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Home World New rules on wage-fixing and poaching kick in today | CBC News

New rules on wage-fixing and poaching kick in today | CBC News

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New rules banning wage-fixing and no-poaching agreements go into effect today to crack down on companies that hurt competition at the expense of their workers.

It is now a criminal offense for two or more employers to enter into a contract to fix, maintain, reduce or control wages.

The same is true for agreements that prohibit companies from hiring or soliciting each other’s employees.

This is after the federal government amended the collusion clause in the competition law in June 2022.

Penalties for breach of wage fixation and no withdrawal provisions include imprisonment of up to 14 years and/or fines set at the discretion of the court.

This amendment applies only to agreements between unaffiliated employers. This means that such agreements between two or more legal entities controlled by the same parent company do not violate the provisions.

While the rule covers wage-fixing and non-poaching agreements between employers, whether or not they compete for the supply of products, the Bureau of Competition does not consider any arrangement between firms competing for labor. said that it plans to prioritize the execution of

Also, the new law only covers non-withdrawal clauses that are inherently interrelated. In other words, if only one company agrees not to hire employees of the other, it is not covered by the law.

New rules for price manipulation

Changes to Canada’s competition law that take effect today are not just new rules penalizing agreements between employers that fix wages and limit job mobility.

New rules aimed at cracking down on price manipulation will also come into force on Friday.

The Canadian grocery industry is under intense scrutiny due to the pandemic. (Agustin Markarian/Reuters)

Previously, companies or individuals found cooperating in fixing prices could face fines of up to $25 million per violation. From now on, however, the amount of the fine will be left to the discretion of the court, and there will be no upper limit.

That could prove pertinent as the Competition Bureau conducts a high-profile investigation into a long-standing conspiracy to artificially inflate the price of bread and other baked goods.

The agency released the first guilty plea this week by a company involved in the scheme. It turns out that the plan involved bakers and retailers working together to raise prices all at once. The collusion led to an additional $1.50 per loaf of bread rising to the price of bread for more than 15 years, according to the agency.

Canada Bread, Inc., which makes baked goods brands such as Dempsters, Stonemill and Vachon, will pay a $50 million fine for involvement in conspiracy while the company was under previous management and ownership. agreed.

Watch | How Big Bakeries Teamed Up to Boost Bread Prices:

Canadian Bread Price Fixing Scandal Unraveled | About It

Canada Bread has to pay a $50 million fine for participating in a plan to fix the price of bread in Canada for 14 years. This is the largest fine ever imposed by the Competition Bureau. Andrew Chan explains how this plan worked and why this is just the beginning.

The Competition Bureau launched an investigation after it was alerted to the existence of collusion by the bakery division of grocery giant Rob Rose and its parent company Weston. Both companies have been immune from prosecution in exchange for cooperation, but still face class action lawsuits seeking civil penalties.

When the story came to light, Rob Rose offered the client a $25 gift card as a peace offer.

The issue of anti-competitive behavior in all aspects of the grocery industry has become a top concern during the pandemic, with major giants Rob Rose, Sobeys and Metro launching a bonus program for hourly workers known as “Hero Pay.” It ended on the same day in June 2020. Prompts questions about possible collaborations.

Both companies said they acted independently before a House committee later that year, but then-President of Rob Rose, Sarah Davis, admitted to sending advance “courtesy emails” to competitors about the move.

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