Ottawa to Ban Wage-Fixing, No-Poaching Agreements This June

The Canadian flag flies near the Peace Tower on Parliament Hill in Ottawa on June 17, 2020. (Adrian Wyld/The Canadian Press)

The federal government will be making wage-fixing and no-poaching agreements illegal for Canadian employers this year and introducing criminal charges for both offences, says Competition Bureau Canada.

“Much like other agreements between competitors, such as price fixing, wage-fixing and no-poaching agreements undermine competition,” said the bureau in a news release on Jan. 18. “Maintaining and encouraging competition among employers results in higher wages and salaries, as well as better benefits and employment opportunities for workers.”

The new amendments to Canada’s Competition Act will come into force on June 23, as first reported by Blacklock’s Reporter. They will supplement the Competition Bureau’s current Competitor Collaboration Guidelines, which outline the legal stipulations for large competitors when making employment agreements.

“As of [June 23], it will be an offence for unaffiliated employers to agree to fix, maintain, decrease or control wages or other terms of employment, or to not solicit or hire each other’s employees,” according to the Competition Bureau’s news release.

However, the federal department adds that the new provision “will apply only to new agreements entered into by employers on or after June 23, 2023, as well as to conduct that reaffirms or implements older agreements.”

“The Bureau will continue to review and update the guidelines in light of experience, changing circumstances and decisions of the courts.”

The department is also inviting Canadians to send feedback on the new competition and employment guidelines through an online portal until March 3, 2023.

Competition Act

Parliament last year via Bill C-19 passed certain amendments to the Competition Act, which now states that “every person who is an employer commits an offence who, with another employer who is not affiliated with that person, conspires, agrees or arranges to fix, maintain, decrease or control salaries, wages or terms and conditions of employment.”

Jennifer Miller, director general of the federal Industry Department’s Marketplace Framework Policy Branch, told the House of Commons Standing Committee on Finance in May 2022 that the amendments were “the product of ongoing policy dialogue with stakeholders and the Competition Bureau dating back several years.”

Conservative MP Adam Chambers asked Miller during the committee meeting on May 5, 2022, if the amendments would apply to “ride-sharing services like Uber.”

“Would they be considered captured under this new proposed rule?” he asked.

“The law applies broadly across the entire economy,” Miller replied. “In the enforcement of that act, if cases come forward, the Competition Bureau considers them in light of the general provisions and makes its determinations in the enforcements in that way.”