Google Inc (NASDAQ:GOOGL) (NASDAQ:GOOG) is known for taking good care of its employees. The company offers them lucrative incentives and a number of perks to keep them motivated and happy. But few people know that the same company allegedly colluded with Apple Inc. (NASDAQ:AAPL), Intel Corporation (NASDAQ:INTC), Adobe Systems Incorporated (NASDAQ:ADBE) and dozens of other technology firms to suppress employee wages between 2005 and 2009. They reportedly did it by secretly agreeing not to hire each others’ employees.
Google, Apple and others violated Peter Drucker’s law
Tech companies are desperate for high-performing employees. So, skilled engineers and software developers find it easy to switch companies for a higher position or salary. Management Guru Peter Drucker said in 1959 that knowledge workers own the means of production between their ears. He stated even before the dawn of the technology era that knowledge workers have mobility and they can leave a company for another firm.
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However, Google Inc (NASDAQ:GOOGL) (NASDAQ:GOOG), Apple Inc. (NASDAQ:AAPL) and others violated Drucker’s law. Their bosses allegedly sent emails and made phone calls to prevent you from working at a rival company, something that had apparently been going on for years. And now these companies are facing a class-action lawsuit, which seeks $3 billion in damages for at least 64,000 Silicon Valley engineers who were affected by the collusion. Trial for the case is set to begin next month in San Jose. If the companies lose, the damages could rise up to $9 billion.
Now the federal court jury will decide whether Google Inc (NASDAQ:GOOGL) (NASDAQ:GOOG) and other tech giants violated antitrust law. However, The New York Times says that a pre-trial settlement could be reached this week. The litigation so far hasn’t favored technology companies. In 2010, they reached a settlement with the Department of Justice, which required the companies to stop the collusion. In the latest lawsuit, a judge has said that the case merits the class action status.
Google had to fire a recruiter because she tried to hire Apple engineers
Documents that surfaced earlier this week show that Google Inc (NASDAQ:GOOGL) (NASDAQ:GOOG)’s Eric Schmidt and executives from other technology companies openly discussed the no-poaching deal. A March 2007 email sent by Eric Schmidt and Apple Inc. (NASDAQ:AAPL)’s then-CEO Steve Jobs notes that a Google recruiter who tapped into the iPhone maker had violated the company policy, and had been fired. Schmidt reassured Jobs that he would take stringent measures if something like that ever happened again. To that, Jobs responded with a smiley face.
The lawsuit has proved humiliating for Apple Inc. (NASDAQ:AAPL). The company lawyers have been persuading the court to exclude Jobs’ emails from the case as they make him appear like a bully. And the documents show that Steve Jobs bullied Google Inc (NASDAQ:GOOGL) (NASDAQ:GOOG) into not recruiting his employees. Emails from Sergey Brin suggest that an “irate” Steve Jobs kept calling him until he agreed to terminate a recruiter who tried to poach Apple Inc. (NASDAQ:AAPL) engineers.