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Report: DOJ nears deal with tech firms on staff poaching
- — 17 September, 2010 22:13
The U.S. Department of Justice is nearing a settlement with technology vendors including Apple, Google and others over an investigation of their hiring practices, according to a report.
The DOJ began an investigation in June last year into an alleged agreement among technology companies not to poach one another's staff. At the time, the investigation surprised antitrust and employment law experts, who noted that there was no shortage of other antitrust problems to which the DOJ could turn its attention, and that businesses in many states could use non-compete agreements in employment contracts to prevent competitors poaching their staff.
Now the DOJ is wrapping up negotiation of a settlement with a number of the technology companies concerned by the investigation, according to The Wall Street Journal.
By agreeing a settlement, Google, Apple, Intel, Adobe Systems, Intuit and Pixar Animation could avoid appearing in court, said the report, citing people familiar with the matter.
Staff with inside knowledge of how a competitors' products are built are clearly a valuable resource. But IT vendors are often forced to collaborate with their competitors to ensure that products work well with one another, requiring a degree of trust between the companies. Agreeing not to poach staff could be one way to build that trust.
While such agreements may help technology vendors, by making it easier to retain key staff and to cooperate on product development, the reduced competition for staff is likely to make it harder for employees to negotiate salary raises.
The DOJ's investigation initially concerned many more companies, but Microsoft, IBM and Yahoo are no longer among them, the report said.
Peter Sayer covers open source software, European intellectual property legislation and general technology breaking news for IDG News Service. Send comments and news tips to Peter at firstname.lastname@example.org.