I have personally witnessed the frustrating side of this "no poaching" pact. A close friend was tired of the "Manager Arrogance" at one of these colluding companies.
He quietly put out the word,pretty quickly got approached by a hiring manager at another company - things were going swimmingly.
Then the Hiring manager put in the Req to HR - a V.P. called him personally and but confirmed this "no poaching" B.S.
The wage hike would have been considerable for my friend (you can guess the two companies - Arrogant vs Top Payer) & he was pretty upset to learn that the real reason was Jobs being a Huge Asshole and bullying everybody into such a blatantly illegal pact.
So this is a very real "wage theft" collusion case.
Unfortunately most of the parties involved had the "good" sense to NOT document it officially so the Smoking Gun might be hard to prove conclusively.
There was even a "no hire" list at one of these companies tacked on the wall of a HR Manager with the Caption "If you hire from there, we will fire (u) from here."
The CIPD and other HR regulating bodies need to permanently disbar any member found guilty of this. and for HR directors the the Judge should name them as "not fit and proper persons to be a director" and probably the CEO on Chairman for good measure.
Of course if the Hr director turned states evidence they might be let off with a slap on the wrist.
The CIPD is in the UK. The closest thing in the US is SHRM, which has the PHR/SPHR designations -- which are indeed often a requirement for senior HR positions (though I don't know that those designations have ever actually been revoked.)
I guess it is risky. Many people see finding next job before leaving previous one as the responsible thing to do. Especially if you live in an expensive location or have family or other financial obligations that simply needs to be paid.
Technically, you can find "temporary" job in smaller company and then move to the company you "really" want to work in. It just seem to me somewhat jerk move toward that smaller company.
Back in AT&T around 2005-2006 a "change of guard" occurred and a very technical team supporting SAP systems lost about half their staff to HP within 3 months. Rumor has it that at&t upper-management had a conversation with HP and a few other people who wanted to go had the door shut in their face.
I know of at least one person who had to quit her job... wait 2 weeks... then HP picked her up. Risky indeed if HP couldn't make good on their promise, but it worked that time.
A strike involves work stoppage, it's a very different tactic than mass resignation.
In 1999, Major League Umpires Association (MLUA) were not able to legally go strike so they opted to use mass resignation as their negotiation strategy. It backfired, cost 22 umpires their careers and led to decertification of the union.
Sickouts are commonly illegal. Though it is usually impossible to punish the individuals for calling in sick, an organization that promotes it - such as union - may suffer consequences, and organizing such thing may be a firing offense.
If you fall into this group and want to file a claim to be part of the settlement, you have until March 19th to do so (which you can do via the above website).
I'm really glad to see that this issue is getting more coverage in the mainstream press. There was an article/editorial a while back (discussed on HN) from the guardian, but unfortunately, the writer used the incident (the collusion) to go on a rant about how valley leaders are hypocritical libertarians. That (reasonably enough) lead to a long debate about whether the leaders are libertarians even if they are mainly democrats, etc...
This article stuck to the point much better. I do think Mr Levy (quoted in this article) went a little far in suggesting that the engineers are a very well heeled class.
"Santa Clara County, in the heart of Silicon Valley, has the highest average wage in the country,” said Stephen Levy, senior economist at the Center for Continuing Study of the California Economy. “San Francisco and San Mateo are not far behind. It would be a mistake to think of these plaintiffs as an oppressed set of victims."
Agreed, programmers in the bay area aren't dust bowl refugees. However, we need to recognize that the relatively high salaries don't go far in high cost regions (where many of these companies are located), and aren't that high relative to the higher wages typical of these regions.
Application developers in SF earn, on average, a tiny bit less than RNs and a whisker more than dental hygienists (links at end). I'm 100% ok with good wages for nurses and dental hygienists, but keep in mind that these tech companies have been almost frantically lobbying congress to do something about a severe shortage of highly educated programmers and engineers.
Well, first and foremost, how about you stop colluding to suppress their wages? That might attract a few more people into the field.
It's certainly not the case that IT people are hurting terribly but it makes it hard to argue that there is in fact a significant shortage or that we need programs to attract more CS majors rather than, say, simply paying at least as much as some of the other things students choose to major in.
Is there indeed a shortage of app developers because of the low wages? I was always thinking of software as a segment where entry barriers are relatively low - compared to, say, medicine - and pay is exceptionally good. Of course, everybody wants to be paid better, but it doesn't look like software engineers are suffering especially badly from low pay.
