The Office of Competition and Consumer Protection (UOKiK) has initiated an investigation into the retail chains Biedronka (Jerónimo Martins) and Dino (Tomasz Biernacki). UOKiK is examining whether these retail chains and their associated transport companies have entered into illegal agreements aimed at restricting competition in the labor market. In February and April of this year, UOKiK employees searched the offices of Jeronimo Martins Polska and Dino Polska with court approval.
Companies do not want to poach each other’s employees. What’s the problem?
The President of UOKiK, Tomasz Chróstny, explains that entrepreneurs providing services for the Biedronka and Dino chains may have entered into an agreement that prohibited them from competing for employees. As a result, drivers would not have the flexibility to change jobs, and their wage growth would be limited. It is also suspected that such agreements might have been coordinated by the retail chains themselves.
As a consequence of these actions, transport companies might not hire drivers working for other collusion participants. The discount store owners could impose and enforce rules established by the carriers. For example, an employer could place a “block” on an employee who left their job without consent, preventing that employee from taking a job with another carrier serving the same distribution center.
UOKiK on non-compete agreements and competition law
UOKiK emphasizes that competition law prohibits agreements aimed at restricting competition. The most well-known examples are price-fixing, bid-rigging, or market division. Entrepreneurs are not always aware that competition law also applies to the labor market. Anti-competitive agreements can include arrangements concerning employees, negatively affecting their wages and working conditions.
Sanctions for collusion in the labor market
Participation in an anti-competitive agreement can result in a financial penalty of up to 10% of the entrepreneur’s turnover. Managers responsible for the collusion may face a fine of up to 2 million PLN. UOKiK is conducting an explanatory proceeding regarding the matter, not against specific entrepreneurs. If the gathered evidence confirms the suspicions, the President of UOKiK will initiate antitrust proceedings and charge specific entities.
Do you know about company collusion? Notify UOKiK
UOKiK encourages reporting instances of company collusion. On the Office’s website, you can anonymously report any irregularities. The Office reminds that joint wage-setting, lowering salaries, setting upper wage limits, and lack of raises are prohibited. Agreements on other working conditions, such as the number of remote work days, are also forbidden.
Company reactions
The Biedronka chain responded to UOKiK’s proceedings by emphasizing that it awaits further developments with confidence that its actions have been in accordance with legal regulations and good market practices. The company noted that most of its transport services are provided within long-term partnerships.
Summary
UOKiK is conducting an explanatory proceeding against Biedronka and Dino, which may have engaged in illegal collusion in the labor market. The Office is investigating whether the retail chains and transport companies violated competition law, potentially negatively affecting the working conditions and wages of drivers. Participation in such agreements carries substantial financial penalties for both entrepreneurs and managers responsible for the collusion.
QUESTIONS: UOKiK Proceedings Against Biedronka and Dino
1. What is the subject of UOKiK’s proceedings against Biedronka and Dino?
The explanatory proceeding conducted by the Office of Competition and Consumer Protection (UOKiK) concerns the labor market and practices in the Biedronka and Dino retail chains. The Office is investigating whether these chains, in cooperation with transport companies, have illegally agreed not to poach each other’s drivers.
2. What actions has UOKiK taken as part of this proceeding?
In February and April of this year, UOKiK employees, with court approval and police assistance, searched the offices of Jeronimo Martins Polska and Dino Polska. This was part of the actions aimed at gathering evidence of potential collusion.
3. What are no-poaching agreements?
No-poaching agreements are agreements between companies that stipulate they will not recruit each other’s employees. Such actions can restrict competition in the labor market, negatively impacting employees’ wages.
4. What legal consequences could Biedronka and Dino face if UOKiK confirms the illegal collusion?
If UOKiK confirms the illegal collusion, the President of UOKiK can initiate antitrust proceedings and charge specific entities. Participation in an anti-competitive agreement carries a financial penalty of up to 10% of the entrepreneur’s turnover. Managers responsible for the collusion may face a fine of up to 2 million PLN.
5. What does Biedronka say about UOKiK’s proceedings?
The Biedronka chain expressed calm while awaiting further developments, emphasizing that their actions were in accordance with legal regulations and market practices. They also noted that most of their transport services are provided within long-term partnerships.
6. What other practices might violate competition law according to UOKiK?
In addition to no-poaching agreements, competition law prohibits joint wage-setting (wage-fixing), price-fixing, bid-rigging, and market division. Such actions can negatively affect the situation of employees and the dynamics of economic development.
7. What signals have reached UOKiK regarding Biedronka and Dino?
UOKiK has received an increasing number of signals this year about improper practices by Jeronimo Martins Polska, Dino Polska, and transport companies concerning the labor market. These signals were one of the reasons for initiating the explanatory proceeding and conducting searches.
8. What is the “block” of drivers in the context of UOKiK’s allegations?
A driver’s block is a practice where an employer, whose employee left without consent, reports such a person to the network, preventing them from taking a job with another carrier serving the same distribution center. UOKiK is investigating whether such actions took place in Biedronka and Dino.
9. What are the rules for reporting employer collusion to UOKiK?
UOKiK allows for the anonymous reporting of employer collusion through its website. People who know about such agreements or have experienced their effects can notify the Office, which has a program for gathering information from anonymous whistleblowers.
10. What are the consequences of joint wage-setting and other working conditions?
Joint wage-setting, lowering or setting an upper wage limit, lack of raises, and setting other working conditions (e.g., the number of remote work days) are prohibited. Such actions can lead to the elimination of competition among employers, negatively affecting employees’ wages and working conditions.
