> Meg called to talk about our hiring practices. Here is what she said. Google is the talk of the valley because we are driving salaries up across the board. Then Eric Schmidt says: > I would prefer Omid do it verbally since I don't want to create a paper trail over which we can be sued later

So Silicon Valley execs were illegally conspiring to drive down wages, and who knows how much more was done outside of the paper trail mentioned.

Then we have an article discussion yesterday and blog posts etc. in the past few weeks about how companies can't find great engineers, and how we need immigration law changes that blocks Mexicans etc. but brings in more engineers to drive down engineer wages etc.

Maybe if CEO's weren't illegally conspiring to drive wages below their market value, there wouldn't be a so-called "engineer shortage"?

I mean it's risible. They conspire illegally to drive down wages, then whine that not enough people want to work in this field where wages have been artificially and illegally deflated.

This is appalling to read, and it's frightening how blasé they are about blatantly illegal and unethical non-competition. Yet, I think the article misrepresents Schmidt firing the recruiter:

>Here, Schmidt relates a phone call he had with eBay CEO Meg Whitman and then orders his own recruiter to be fired because that person tried to poach the COO of eBay.

Reading the email, it doesn't seem like the recruiter was fired for trying to poach the COO; it seem like he was fired for lying to the target about the position (as Schmidt calls them, "falsehoods"). Don't forget recruiters usually get a significant finder's fee, and are not above misrepresenting a position to generate interest.

Ah... So it was always "Be Evil" and fuck over your employees. It always amazes me that these people love free markets, until it's expensive and then they break the law deliberately to pay slightly less than the fair market price to the best and brightest.

Effectively stealing from their employees to give to their shareholders just blows my mind.

Just gonna throw my perspective out there, since I was a firsthand witness to this stuff.

I started at Google in 2005 as an ordinary software engineer, and I've not yet left them. Back then, Google recruiters were constantly bugging employees for referrals. But this "no poaching" thing wasn't some weird dirty secret among execs -- it was just sort of a common knowledge thing, and nobody seemed to think it was a big deal. "Oh, we have a gentleman's agreement with Apple not to poach them and vice versa -- so give us the names of your friends to reach out to, but not if they already work at Apple."

AFAICT, the reason I (and my coworkers) never thought of this policy as illegal is probably for two reasons:

1. Hey, poaching back and forth would create a lot of disruption and churn and mess up both companies' ability to get things done. Let's not start a pointless war.

2. We, as programmers, are ridiculously overpaid already. How could anyone possibly be "taking advantage" of us at these salaries? The notion seemed as absurd as a Programmer's Labor Union!

Again, the idea was not to poach, not to avoid hiring. If somebody from Apple applied for a Google job of their own will, that was fine.

In hindsight, I /guess/ I understand how this looks like evil collusion to keep salaries down... but really it seemed like common sense and civility at the time. At least that's how it was sold to us. It was sort of like the nuclear policy of Mutually Assured Destruction: "the only way to win is not to play." It's the same attitude that still explains why giant companies don't (typically) begin patent wars -- there's no point if everyone ends up destroying each other.

The collusion allegations sound serious, but I believe the pando.com article has a couple misunderstandings and is overly sensationalist:

1. It is not illegal for a company to have its own “Do Not Cold Call” list. If you know that poaching your allies’ employees is likely to jeopardize the joint projects, you may choose not to poach your allies’ employees. If you know that poaching your competitor’s employees will likely provoke them to poach your own employees, you may both choose to avoid the mutually assured destruction. As far as I know, it is only illegal to collude with your competitor to make such a list. But it appears that Google did have illegal agreements.

2. One of the quotes from a Google memo, “Most companies have non-solicit agreements which would limit or prohibit a candidate from asking a coworker to interview with us as well,” appears to have nothing to do with anticompetitive behavior. Instead, it probably refers to non-solicit agreements that employees often must agree to when joining a company that prohibit the employee from poaching one of their coworkers for a time after leaving the company. The memo warns not to pressure employees to violate contracts they have signed with their prior employers.