People (including me) often say that barriers to entry are low, but I think it's a bit more complicated than that. There are no legal barriers to entry. But barriers to being a "mathematician" are also low. But would you say that the barriers to doing meaningful mathematical work are low? It's out of reach of most of the population.
Anyone can hang out a shingle as a software developer, but are the barriers to getting through the technical grilling typical of a software interview process really low? Just because there are no legal barriers doesn't mean that it's an easy thing to learn.
I don't think that software engineers are suffering from bad pay, but is the pay high enough that it makes sense to be talking about a severe shortage that the government should start fixing? Based on pay, I'd say we should take the "software developer" shortage about as seriously as we take the "dental hygenist" shortage.
The thing is, anyone who has read, say the Django tutorial can say "I have done Django developemnt", whereas that is a world of difference from having a solid understanding of database design and deep understanding of all parts of the framework and able to set up such an app on various different servers.
Interviews in IT seem to be a mess, though looking at what I have been asked in the past few years. Pointless trivial pursuit sytle Python questions and the likes.
I'd say definitely lower than RN. Not to mention all kinds of certifications that can be expensive and time-consuming too. Great software engineers are rare, but common ones are nowhere near the level you need to be to make a significant contribution to math field. And the pay is much better.
Most of the developers I've met from the companies mentioned have masters or phds as well as substantial work experience on real-world projects. Those that don't are usually exceptional individuals.
You have very biased view of the industry then, probably because of the specifics of your social circle. Absolute majority of tech industry doesn't have PhDs and does work that in no way, form or manner requires PhD.
> It also offers a portrait of Silicon Valley engineers that differs sharply from their current caricature as well-paid villains who are driving up the price of real estate in San Francisco and making the city unbearable for others.
What? "unbearable"? That seems a little out of place. Would most NYTimes readers have any idea what he's talking about?
From the author's recent articles list:
--
In little more than a decade, Google has become essential and omnipresent. Now the question is whether people will start to resent and oppose it.
--
As entrepreneurs invade regulated industries and evade traditional watchdogs, the question of who is responsible when something goes wrong looms large.
--
Airbnb likes to say that it gives more people the money they need to pay their bills. But new research suggests that as the sharing industry spreads, more people are going to need that money, because they’ll be unemployed.
--
Uber and a Child's Death
--
Hard-hit by recession, many in Europe have questioned whether jobs at Amazon’s warehouses there are good for the economy or dehumanizing.
--
seems to exclusively write negative stories about bay area tech
We could use a bit more self-reflection and a little less shooting the messenger around here.
If you only want to read happy happy joy, disruption yeah, cheerleader stories about how awesome the tech industry is, I suggest TechCrunch.
Our industry has a pervading attitude of treating anybody who is not "us" as roadkill on the highway to progress. That's going to turn against us a lot harder then these few relatively mild articles.
Exactly. The tech-industry is horribly naive. It operates based on the idea that the general public perceives them as those friendly shy nerdy guys from school.
Wake up, guys. People have had tech giants invade their life way too much and they've all seen in The Social Network what kind of person a poster boy like Mark Zuckerberg really is.
And when they need a scapegoat for the rescission they look around and think ok we bullied them in school with no come back and they are crap a lobbying as a group so lets go to town on techies.
Its the "Anti globalization of fools" want to rile up your nice political machine just go "techie techie techie" any one get the reference to the infamous political observation I am making here.
>we bullied them in school with no come back and they are crap a lobbying as a group so lets go to town on techies.
This motivation is not sufficiently acknowledged on HN. I think people are afraid to face up to this fact. A lot of what feminists say about rape culture is true, and similar observations apply to nerds. Our culture trivializes physical and sexual (wedgies) assault on nerds. It is only natural that this same culture put on a front of false outrage when some nerds earn a good living.
> Wake up, guys. People have had tech giants invade their life way too much and they've all seen in The Social Network what kind of person a poster boy like Mark Zuckerberg really is.
The Social Network is heavily dramatized, and not really realistic. You shouldn't take a Hollywood movie as reference for real-life. IMHO, the way they depicted MZ in the movie is completely off (spoiled arrogant ass-hole), that's not what he is like in real life.
Yeah, when I want to learn why some startup failed or the reality of some tech, I don't listen much to the public tech world. I have to reach out to people and probe to get a better picture. Because then they won't be so busy applying spin for public consumption.
