4 ms·

This guys analysis is pretty bad. Maybe I'm reading too much into it, but I don't think the deal was at all about maintaining good partner relations. I think i

by btmorex 16y ago

This guys analysis is pretty bad. Maybe I'm reading too much into it, but I don't think the deal was at all about maintaining good partner relations. I think it was more about trying to hold wages down in the valley. I realize that it was only a handful of companies, but those are the companies that literally everyone else looks to (for wage levels) and competes with for employees. It's quite possible that that agreement had very real effects on average salaries.

shin_lao 16y ago
I don't see how a company could have prevented an employee from leaving voluntary. The article states that the company agreed not to use the most aggressive recruitment techniques (cold calling) on each other, which sounds like a gentlemen agreement more than collusion. Google states that they recruited from Adobe, Intel, Apple, etc., that's pretty easy to verify.
- reader5000 16y ago
  He said the practice would repress wages. Absolutely nothing about leaving voluntarily. It seems pretty reasonable that an agreement banning the most aggressive forms of recruitment would have some negative effect on employee compensation.
- ohyes 16y ago
  They agreed not to actively compete for each other's employees. In my simplistic (possibly wrong) view; If you look at employment as a market place, and individual employees as different commodities, it keeps the market price of employees (specifically the extremely talented ones) artificially low. In the extreme it would be similar to price fixing. This is good for Larry and Sergei and Steve, but not good for the rest of us. They shouldn't be making any agreements about hiring practices. (Gentlemen's or not).
  - matwood 16y ago
    I think your view is spot on. This was large companies engaging in collusion to artificially hold down wages in the labor market. The article mentions that employees should know their worth, but doesn't mention how? The only way to know is to either actively seek a new job and get offers or be approached through cold calling. This ruling clearly helps the employee.
borism 16y ago
Spot on! Here's much better analysis: excerpt: It's not just that their actions are shameful. It's not just that these actions violate everything Silicon Valley represents. These agreements reveal a profound insecurity about their ability to compete on free and fair terms with one another. http://www.mercurynews.com/top-stories/ci_16167551 http://www.mercurynews.com/top-stories/ci_16167551
cilantro 16y ago
Exactly. These deals were not really Apple vs. Google. The real contest was managers vs. employees. In this case managers were cooperating to suppress the pay of engineers. Now without this collusion, engineers are free to extract greater rents for their services.
- dspeyer 16y ago
  If that were really the point, wouldn't they have expanded this to more companies? Microsoft? Oracle? Yahoo?
  - cilantro 16y ago
    There is after all a strategic benefit to this; getting your talent for cheaper. Consequently a deal like this b/t direct competitors is harder to get off the ground. Also as an optimization problem, there are many different constraints that come into play at different parts of the curve. When you saturate the employment market with this behavior the market would likely seize up.
  - endtime 16y ago
    There are a lot of people (of varying degrees of foolishness[1]) who want to work at Google or Apple but wouldn't even consider the companies you listed. [1]Prefer working at Google to Oracle? Fair enough. Rather work at Apple than Microsoft? Ha, have fun with that.
  - btilly 16y ago
    No. Those companies don't have a great reputation among tech people, but have a lot of good people working for them. Therefore they don't push prices up much, and are a great source of good candidates. Why would these companies choose to do that?
    - nostrademons 16y ago
      If that's the reasoning, why are FaceBook and Twitter not included? They have a good reputation among tech people, a bunch of engineers working for them, and (in FaceBook's case at least) they push salaries up a lot. The particular companies involved make me think this really is about good partnership relations - until Android, Apple and Google had a really good relationship, Apple and Pixer share a head honcho, they all buy from Intel, Intuit's not really a competitor to any of them, etc. The effect, of course, is to drive down wages for the employees who would otherwise have been poached, and that's why the DoJ got involved. But I doubt that execs at each of those companies were telling themselves "We're going to drive down wages for our key employees" when they made the policy.

by btmorex 16y ago

shin_lao 16y ago

I don't see how a company could have prevented an employee from leaving voluntary. The article states that the company agreed not to use the most aggressive recruitment techniques (cold calling) on each other, which sounds like a gentlemen agreement more than collusion. Google states that they recruited from Adobe, Intel, Apple, etc., that's pretty easy to verify.

reader5000 16y ago
He said the practice would repress wages. Absolutely nothing about leaving voluntarily. It seems pretty reasonable that an agreement banning the most aggressive forms of recruitment would have some negative effect on employee compensation.
ohyes 16y ago
They agreed not to actively compete for each other's employees. In my simplistic (possibly wrong) view; If you look at employment as a market place, and individual employees as different commodities, it keeps the market price of employees (specifically the extremely talented ones) artificially low. In the extreme it would be similar to price fixing. This is good for Larry and Sergei and Steve, but not good for the rest of us. They shouldn't be making any agreements about hiring practices. (Gentlemen's or not).
- matwood 16y ago
  I think your view is spot on. This was large companies engaging in collusion to artificially hold down wages in the labor market. The article mentions that employees should know their worth, but doesn't mention how? The only way to know is to either actively seek a new job and get offers or be approached through cold calling. This ruling clearly helps the employee.

borism 16y ago

Spot on! Here's much better analysis: excerpt: It's not just that their actions are shameful. It's not just that these actions violate everything Silicon Valley represents. These agreements reveal a profound insecurity about their ability to compete on free and fair terms with one another. http://www.mercurynews.com/top-stories/ci_16167551 http://www.mercurynews.com/top-stories/ci_16167551

cilantro 16y ago

Exactly. These deals were not really Apple vs. Google. The real contest was managers vs. employees. In this case managers were cooperating to suppress the pay of engineers. Now without this collusion, engineers are free to extract greater rents for their services.

dspeyer 16y ago
If that were really the point, wouldn't they have expanded this to more companies? Microsoft? Oracle? Yahoo?
- cilantro 16y ago
  There is after all a strategic benefit to this; getting your talent for cheaper. Consequently a deal like this b/t direct competitors is harder to get off the ground. Also as an optimization problem, there are many different constraints that come into play at different parts of the curve. When you saturate the employment market with this behavior the market would likely seize up.
- endtime 16y ago
  There are a lot of people (of varying degrees of foolishness[1]) who want to work at Google or Apple but wouldn't even consider the companies you listed. [1]Prefer working at Google to Oracle? Fair enough. Rather work at Apple than Microsoft? Ha, have fun with that.
- btilly 16y ago
  No. Those companies don't have a great reputation among tech people, but have a lot of good people working for them. Therefore they don't push prices up much, and are a great source of good candidates. Why would these companies choose to do that?
  - nostrademons 16y ago
    If that's the reasoning, why are FaceBook and Twitter not included? They have a good reputation among tech people, a bunch of engineers working for them, and (in FaceBook's case at least) they push salaries up a lot. The particular companies involved make me think this really is about good partnership relations - until Android, Apple and Google had a really good relationship, Apple and Pixer share a head honcho, they all buy from Intel, Intuit's not really a competitor to any of them, etc. The effect, of course, is to drive down wages for the employees who would otherwise have been poached, and that's why the DoJ got involved. But I doubt that execs at each of those companies were telling themselves "We're going to drive down wages for our key employees" when they made the policy.