Interesting choice of subjects in the headline. I see that Saint Steven's reputation is still off-limits. My reading of the first two emails is that Jobs was a raging asshole in every facet of life and business.

The same way the SEC opens insider trading investigations based solely on market data - eg. unusual volume of transaction preceding a major unplanned announcement - a government body should mine employment data from LinkedIn for example and investigate cases where there are very few employees switching jobs between large corporations.

This is even more unsettling when you realize that Google, Apple and such have employees that generate revenue in the range of a million dollar per head yet pay a average salary that is 10-20% of that. They end up with absurdly large piles of cash that banks and financial institutions never see because they compensate their employees more fairly.

I have to say, the only person that disappoints me in all of this is Sergey Brin. I guess I kind of expected everybody else to be a douche, but he's fostered this free-thinking Tony Stark/Ironman persona and this just makes him seem like a coward, who caved the instant Steve Jobs came-a-ranting.

As I understand it, they were still allowed to hire from each other, they just agreed not to poach employees from each other. That doesn't sound so unreasonable to me.

I'm not very knowledgable of this sort of thing -- what have other professions historically done to mitigate this sort of thing? Unions? Licensing boards?

Like many of you I am one of the engineers that's covered by the suit and may stand to benefit from it.

Having said that, I want to play devil's advocate for a second. It's just my natural reaction when the press embeds big unquestioned assumptions in reporting for the sake of sensationalism -- namely that this is obviously "illegal" and nefarious behavior. Because, after all, it kept down wages for people like me who might otherwise have been more actively recruited.

If your reaction is OF COURSE IT'S ILLEGAL, just hold on a second. Try to think about the counterargument rationally, even if it's against your personal interests. (That's what I'm doing.)

There do exist many precedents for agreements and restrictions on seemingly "competitive" behavior that is deemed "unfair".

Let's consider a related example from another domain: countries "dumping" cheap goods into foreign markets. For example, China is accused of "dumping" subsidized steel into the U.S. market, which hurts the industry here. The U.S. steel industry works with the government to put in place tariffs that block the practice.

So is the U.S. steel industry being anti-competitive here? Have they engaged in an anti-competitive pact with the U.S. government conspiring to keep up the price of steel here?

Well, on the surface, yes they have. But the distinction is that "dumping" is meant to describe a particular form of competition that is short term and unsustainable in nature and designed primarily to destroy competing business. It is meant to isolate a specific practice that actually hurts competition in the long run.

So, what about the practice of poaching employees from competitors? Well think about it for a minute.

What is the value of a Safari engineer to Google's nascent Chrome team? The truth is, it's a lot more than just that engineer's skillset. There's also the value of undercutting Apple's Safari development. That's HUGELY valuable to a competitor.

So, I just wanted to put it out there that at first blush at least, that the practice of "poaching" may actually have an anticompetitive angle. Just like with "dumping", you have to look beyond the immediate act (restricting/boosting prices) and examine the particular practice it's attempting to curtail.

This is real theft. I applaud my free market overlords for such setting fine examples of Machiavellin psychopathy and systematic duplicity, where they on the one hand lament the "shortage" of engineers and the failure of the education system, whilst simultaneously depressing the wages that should have been demanded from the fruits of that self same system.

Fuck. These. Assholes.

To quote Stringer Bell. Again.

"[I]s you taking notes on a criminal fucking conspiracy?"

Setting aside issues of ethics and legality, I cannot believe that any of these people would ever commit any of this to electronic record.

"Brin appears to not know what the nature of the agreement is between the two companies."

I still remember a HN thread which suggested that Larry/Sergey fire Eric Schmidt for this: https://news.ycombinator.com/item?id=3523513

Since this has market-wide effects, it seems fair to compensate all engineers working in the bay area during that time period.

From 2006

> he was sure we were building a browser and were trying to get the Safari team

Well he wasn't wrong...

When did work start on Chrome? First release was in 2008.

I'd like to see criminal prosecutions here.