Like recently, there was some article here about a failed startup, and it felt like most of the discussion was pointless. Killing time of people's lives for no end. Because I knew people at the company, and there was such massive dysfunction which severely cut the chances of success regardless of virtually any other factor. I mean really goofy, where elements should be on a sitcom.
Or when you read about some tech which "everyone uses", and there's fundamental issues with it which inevitably bite people hard when they actually try to apply the thing, but everyone's like rah-rah.
"In 2013, Mr. Streitfeld was part of the team awarded the Pulitzer Prize for Explanatory Reporting “for its penetrating look into business practices by Apple and other technology companies that illustrates the darker side of a changing global economy for workers and consumers."
yeah it's CP Snows Two nations repeating its self - Arts Grads vs the oily engineers.
Some of his angst is that as a child of a major columnist in a broadsheet he feels that he should have a proper job on a proper news paper which in previous generations he woudl have stood a good chance of like say Polly Toynbee on the Guardian.
Due to the decimation of the traditional print media he can't get a nice job on the NYT as a columnist and has to slum it in a tabloid and they are using typical tabloid "monstering" techniques
Some people, myself included, find fault often (too often) and look for the flaws. Assuming the worst leads to pleasant surprises. Assuming the best rarely does. My 2c.
This case is a beautiful demonstration of the dynamics of both "free market" and regulation. Free market dynamics demand (in this case as in all cases) that large players must never compete on prices or wages (as your competitors have the resources to fight back, so competition on price just makes everyone worse off). On the other hand, regulation was used both to stop an exploitation by the market (antitrust), as well as a tool wielded by capitalists to strengthen their stranglehold (patents).
It is perhaps worth reminding that the interplay between regulators and the market, and their co-evolution, have taken a different historical path than in Europe. While in Europe big government preceded laissez-faire, or at least, evolved hand-in-hand, the US was largely unregulated for many years. The result was that Ayn Randian titans took control of pretty much all power in the US, advancing the "economy" but at the same time practically enslaving the population. It was after many years of cries for help by the American people, and a long struggle led largely by the press, that Teddy Roosevelt was able to strengthen the government, wrestle back some power, and save the people from feudalist oppression.
Ironically, many Americans forgot what the US looked like when the government was powerless, and the market was allowed to roam free. People like Ayn Rand, who sadly came to the US just as the wheel was turning, didn't see the suffering that their romantic fantasies had brought about when playing out in the real world.
Obviously, as patent law demonstrates, regulation can be (and is) abused by capitalists. As the world changes, power shifts, and players adapt new strategies in this constant power struggle, both the market and regulation need to evolve hand-on-hand. The big question is what will play the role the press once played in exposing the workings of the intricate system of interests that is the economy?
" On the other hand, regulation was used both to stop an exploitation by the market "
I don't see any evidence that regulation stopped the behavior in this case. Perhaps the law will be used after the fact to sue or jail some people, but it doesn't seem to be what actually stopped the problem.
As another poster said, the class action date ranges end in 2009 because Facebook (a private company) wouldn't play ball.
Capitalism is a messy system, but it does tend to self correct in the long run.
The practice stopped because of an agreement reached with the Justice Department[1]. I don't know which theoretical model leads you to believe that capitalism tends to correct itself, as historical evidence suggests otherwise: that the free market tends to converge towards feudalism (in the broad sense) – as happened in the US in the late 19th and early 20th century – or crisis; any corrections in course have always been due to public uproar which led to increased regulation.
You are right. My statement is a huge generalization and I will never be able to find hard supporting evidence in the true sense.
However, my general sentiment stems from looking at the well being of the average person across human history. As humans shifted towards a system where people earned for themselves and kept what they earned, the typical human life improved at an astounding rate. On a much smaller scale, I've never seen people work harder than when they had stake in the outcome.
Anecdotes and generalizations, I fully admit. However, I bet many others with a much wider variety of life experiences than I have reach the same conclusion.
Actually, human society hasn't "shifted towards a system where people earned for themselves and kept what they earned". Throughout history there have been motions back and forth towards a amore socialist or a more capitalist system. In fact, I'm not sure you can say that we have such a system in any of the Western countries, right now. People don't just work for themselves: they pool a large chunk of their resources together to build common infrastructure necessary for business.
There was one time, however, when human society shifted from a communal hunter-gatherer society to one having private property, and that was the neolithic revolution. It is pretty much universally agreed that it made most people worse off. They had to work more (you're right about that; hunters-gatherers needed to work only 20 hours a week), got more sick, were malnourished, had to give birth to more children, and lived less (until modern technology, that is). It's unclear why this most important revolution in human history happened, but some theories suggest that it was brought about by the only people who benefitted from it: those who quickly became rich.
