An investigation is underway by the Competition Authority (AdC) into alleged anti-competitive practices in the labor market by some of the leading beverage companies in Portugal between 2016 and 2023. The companies involved have not been named.
The investigation commenced on January 12, 2024, following a leniency application, which suggested that three beverage industry companies may have entered into agreements not to hire each other’s workers.
A statement of objections was issued to three companies and, additionally, to one of their parent companies for potentially engaging in non-hiring and non-solicitation agreements.
What are ‘no-poach’ agreements?
These ‘no-poach’ agreements are arrangements where companies commit not to hire or make unsolicited offers to each other’s employees.
Such agreements impact the employees of the involved companies by reducing their bargaining power against employers and consequently their salary levels, while restricting labor mobility.
Consumers may also be affected, as ‘no-poach’ agreements could lead to reduced innovation, quality, and production, potentially resulting in higher prices or diminished quality.
The practice of ‘no-poach’ is prohibited under Competition Law as it restricts companies’ autonomy in strategizing commercial terms, particularly in human resource policies.
During the investigation phase now underway, the AdC provides the accused companies—with the presumption of innocence—the opportunity to exercise their rights to a hearing and defense concerning the behaviors under investigation, the evidence gathered, and potential sanctions.
Once this phase concludes and all available elements are considered, the AdC will adopt a final decision.
