On 9 April 2018 the Hong Kong Competition Commission (HKCC) issued an advisory bulletin setting out its guidance and advice on certain practices in relation to hiring and terms and conditions of employment. The HKCC highlighted that, in this context, undertakings that compete with each other to hire employees are considered to be competitors, regardless of whether they compete in the same product or services market. The advisory bulletin was especially concerned about undertakings agreeing or exchanging their intentions regarding any aspect of compensation (which is not limited to salaries and wages but can include benefits and allowances) or the solicitation, recruitment or hiring of employees (including nonpoaching arrangements), since such arrangements may amount to price fixing and market sharing. The advisory bulletin includes a number of hyypothetical scenarios in relation to these topics, as guidance for employers, employees and businesses.
In the accompanying press release, Mr. Jindrich Kloub, Executive Director (Operations) of the HKCC, reminded companies that, “[e]mployers must make their decisions about hiring and the terms and conditions of employment offered to workers independently. Where the Commission has reasonable cause to suspect that conduct contravening the Competition Ordinance has taken place, it will take the appropriate enforcement action.”
In a sign that anti-competitive employment practices are also under the spotlight of competition authorities in the U.S., the HKCC’s advisory bulletin was released shortly after the U.S. Department of Justice Antitrust Division announced its first prosecution of non-poaching agreements under its guidance for human resources professionals, issued in October 2016. Given the increasing attention of the competition authorities in this area, companies should remain alert to competition law when making employment-related decisions.