Aussie tech firm Employment Hero sues recruitment giant Seek over ‘anti-competitive’ allegations

Technology company Employment Hero is suing recruitment giant Seek, claiming it has engaged in anti-competitive conduct.

Employment Hero CEO Ben Thompson. Picture: Supplied

Australian technology firm Employment Hero is suing ASX-listed recruitment giant Seek, claiming the job search platform has engaged in anti-competitive conduct.

Employment Hero, founded by Ben Thompson in 2014, offers human resources and onboarding services to more than 300,000 businesses and 2.5 million employees on its platform.

Seek is integrated with Employment Hero, allowing customers to share job ads directly to Seek via the Employment Hero platform.

Seek has provided notice to terminate its API agreement with Employment Hero, with access set to be terminated from August 25, a spokeswoman for Employment Hero said.

“Seek is a critical integration for many customers and our foremost priority is continuity and confidence for every employer,” she said.

“To this end, we have reluctantly commenced Federal Court proceedings to apply for an interim injunction with the aim of stopping the termination.

“We consider that the termination was a breach of the competition laws. As the matter is now before the court, we are unable to comment further.”

A Seek spokeswoman declined to comment on the substance of the allegations but said Seek intends to defend them.

“At a more general level we note again what we have said in many strategy presentations: Seek operates in a highly competitive market with many competitors, from multinationals to start-ups, and believes that the vibrancy of competition generates innovation that is very beneficial for all customers,” she said.

Seek, which has a market capitalisation of $8.7bn, was co-founded by brothers Paul and Andrew Bassat and Matt Rockman in 1997 and disrupted traditional print classifieds.

Seek is an investor in Employment Hero via its investment arm, the Seek Growth Fund. But it reduced its $95m stake earlier this year offloading shares to global private equity firm KKR.

Employment Hero has emerged as a competitor to Seek, which has built an artificial intelligence tool that can assess workers and find suitable jobs for them in seconds.

Employment Hero has previously lashed out at industry superannuation giant Hostplus, accusing it of anti-competitive behaviour in a submission to Treasury’s consultation on Securing Australians’ Superannuation.

Hostplus had argued that workplace management products like Employment Hero, used to onboard employees, are undermining the superannuation system.

“In particular, we remain highly concerned by instances of WMPs automating the fund selection process and designing that automated system in a manner that distorts and sidesteps the critically important selection of an appropriate fund for consumers,” the submission read.

Mr Thompson previously told The Australian that Hostplus was threatened by one of the companies it had helped become successful and was pressuring the government to shut it down.

“It’s ironic that Hostplus, which is known for investing in innovative Australian start-ups, now wants to shut down one of their own investments. Yes, Hostplus is invested in Employment Hero (via AirTree),” he said.

Employment Hero offers tools for HR, payroll and recruitment.

Both parties are expected to appear in the Federal Court on Tuesday.

Originally published as Aussie tech firm Employment Hero sues recruitment giant Seek over ‘anti-competitive’ allegations