As expected, the Department of Justice has reached a settlement with six high technology companies – Adobe, Apple, Google, Intel, Intuit and Pixar – barring them from entering into no-solicitation agreements for employees.
The deals didn’t prevent the companies from hiring one another’s staff, but did guarantee that they wouldn’t cold-call them. The DoJ said this removed the competition to attract highly skilled employees, and also affected employees who could be denied access to better job opportunities.
“The agreements challenged here restrained competition for affected employees without any procompetitive justification and distorted the competitive process,” said Molly S Boast, deputy assistant attorney general in the Department of Justice’s Antitrust Division.
“The proposed settlement resolves the department’s antitrust concerns with regard to these no solicitation agreements.”
The settlement will run for five years, and prohibits the companies from engaging in no solicitation agreements. It bars them from entering, maintaining or enforcing any agreement that in any way prevents any person from soliciting, cold calling, recruiting, or otherwise competing for employees.
The complaint arose out of a larger investigation by the Antitrust Division into employment practices by high-tech firms, and the DoJ says it will continue to investigate other similar no-solicitation agreements.
Google says it’s happy with the agreement.
“While there’s no evidence that our policy hindered hiring or affected wages, we abandoned our ‘no cold calling’ policy in late 2009 once the Justice Department raised concerns, and are happy to continue with this approach as part of this settlement,” said Amy Lambert, Google’s associate general counsel for employment.
Intuit’s less pleased, saying it’s ‘agreed to disagree’ with the Department.
But a failure to settle with the DoJ would have led to a high-profile court battle and the prospect of lawsuits from employees affected by the no-poaching agreements.