> Ayn Randian titans took control of pretty much all power ... after many years of cries ... Teddy Roosevelt was able to strengthen the government ... People like Ayn Rand, who sadly came to the US just as the wheel was turning, didn't see the suffering that their romantic fantasies had brought about
I know this is HN, but maybe you should try to comprehend the message as it was obviously meant instead of choosing a possible interpretation that is illogical and then beating up on the interpretation you chose.
I got the original message (or at least the beginnings of one).
OP started off on the narrow path of understanding with balancing viewpoints, but then fell off by representing Rand as unconditional support for corporate domination, and went on to imply that her writings inspired these before-her-time titans to boot. So I pointed out the absurdity by expanding on it.
Besides what's really more interesting, analyzing caricatures of ideologies, or time machines?
Only if you're talking about a narrow caricature of her ideas, and ignoring the context she was writing from - socially-based totalitarianism. Her focus of strong individualism would have manifested quite differently if she had been writing during that period of hierarchical totalitarianism.
There are many people who use what she said to justify their being assholes, but the same applies to any philosophy when it's taken for strict prescriptions.
If large players routinely pay top specialists low wages, they will cease to be large pretty soon, since their talent will be leaving for players paying better money and making those players large instead. Some people, of course, are impatient and want their enormous wage to be even more enormous - and now! And they want it while carrying no risk at all. That's where politicians come in - delivering other people's money while moving risk to somebody else is their specialty. Of course, their primary clientele is the same large players, but minor politicians are not above serving smaller audiences and endorsing extensive and complex regulations that would cost large players a tiny bit of their profits while making compliance so hard that smaller players would find it very expensive to compete. Which is all for good, so politicians can proceed with their good work. At the end, everybody wins - impatient people get a tiny bit of cash from large players, lawyers get a huge pile of cash from large players for managing the lawsuits, large players get higher barriers to entry, politicians get votes for restoring the order and everything is great because nobody ever asks where the money comes from.
You say they will cease to be large, and "pretty soon" at that. You accuse employees of being impatient. But this collusion lasted for nearly five years.
Besides, how can their talent leave for players paying better money when nobody except for the large players can afford top wages? Just because Google can extract $150k+ of yearly value out of an engineer doesn't mean another company can. You need a large, successful business for that...
Five years is not a very long time for a company, and it assumes this collusion actually suppressed wages in a meaningful way, compared to the rest of the industry, which is yet to be proven.
>>> Besides, how can their talent leave for players paying better money when nobody except for the large players can afford top wages?
If their wages are so high already as to be unaffordable for most of the industry, it significantly deducts from my sympathy about them being oppressed by wage-suppressing large companies. To both have wages that nobody except very few very rich players can pay and then complain their wages should actually be even higher and are artificially and illegally low seems to me a bit greedy, not?
>>> Just because Google can extract $150k+ of value out of an engineer doesn't mean another company can.
Another company then sucks at what it is doing if it can't extract value efficiently. But experience shows new players routinely come out to disrupt existing ones. But if Google is able to both extract huge value and pay huge wages - unattainable anywhere else - what exactly is the complaint about? That these wages aren't huge enough yet and could be even huger?
Five years is not a very long time for a company, but for an individual? Especially in an industry that exhibits ageism and by some accounts is "done with you" when you turn 40? Given that, five years is more than 25% of the time in which you are hot on the market. So, no, I don't really think someone who has been shafted for five years is being "impatient". Just how long do you expect them to wait?
Where that 40 thing comes from? Maybe it was true 20 years ago when 40 years old meant no extensive experience with modern computing, but by now it's plain stupid to refuse to hire experienced developers in their 40s. Sergey Brin is 40, Larry Page is 40 - are they really "too old" now? I think this ageism thing is going to die very soon, if it already didn't.
>>> Just how long do you expect them to wait?
That depends on what you're waiting for. I was talking about economic processes, they don't happen overnight. If you want to improve your personal situation, you don't have to wait for that.
My observation of discussions on HN about age discrimination. (I'm not a software engineer, so I have no personal touch with that job market)
If you want to improve your personal situation, you don't have to wait for that.
When the top employers are actively colluding against you, maybe yes, you do. You have no power against a company worth $400B, unless you band together with your peers. Perhaps in some kind of legal action...?
