The Justice Department caught Google, Apple and some other companies making a backroom deal to keep one company from cold-call recruiting employees at the other. This is the kind of nuts-and-bolts anti-trust enforcement that we need, and we need a hell of a lot more of it after Al Gonzales ran amuck in the Bush DOJ.
Reader Interactions
19Comments
Comments are closed.
PaulW
This is great. Can the DOJ force the companies to pay their fines directly to us citizenry? I need the cash…
burnspbesq
Much ado about nothing. The proposed settlement can’t be effectively enforced, because there is nothing to keep the defendants from unilaterally deciding to continue to refrain from cold-calling each other’s employees.
Your reflexive bias against bigness is clouding your judgment.
Linda Featheringill
@burnspbesq:
Maybe. But it is difficult for little guys to arrange for a monopoly, so all anti-trust activity is against the big guys.
You might have a point about the impossibility of enforcement, though.
Violet
I’ve got a friend who works for a company that does not allow its employees to take jobs with its clients. This is a large, global company in a fairly small industry. They were having problems with their employees leaving to take jobs with their clients once the clients saw how good the employees were (in reality the clients were poaching the employees). So they had a word with the clients and the employees now can’t go work with the clients for at least a year after leaving the company. Most of the clients are also large, global companies.
This is a small industry and this change really inhibits employees’ ability to get other jobs. Since the economic downturn it’s less of a problem than it used to be, but it’s still frustrating. Many of them feel like they’re trapped because if they leave they can’t get a job in their industry for a year.
This situation with Google, etc. and the technology industry sounds very similar to what happened at my friend’s company.
burnspbesq
Slagging Gonzales for Republican indifference to antitrust enforcement is a gratuitous cheap shot. Republican indifference to antitrust enforcement can be traced to William French Smith’s tenure as AG under Reagan. It was a wrong choice, but it was not an illogical choice at the time, if your frame of reference was the breakup of the Bell System, which took 15 years to accomplish, at incalculable cost, for not much benefit to consumers.
Omnes Omnibus
@burnspbesq: Most anti-trust situations fit your description. Companies “unilaterally” decide not to compete in one another’s home territory. They “unilaterally” decide to set prices at a certain level. Yadda, yadda, yadda. This is why anti-trust case are difficult; you do generally find a notarized agreement to fix prices or divvy up the market.
Omnes Omnibus
@burnspbesq: Most anti-trust situations fit your description. Companies “unilaterally” decide not to compete in one another’s home territory. They “unilaterally” decide to set prices at a certain level. Yadda, yadda, yadda. This is why anti-trust case are difficult; you do generally find a notarized agreement to fix prices or divvy up the market.
Keith
Do you live in a Right to Work? I’m in Texas and have had to sign no competes along those lines, but my understanding has been that they are very difficult to enforce in RTW states (I’ve known a few people who violated their no-competes)
Kirk Spencer
@burnspbesq: Actually the settlement can be somewhat enforced. The primary step is occasional review of the “do not cold call” list, which was the mechanism by which the companies ensured their HR personnel followed the agreement.
Can this be evaded with verbal instructions? Sure. That only risks having a teed off worker turning whistleblower, leading to the company paying a fine and making a scapegoat of the person giving the verbal.
burnspbesq
@Omnes Omnibus:
“Conscious parallelism” has always made me queasy. If you can’t prove a conspiracy to monopolize, maybe there’s no violation.
That said, where the heck were the in-house lawyers when these agreements were being negotiated? My concerns about whether the settlement can be enforced don’t change the fact that the case was a slam dunk on liability.
Omnes Omnibus
@burnspbesq:
It is a very fuzzy line IMO. When does talking talking shop with a competitor and saying, “Wouldn’t it be nice if…” become an anti-trust violation? It is a tough question. I’ve had clients who have had conversations with competitors that, well, could raise concerns. Not violations, but the sort of things could cause someone to talk about whether or not violations should be talked about.
Omnes Omnibus
@burnspbesq:
It is a very fuzzy line IMO. When does talking talking shop with a competitor and saying, “Wouldn’t it be nice if…” become an anti-trust violation? It is a tough question. I’ve had clients who have had conversations with competitors that, well, could raise concerns. Not violations, but the sort of things could cause someone to talk about whether or not violations should be talked about.
Omnes Omnibus
@Omnes Omnibus: I f’ing hate f$#%ing FYWP.
General Stuck
@Omnes Omnibus:
Me too
Me too
RSA
In the comments to that article a lot of people are saying, “What’s the big deal?” I think the big deal is that it’s an obvious effort to keep down labor costs (and management costs, I suppose), and it comes at the expense of the employees of those companies that made such agreements as well as all the companies not part of those agreements. I’m not a lawyer, so I don’t know about the legal niceties.
ornery curmudgeon
@burnspbesq:
Well, I for one have a reflexive bias against bigness, the same one I have against bullies and cheats. Maybe because I don’t associate ‘bigness’ in corporations at this late date with ‘success’ or as a sign of quality or hard work or virtue in any form. Quite the opposite.
I would have thought the insane ‘too-big-to-fail’ excuse to take our taxpayer money to buy US out might have illuminated the dangers of ‘bigness’ to Americans … well, not lately, but there was a time I would have thought that.
We and our planet are dying of a corporate structure originally designed to create and harvest markets, instead of saying ‘oops’ and reforming that world-devouring structure. No, we simply watch our society be cannibalized as we invest in buy-outs and ignore the leverage growing around us … meanwhile being subjected to nonsense from those too blind or too captured to acknowledge the bigger picture.
The Chinese curse was wrong, these times aren’t that interesting really.
Mnemosyne
@Violet:
What state is your friend in? I know that California has found those clauses to be unenforceable, but we are pretty employee-friendly here, relatively speaking.
Origuy
I see that it’s an antitrust violation, but I think that they should be trying to hire people who aren’t already working, or are working at Home Depot when they have a CS degree.
Comrade Sock Puppet of the Great Satan
IIRC, California (not a right to work state) law voids non-compete clauses: you’ll still find them in your contract, but there’s no legal force behind them.
It’s a big factor in Northern California being the tech center it is.
So Apple, Google, etc. did their own informal end-run around it, it seems. Most anti-trusts suit end up being pretty painful for the defendants, so expect some sizable fines.