Not sure why this is ruffling so many feathers. There are thousands of great tech companys to work for that aren't on any Google, Apple or EBay "no-hire" list and vice versa. I fail to see how a few big companys agreeing not to poach talent from each other artificially reduces the total compensation ceiling industry wide.

Since our employers are clearly not above playing juvenile dirty tricks, what's to stop us engineers returning the favor?

Other professions (Doctors, Lawyers) use legislation to restrict the supply of labor and drive up prices, so why should software engineers be any different? We currently make ourselves vulnerable to manipulation and abuse in a way that no other profession has been stupid enough to do for centuries.

We should lobby aggressively for legislation requiring professional accreditation for practicing software engineers, as well as for the provision of training and documentation services. We need to shut down the technical MOOCs, as well as efforts like stack overflow and code academy. All of these things, whilst seemingly noble, do our profession grievous harm.

The behavior seems slimy (otherwise there'd be no need to be all cloak-and-dagger about it), but the interpretation seems sensationalist (Pando: "Price Fixing!"). As far as I can tell from the evidence, this was a 'no cold call' agreement, not an agreement not to hire people who apply or to set their wages, perhaps with the exception of high level managers or executives, most of whom, if they wanted to demand higher salary, could leak or threaten to leave for another company, and who are often under other constraints. In fact, it's not even clear this is about wages per say, but the disruption that comes from breaking up team and concerns over intellectual property/trade secrets leaking.

I'd be pissed if I applied for another job and was turned down purely because of my previous employer. But I'm not phased by avoiding cold calls. I still get loads of emails trying to recruit me and they're mostly annoying. If I decide to switch jobs, it'll be because I initiate it, not because of HR reps phoning me.

If you were around during the last dot-com boom, you may remember the ridiculous poaching that went on, startups offering insane signing bonuses and other perks, employees changing jobs after only a few months on the job. I worked for a company once that had $100+ million in Softbank funding, and funneled a huge amount of it through headhunters which received a bounty on each hire, and were incentived to bribe prospects to quit their current job.

I'm not sure this is healthy for the industry as a whole. There's already an apparent bubble in asset prices and cost of living in the Bay Area, and while it seems good for some tech workers in the short term to have salaries pumped through the roof, I'm not sure it's good for the overall tech economy, or the economy in general.

I'm somewhat sympathetic to the notion that companies want to avoid aggressive and invasive poaching on each other's workforces, it could turn into mutually assured destruction. If I had a startup, I'd be pissed of someone came along (and poached my employees instead of an acqui-hire) that I spent significant amounts of resources recruiting and training.

To read some of the press articles, you'd think this was the Grapes of Wrath or something, that poor tech workers, the ones who drive around in luxury busses and pay $3000-5000/mo for studio apartments in SF, are woefully under compensated. I wonder if this was a story about Goldman Sachs and JP Morgan conspiring to keep down the compensation of Wall Street money managers through no poach agreements, we'd have the same coverage.

Here's analogy. Let's say there is an employee marketplace. Employers list jobs for offer and salary. Employees list skills, availability, and asking salary. If the employers don't conspire to artificially restrict the offers and salary prices listed, would we say this is a competitive market with no price fixing?

Ok, now let's say that besides listing the jobs and prices, Employers activity solicit buyers. With stocks regulated because of issues (http://www.sec.gov/answers/cold.htm). But let's say employers cold call the employees and tell them to 'buy' a particular offer. Then at some point, the companies cease using sales forces to go out and cold call people to buy these offers. Instead, employees must come to the market of their own accord and bid on them. Is this really price fixing?

If all brokers stopped calling you trying to get you to "Buy XYZW", you wouldn't consider them trying to manipulate the price of XYWZ.

Meanwhile in medicine we need the AMA to keep physicians in short supply so the wages stay high...

Whatever happened to "Don't be evil" :(

Genentech (http://www.gene.com/) is also on "do not cold call" list. How this company is related to google's business profile?

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Now lets talk about "Don't be Evil!"