You don't have to work in a company that is worth $400B. Of course, this company may pay the best, far over what other companies do - but then your complaints about your wage being artificially suppressed sound a lot like pure greed.
The problem isn't when one company pays better than everybody else. The problem is when the top ten different companies, all of which you would like to work for and all of which pay the best, agree with eachother that none of them will pay you what you are worth.
Now, I think you already understand that, and your counter was "well then someone will hop in and pay you what you are worth and they will suffer for colluding". But clearly that hasn't happened.
Seriously, the fact that the word "collude" can even be used here is a bad sign. If you pay attention to business history, that word is never good.
It doesn't matter if it's one company or 10 companies out of 1000. The claim is most companies - overwhelming majority, as it appears - can't pay you this money. Still you think you're worth more than any other company except 10 can afford to pay, and despite being paid obviously in the highest in the industry, you think you're worth much more. That's OK, overwhelming majority of people think they are way above average in everything they do. But you don't stop there - you think that any effort for the companies to pay you less than your imagined self-worth is illegal, despite the fact that you voluntarily agreed to be paid as much and nobody else but these tiny minority of companies would even consider to pay you this much - you still think they owe you more and need to be coerced to pay you more. I'm sorry, I don't see how this can elicit any sympathy from me.
>>> But clearly that hasn't happened.
How you know that? The salaries in the industry are one of the highest of any, and compared to the effort needed to enter the industry (compare to, say, lawyers or doctors and how much you have to spend in time and money to become one) is even higher, probably one of the best among all (legal) industries, especially if you take out salaries that are achieved by political gamesmanship and not by market forces.
>>> Seriously, the fact that the word "collude" can even be used here is a bad sign. If you pay attention to business history, that word is never good.
If you argue on the grounds "I used this word, and this word sounds bad, ergo the thing I've named with this word is bad by the fact of the word sounding bad" - you lost the argument. Unless you think words are magic and the mere fact of calling it "collusion" automatically and magically taints it.
So basically you only argument why it is bad is "because it's illegal". There are lots of things that are or were illegal just because it serves some particular special interest or just because some lawmakers are doing really stupid things (I could spend half an hour here naming them but I'm sure a list not shorter than mine just popped into your head). So the most you can claim that special interest you're aligned with has upper hand in this particular case. Somehow, again, it doesn't add to my sympathy - there are already too many people that are extracting money primarily by lawmaking and lobbying, joining them is not exactly the best thing for the industry. So far no cogent argument of why these people need special protection of their interests has been presented, and the only argument presented - "we can win in court" - smells pretty bad in my opinion.
>>> it's seeking damages for the companies allegedly doing something illegal to pay them less.
Same thing. They couldn't extract money (in addition to huge money they did extract) by voluntary negotiation, so they extract it by coercion. When it is being done is a technical detail.
Bureaucracy is annoying, slow, and unjust. But the situation now is much better than when the market was unregulated and robber barons did as they pleased. The American people suffered under the tyranny of the free market, they called on the government to save them, and it did. Nothing is perfect, and everything requires constant work and improvement, but we can use a gentle reminder now and then of how things used to be.
I don't think anyone believes Silicon Valley engineers are a bunch of miserable, oppressed working-class folk, but it's good to know how even the most seemingly progressive of corporations behave.
As to "making compliance so hard that smaller players would find it very expensive to compete", I think that regulation sometimes swings this way, but it is sometimes gradually, slowly, fixed. I don't think anyone would say that all regulation is always good for the big players and bad for the small ones.
>>> I think that regulation sometimes swings this way, but it is sometimes gradually, slowly, fixed
The first sometimes is more like "almost always" and the second one is more like "almost never". Government regulation is a ratchet - easy to move one way, almost impossible to move the opposite way.
>>> Lastly, where does the money come from?
That, as I said, the question that is never asked. Because everybody feels entitled to have the money, nobody ever asks who's paying the money. Consumers? Shareholders? Taxpayers? Who cares.
Do you think that without regulation there will be less barriers for the small players? Because I can assure you that the Robber Barons made sure there were no small players left. They either bought them out or forcefully drove them out of business. As much as regulation places a burden on the small guys, if you let the big guys alone at it, they will make it much harder. This isn't theoretical; that's how it actually happened (and if the US 100 years ago is too far back for you, look at Russia in the past 20 years).
