What do Apple, Google, Intel, and Adobe have in common?

How about greed and the desire to underpay skilled employees.  The answer to the question was revealed due to a class action lawsuit filed by 64,000 programmers and engineers who accused these companies of conspiring not to raid one another’s workforces in the interest of stifling competition and suppressing wages.  The lawsuit uncovered the fact these Silicon Valley Kings secretly forged no-recruit agreements between 2005 and 2009. The evidence of their dirty little agreement was buried in numerous emails.  My favorite was sent by Google CEO Eric Schmidt.  It appears Schmidt instructed one of his minions to verbally advise other Google employees of the agreement not to raid another’s workforce as he did not want to create “a paper trail over which we can be sued later.”

Each company agreed not to recuit the other company’s employees because to do so would drive payroll costs upward for all of the companies…or as I like to say, to a fair market level of compensation.

At first glance the fact these companies agreed to settle this antitrust hiring case by paying $324 million seems to be a significant.  $324 million is a lot of money….unless it is being paid by Apple, Google, Intel, and Adobe.  It is important to keep in mind that $324 million is only 0.4 percent of the companies’ combined revenue for the most recently reported quarter!

My Take:  The dirty little agreement reached by these companies is the worst possible non-compete scenario.  Companies should pay employees based upon what is fair in the market place, free of collusion and non-compete agreements which hurts everyone in the long run.

Dan Frith

Dan Frith

Dan Frith has over 25 years of experience representing individuals and families in cases of medical malpractice throughout Virginia. He has been named "Best Medical Malpractice Attorney" by Roanoker Magazine and is a member of the Million Dollar Advocates Forum. To speak with Dan, contact him by email at dfrith@frithlawfirm.com.