Six recruitment agencies have been fined almost £40million for price fixing.
The consumer watchdog, The Office of Fair Trading, said it had imposed the sanction after a lengthy investigation.
They said the six recruitment agencies had colluded not to undertake any contracts with ParcUK, a firm which acted as an intermediary between recruiters and construction firms, putting pressure on the margins of recruitment firms.
“Instead of competing with Parc – and each other – on price and quality, the parties formed a cartel,” the OFT said.
It added that the six recruiters, who met five times between 2004 and 2006, agreed to boycott Parc and fix rates they would charge to construction companies. Their actions violated the Competition Act of 1998, the OFT said.
Hays Specialist Recruitment, a unit of Hays, was penalised £30.4m, the highest fine. CDI AndersElite, a unit of CDI Corp, was fined £7.6m.
Private companies Eden Brown, Fusion People, A Warwick Associates Ltd, and Henry Recruitment also received penalties.
Two other recruitment agencies involved were granted immunity from fines because they exposed the cartel, the OFT said, and most of those fined were given discounts for leniency.
“This is a serious breach of competition law and the level of fines reflects this,” Heather Clayton, the OFT’s Senior Director, said in a statement.
“Ultimately it is the consumer and the wider economy that loses out from such behaviour.”
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