Russia in the past 20 years is an example of a libertarian no-regulation state? Are you kidding me? Russia is a corruptocrat authoritarian state with no independent courts, virtually no independent media outside of internet, no rule of law or personal protection of property and person, official state censorship, and is corrupt to the core, with rampant extortion and bribery on every level of the government. And yes, plenty of invasive regulation that is used exactly to extort these bribes. Latest state initiative, recently introduced into Duma, is mandatory registration with the state of every internet site and mandatory preservation of users' activity logs by every site operator:
http://lenta.ru/news/2014/02/28/data/
I'm sorry, did you just mention Russia as an example of state with no regulation? Ignorant, joking or trolling?
This is really pathetic. I can understand companies being ruthless in maximizing their profits but this sort of move is seriously counter productive. If the wages are not competitive it also means less incentive for bright youngsters to get into these professions. If this kind of agreements become more common, I think that will be like we killing our future.
Companies do not, usually, plan decades ahead. They manage the next quarter and plan the next three years. Youngsters entering or not a professional area is something that takes 20 years to produce a measurable effect.
Government, is the one that should do the multi decade planning.
Except it never does. All those decade-long budgets and long-term plans are a sham that survives in the best case until next 2 year election, but more commonly till the next budget skirmish that happens once a couple of months. Specific people can have long-term agenda but government as a whole is incapable of that.
"I am from government and I am here to help" you can only shudder at those words irrespective of the context.
I will be surprised to see if Google or its investors do not care about their long term future. I will be less surprised to see someone like Obama planning only for re-elections and short term popularity ratings.
Engineers are so highly underpaid for the value they contribute to these companies. What's the average salary, $140k? It should be $300k, half a million total comp conservatively. Even at that amount, employers would still be getting a 50-75% margin on you. It's insane how much we are ripped off. Good eningeers can literally make or save companies 10s of millions a year, but are never compensated for it.
As with earlier numbers: sounds like it should be enough for anybody, but I can think of a number of other companies which have been excluded from the suit which should be included. Cisco comes to mind.
Can Software Engineers in California that weren't working at one of these companies get in on this class action? I mean even if you weren't at one of those companies its easy to see how suppressing wages at the largest companies would suppress wages for the entire industry.
The sad part is that even though this behavior is illegal, no one will actually go to jail for this. Companies will pay a token fine (like Pixar and Lucasfilm did), and it'll be business as usual, but this time no emails and no documentation.
Unless a few people end up in jail for this, nothing will change.
> Unless a few people end up in jail for this, nothing will change.
That's pretty much it. Does the govt come down on corporations for such acts? One rarely sees corporate honchos being jailed for such incidents. More often than not, it is a fine and then things move on to find and execute a different loophole.
I'm still surprised Google was in on this considering they are developer friendly and are a "do-no-evil" company to a considerable extent. It was probably pressure from Jobs. Developers hurt by this should squeeze them for every penny possible.
Google is no more a "do-no-evil" company than most. They might be slightly above average. Their "employee friendliness", as far as it goes, is blatantly self-serving, designed to create extreme allegiance to the company and possibly long working-hours. This is not in itself "bad", it's just that it isn't altruistic in the slightest, either.
What you have described is Google's "brand image". It is carefully cultivated through PR and marketing to result in you having a positive impression of Google. You could uncharitably call it propaganda.
Google is pretty good at promoting this image, but that's all it is.
This is bound to happen in any industry where supply of talent exceeds demand AND the powers-that-be can get away with collusion (either by virtue of being 'private' or simply being powerful and thus not give a shit).
So what if one talented employee decided to quit one crappy company 'A' AND is unable to find work at the non-poach pact company 'B'? The place he quit will always find another willing sucker 'coz the supply is ever present (with, at most, a minor reduction in quality).
When supply exceeds demand, you do not need collusion, because there are unemployed workers who you can just hire at your target rate. If that is not enough money to entice them to work for you, then it would still not be enough even if you colluded.
What collusion allows is for the employers to maintain these low prices, even when demand exceed supply.
The drive to maximize profit by those in the executive suite has caused them to do some seemingly clever (according to those in power) things but are in fact stupid in the long term.
A few years ago I overheard a new senior programmer argue with the cfo why developers should get 2 big monitors instead of a small 19". The cfo initially refused to go along. Of course some of it was due to his desire to keep cost down, as every good cfo should. But then he joked every dollar saved would mean more for his christmas bonus. we were a small/friendly company so I guess that's why he felt it was ok to joke about it. But I do believe his ultimate reason was to keep cost down at any 'cost' so that his bonus check would be bigger, as his performance is evaluated on how he manages the cash flow.
