are ‘by-object’ violations.
Cross-Border Implications
While enforcement has been largely local, cross-border implications are growing. As remote work increases, labour markets become less geographically confined, and cross-border collusion in labour markets is likely to rise. The U.S. DOJ has already addressed cases involving global suppliers engaged in no-poach agreements.
Indian context
Within the Indian competition law regime, the Competition Act, 2002 (Competition Act) provides the framework for the CCI to analyse anti competitive issues arising from no-poach agreements. Section 3(1) read with Section 3(3) of the Competition Act, prohibits cartelisation between those who are engaged in identical or similar trade of goods or provision of services. Given the broad definition of “services” provided under Section 2(u) of the Competition Act, it appears to be wide enough to include the provision of labour to the extent it is in “connection with business or any industrial or commercial matters”.
More particularly, Section 3(3)(a) of the Competition Act prohibits determination of purchase price whether directly or indirectly. The wages paid by an employer for the purchase of an employee’s services would be considered the purchase price. Accordingly, any no-poach agreement restricting an employee’s ability to seek better wages is likely to be presumed anti-competitive as it directly or indirectly determines the purchase price.
Conclusion
No-poach agreements represent a significant antitrust concern with the potential to harm both workers and competition. As various jurisdictions around the world increasingly focus on these agreements, businesses must be aware of the legal ramifications of engaging in such practices. The global trend indicates a move towards stricter enforcement and greater scrutiny of labour market restrictions.
Given the global increase in scrutiny surrounding no-poach agreements, it is likely that the CCI will develop its jurisprudence in this area. This will be particularly interesting to observe in the context of reported no-poach agreements between two major Indian business conglomerates.[17] The increasing prevalence of these agreements in India may lead the market regulator to intervene.
Avinash Amaranth – Partner Uday Bali – Associate
[1] Posner, Eric A. & Volpin, Cristina. “No-poach agreements: An overview of EU and national case law” Concurrences. 3 May 2023. Available at: https://www.concurrences.com/en/bulletin/special-issues/no-poach-agreements/no-poach-agreements-an-overview-of-eu-and-national-case-law
[2] Cordao, Catarina Lobo & Silva, Julia Piccoli. “Antitrust implications regarding “no-poach” agreements” Grinberg Cordovil. Available at: https://gcalaw.com.br/wp-content/uploads/2021/03/Acordos-de-n%C3%A3o-aliciamento-de-trabalhadores-e-suas-implica%C3%A7%C3%B5es-antitruste-EN.pdf#:~:text=Since%202016%2C%20%E2%80%9Cno-poach%E2%80%9D%20and%20%E2%80%9Cwage-fixing%E2%80%9D%20agreements%20have%20been,agreements%2C%20but%20the%20authority%E2%80%99s%20General%20Superintendency%20already%20issued
[3] Case No. 108 of 2015, order dated dated 10 February 2016.
[4] Money Control News. “Poaching of ‘AI staff’ a worry, will ‘look’ into it if needed, says CCI chief Ravneet Kaur”. 11 December, 2024. Available at: https://www.moneycontrol.com/news/business/companies/poaching-of-ai-staff-a-worry-will-look-into-it-if-required-says-cci-chief-ravneet-kaur-12887520.html
[5] Levine, Dan. “Apple, Google reach new deal to end U.S lawsuit over poaching” Reuters. 14 January 2015. Available at: https://www.reuters.com/article/idUSKBN0KN02Z/
[6] Snyder, Brent et al. “Perseverance Pays Off for DOJ in Labor Market Criminal Trial” Wilson Sonsini. 17 April 2025. Available at: https://www.wsgr.com/en/insights/perseverance-pays-off-for-doj-in-labor-market-criminal-trial.html
[7] PYMNTS. “EC Investigates ‘No-Poach’ Agreements at Food Delivery Companies”. 21 November 2023. Available at: https://www.pymnts.com/news/delivery/2023/ec-investigates-no-poach-agreements-at-food-delivery-companies/
[8] Case AT.40795 – Food Delivery Services.
[9] European Union’s “Competition policy brief”. Available at:
https://competition-policy.ec.europa.eu/document/download/adb27d8b-3dd8-4202-958d-198cf0740ce3_en
[10] Posner, Eric A. & Volpin, Cristina. “No-poach agreements: An overview of EU and national case law” Concurrences. 3 May 2023. Available at: https://www.concurrences.com/en/bulletin/special-issues/no-poach-agreements/no-poach-agreements-an-overview-of-eu-and-national-case-law
[11] Competition & Markets Authority. “Guidance- Employers advice on how to avoid anti-competitive behaviour”. 9 February 2023. Available at: https://www.gov.uk/government/publications/avoid-breaking-competition-law-advice-for-employers/employers-advice-on-how-to-avoid-anti-competitive-behavior
[12] Press Release, “CMA research report on competition and market power in UK labour market”. 25 January 2024. Available at: https://www.gov.uk/government/news/cma-research-report-on-competition-and-market-power-in-uk-labour-market
[13] White & Case. “White & Case heatmap of antitrust and labour developments (WHALD)”. Accessed on 20 February 2024. Available at: https://www.whitecase.com/map-antitrust-labour-developments-latin-america
[14] Masson, Julie. “COFECE sanctions football clubs in first no-poach probe” Global Competition Review. 24 September 2021. Available at: https://globalcompetitionreview.com/article/cofece-sanctions-football-clubs-in-first-no-poach-probe
[15] Government of Canada. “Enforcement Guidelines on wage-fixing and no poaching agreements” Competition Bureau Canada. 30 May 2023. Available at: https://ised-isde.canada.ca/site/competition-bureau-canada/en/how-we-foster-competition/education-and-outreach/enforcement-guidelines-wage-fixing-and-no-poaching-agreements
[16] Ayna, Mustafa et al. “The Turkish Competition Authority fines private hospitals for concluding no-poach arrangements, conspiring to fix wages and service fees charged to freelance physicians” Concurrences. 22 February 2022. Available at: https://www.concurrences.com/en/bulletin/news-issues/february-2022/the-turkish-competition-authority-fines-private-hospitals-for-concluding-no
[17] Business Today, ‘”Talent hard to find’: What the Ambani-Adani ‘no-poaching pact’ really means”, 26 September 2022 available at: https://www.businesstoday.in/latest/corporate/story/talent-hard-to-find-what-the-ambani-adani-no-poaching-pact-really-means-348149-2022-09-26