'Slippery slope towards cartel-like conduct' in grocery wage-fixing

Grocery wage-fixing

A new report says Ottawa should amend Canada's competition laws to stop cartel-like practices and wage-fixing agreements in the country's grocery sector.

The report comes after Canada's big three grocers — Loblaw Companies Ltd., Metro Inc. and Sobeys parent company Empire Company Ltd. — all cut temporary pandemic-related pay bonuses within a day of each other last June.

The move prompted the House of Commons industry committee to hold hearings and invite senior grocery executives to explain their decisions.

The committee's report, presented in the House of Commons on Wednesday, says the food retailers admitted to communicating with each other about ending their respective wage premiums of about $2 an hour, but denied co-ordinating the termination of the pay bumps.

Yet Matthew Boswell, commissioner of competition at the Competition Bureau, testified that competitors communicating about wages at the executive level risks "a slippery slope towards cartel-like conduct."

But he told the committee that the bureau lacks the power under the Competition Act to prosecute such behaviour and faced significant resource constraints.

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