What the cfo didn't see was the productivity gain that could be gained by the programmers having bigger monitors. And these programmers were making near 6-figure salary. Their combined man hour cost was greater than his. But a cfo was making a decision to fatten his bonus check. Obviously this was not a good choice for the firm to make but it had been going on for awhile until the new senior programmer spoke up.
And I think this kind of logic in executive suite is probably common everywhere.
Lastly, I think it's about time these big tech companies add profit sharing ON top of the base salary as part of the compensation package. Why should an executive make SO much more than master and phds who are adding real value to the company?
Wouldn't a better idea than putting up a 'no poaching' kind of exit barrier be to give 'bonus every X period of time' kind of incentive, for employees you value and would like to retain?
I wonder if in the world of technology it makes sense to retain a demotivated employee?
> I wonder if in the world of technology it makes sense to retain a demotivated employee?
It absolutely does. The nature of tech work practically demands that every employee develop intimate knowledge of the very specific domain his work touches. It takes so long for new hires to become productive that in most cases the bottom line begs you to hold on to anyone who already has that intimate knowledge.
On the other hand, keeping a tech employee motivated often looks like a fool's game to management. If he's good at what he does, he doesn't see the world the same way as they do. If you're a growth-oriented engineer, it makes sense for you to bounce around different companies so as to maintain a sense of movement and there's not much your employer can do to "maintain your sense of movement" because it's a completely alien concept to them and often presents as "unnecessary shit that will cost time and money and be risky". Your career goals will often clash hard against your company's needs.
End result? This situation where top talent sinks collude to reduce their engineers' inherent negotiating advantage. This practice would be widespread, if only technology weren't such a wide field that any engineer with any desire at all for something better can very quickly find something. It only happened at the top level because that's the only circle in which there is no more upward mobility except among the same cloistered few.
Arguably this helped startups, since an ex Apple guy who couldn't go to Google could found a startup (and then maybe sell to Google later). Still lame though.
Serious question - will this do much? Seems like in the case of a win, the companies will give token amounts (9MM from Pixar for example) and the claimants (given there are 64000) will get a tiny little check.
Am I missing something? Is this worth pursuing for a prospective claimant?
OK, so you can stop the "no poaching" and you'll have:
--> smaller than they should be engineer wages --> higher engineer wages --> even higher engineer wages -->
...
--> absurdly high unsustainable engineer wages -->
...
--> more outsourcing --> even more outsourcing -->
...
--> massive outsourcing -->
...
...
...
--> smaller than they should be engineer wages
...I think the "evil masters" of this "no poaching" pact managed to prevent an engineers' job marked fluctuation. And you think about it, such a fluctuation would only have benefited the foreign outsourcing providers and encouraged the displacement of parts of tech industry outside US ...which imho would've have been a great thing for Europe's tech sector and maybe even for worldwide IT innovation as a whole, since lots of new pseudo-innovations start to sound more and more like "american-inbread ideas".
Engineers wouldn't price themselves so high that they would be outsourced: that only happens to people who don't have any room left to let their wages fall, either because they already earn too little to sustain themselves or there is a legal price floor (e.g., minimum wage). An engineer making $200k isn't going to starve from taking a 50% pay cut, and they'd certainly rather take that than no job at all.
What can the villains in this drama use as power to force their illegal price fixing on reluctant companies?
Just what you'd expect.
"Mr. Jobs proposed a no-poaching deal to Edward T. Colligan, Palm’s chief executive. Mr. Colligan responded that such a deal would be unfair to employees as well as “likely illegal.” Mr. Jobs then threatened to unleash Apple’s patent lawyers on Palm."
Yep. It's our badly broken patent system yet again.
Interesting, since most of Palm's ideas on smartphones pre-dated the iPhone. No wonder we've changed the patent law to first to file, rather than first to invent.
This is the reason that tech companies seek to acquire large rather than technically sound patent portfolios.
Briefly: defense against infringement runs around $1-$10 million per patent )(it may be higher, my information's somewhat dated). Defeat one patent, and the company with the larger portfolio presses suit with another, and another. Even if the plaintiff successfully defends itself against these suits, it's still out $1-$10 million per patent. Often far better to strike a licensing deal for $40k (or some value less than $1-$10m).
It's possible to countersue, and this happens, usually with the result that the companies reach a cross-licensing arrangement.
"does the defending party get their legal fees reimbursed by the suing party?"
Almost never.
The law requires "exceptional circumstances" for an award of attorney fees and the CAFC (the patent appeals court) is inclined to reverse even fees awarded under those circumstances.