I personally don't care if employers agree not to hire each other's employees. People are free to make agreements if they want to, just as employees are free to not work for them. There's nothing immoral about it.

Are you free to use the power of the state to try an boost your salary? I don't think you should be able to do that. But apparently many people do.

Genuine question - I see a lot of references to the fact that this practice is "illegal", but what law is it violating?

I'm confused about this entire situation. If I own a company in the US then it's my right to not hire from someone else's company if I so choose, yes? And in the case of tech giants then there is a lot of proprietary tech knowledge that can exist in an engineer's brain that may make him or her a very strategic hire for my competition. So, if I'm paying an engineer $100K and Google sees fit to hire them away for $200K then, sure, it's in the engineer's interest to tell me because then I would need to offer $250K to keep them. And this isn't because they have suddenly become more valuable, or because the engineer has suddenly developed new skills, it's simply a game of strategy and money that could potentially hurt both businesses. So, it makes sense to me that companies would agree to skip the drama, and just agree not to poach talent from each other. And, honestly, how many Apple designers, Google engineers, or EBay executives have gone hungry because of these non-compete agreements? When you're playing in that league then you are already extremely well compensated. So, is it simply a matter if principal? Why exactly is it illegal? These are honest questions.

It's interesting that Microsoft is barely mentioned here. Perhaps it's just because they are not in the Bay area?

"Additionally, there are no restrictions at any level for engineering candidates."

Basically their agreed upon policy says that they can hire any engineers they want, but you better not hire one of our managers! What an indictment of the higher value attributed to managers over engineers.

Here's an earlier story about this: http://www.theverge.com/2012/1/27/2753701/no-poach-scandal-u...

Don't be evil,...except when it comes to hiring & labor practices.

Watch talk by Lawrence Lessig SCALE 12x: https://www.youtube.com/watch?v=D3O1MC1AqvM

Employers "conspire" to hold down wages -- "bad".

Employees "conspire" to raise wages (unions) -- "bad".

Keep in mind the multiple dimensions upon which "privilege" acts -- including those of perception.

In other words, you think people should be "free" as "individuals" to earn whatever they are worth. Well, at its simplest, that is what you are going to get. You are ALSO going to get employers to work against this. Welcome to "libertarianism".

In other other words, I'm suggesting that we are all members of society, and that our personal interests do not lie solely in our own, personal remuneration.

So how many Google share holders does it take to put a motion of "no confidence in the board" on the order paper at the next Google AGM.

Maybe this will bring end-to-end encrypted e-mails to Gmail, so that when they do discuss such things in the future, it's all encrypted properly?

One can hope.

This is good news for every entrepeneur who is developer. Why? Because it shows that you are worth more than companies pay for you!

I remember having heard news about companies not hiring from each other a few years ago, I don't know for what exactly. I suppose to not try and steal each other's knowledge by buying people. I'm not sure which companies it were back then, but Apple and Google are very likely candidates. What changed? Why is this news now?

Well hello Sergey Brin.

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Wait a second. These emails[1] (not the commentary around them) seem to say that the big tech companies in the valley agree not to recruit employees of other companies. There's a big difference between recruit and hire. It seems to me like they've all agreed it's pointless to just poach each other's employees.

Eric Schmidt says the practices are zero sum. In my opinion this is exactly correct. If all the big companies just move each other's employees around, nobody benefits. If instead they all agree to look outside of the talent that's already been recruited, everyone (including developers) benefits. New talent keeps coming in, and developers not in big tech companies have a shot at working at places their parents will recognize.

1. http://pando.com/2014/03/22/revealed-apple-and-googles-wage-...

This is the free market. People choose what they think they are worth. If you don't think Google is paying you enough, quit. Deals with companies to avoid poaching have a cost themselves. This doesn't need more government interaction this needs people to value their work, to think.

I am wondering what happens when one mails directly to the mentioned addresses.

Or, what 4chan/other trolls could potentially do with it.

Publicly disclosing internal matters for the courts is bad enough, but PII like internal mail addresses should be redacted before release!