There were two cases argued at the Supreme Court this week to try to define what constitutes "exceptional" and reduce the authority of the CAFC to weaken the awards. [0] The court isn't expected to change much.
There is a bill in Congress that has passed the House and is being considered by the Senate [1] which would change the rule to award fees by default "unless the court finds that the position and conduct of the nonprevailing party or parties were reasonably justified in law and fact."
So plenty of people even in languid Washington are frustrated with the current lack of fee shifting. Maybe something will be done. Maybe not. Washington is not famous for swiftness or wisdom.
That depends. One of the problems, again, is that the process can take its sweet time to happen, and there's always a risk involved. Your legal team needs to be paid up-front, generally, which means that in terms of financial capital you're allocating your resources in advance, and have that much less to contribute to real business investment.
Other than that -- I'm wading in above my head, so I'll let someone more qualified respond at more length.
I agree that the biggest liability to the economy at large of huge patent portfolios, little seen so far, is the ability of multiple incumbent corporations to collude and increase barriers to entry so they collectively are not threatened by innovation from upstarts.
That said, most of the time that Palm (and Handspring etc.) devices existed, they were PDAs, and the reason Palm beat out Apple's Newton is probably that they chose a subset of functionality that was more modest and probably more appropriate to the hardware of the time.
For example, while Newton's handwriting recognition was often unreliable, Palm devices asked its users to use a an arcane script that was easier to process. (Later lost in a patent-related issue, if I remember correctly)
Probably someone here was actually involved in the history of developing the devices, but as I remember it, the revolution of Palm pilots and other models was that they worked more smoothly, and they synced more reliably with your computer than any competitors. That involves a lot of good engineering and attention to detail, but it does not necessarily mean that there can't still be overlaps with patents held by companies which invented something earlier but with an implementation that didn't win over enough customers to survive.
part of the story that is forgotten..there is a specific part of software in the mobile OS that Palm invented and patented and than gave that patent away for free to anyone who wanted to use it..if you are a mobile OS geek you know piece I am talking about
Yeah definitely its a 1st-world problem. But in context, there's more money and value being squandered in Silicon Valley due to this crime, than if it occurred in many other areas.
This is the 99% lead charge that annoys me the most. (especially since many of the people leading it aren't 99%'ers they just think they are)
The assumption is that the only places to work are the big companies. Anti-Poaching agreements are rarely about the Money and more about the "I won't steal your trade secrets if you don't steal mine" types of "we can't patent this stuff" stand offs.
It is also protection against having a company put another company out of business by "poaching".
You look at some of the teams at companies and you can see where a group of 10 guys went from company to company. When they all left most the time that company failed. You can't withstand a blow of having 40% of your team walk, and take everything they were working on to a larger competing company.
"Salary Fixing" doesn't work. Someone always offers 15% more to get better talent and when that eats in to the talent pool everyone else has to ante up as well.
Silicon Valley just feels entitled. Yeah it costs more to live there, but the expendable income of SV engineers is vast compared to engineers anywhere else in the US, and the world.
A BART "train driver" is responsible for the lives of hundreds at a time. Attended school, and takes ongoing continuing education classes to maintain their license. They compete for a few hundred jobs in the US and if they don't get or keep that job there is no competition locally to transfer to.
That "SV Engineers feel entitled" thing I said. You just demonstrated it.
I am not saying that BART or LU Drivers are overpaid - but that the average SV programmer or London developer is not overpaid when compared to them - techies are not very good at organizing collectively.
Name me one SV tech company that has a final salary pension open to new joiners.
And sorry 95% of the safety is in the TPS system and I would probably bet that the EE's that design and look after that system for London Underground are not paid £60k plus overtime
He quietly put out the word,pretty quickly got approached by a hiring manager at another company - things were going swimmingly.
Then the Hiring manager put in the Req to HR - a V.P. called him personally and but confirmed this "no poaching" B.S. The wage hike would have been considerable for my friend (you can guess the two companies - Arrogant vs Top Payer) & he was pretty upset to learn that the real reason was Jobs being a Huge Asshole and bullying everybody into such a blatantly illegal pact.
So this is a very real "wage theft" collusion case. Unfortunately most of the parties involved had the "good" sense to NOT document it officially so the Smoking Gun might be hard to prove conclusively.
There was even a "no hire" list at one of these companies tacked on the wall of a HR Manager with the Caption "If you hire from there, we will fire (u) from here."