US DOJ settles with Google, Apple and 4 others over high-tech employee solicitation

The US Department of Justice (DOJ) has reached a settlement with Google, Apple, Intel, Adobe, Intuit and Pixar to prevent those companies from entering into no solicitation agreements for employees. The settlement would be in effect for five years and still needs to be accepted in court.

A press release by the DOJ announcing the settlement says;

“…the six companies entered into agreements that restrained competition between them for highly skilled employees.   The agreements between Apple and Google, Apple and Adobe, Apple and Pixar and Google and Intel prevented the companies from directly soliciting each other’s employees.   An agreement between Google and Intuit prevented Google from directly soliciting Intuit employees.”

The highly revealing press release goes onto to state that:

“In the high technology sector, there is a strong demand for employees with advanced or specialized skills, the department said.   One of the principal means by which high tech companies recruit these types of employees is to solicit them directly from other companies in a process referred to as, “cold calling.”   This form of competition, when unrestrained, results in better career opportunities, the department said… the companies engaged in a practice of agreeing not to cold call any employee at the other company.   The complaint indicates that the agreements were formed and actively managed by senior executives of these companies.”

Apparently, some of these agreements go all the way back to 2005:

Beginning no later than 2006, Apple and Google executives agreed not to cold call each other’s employees.   Apple placed Google on its internal “Do Not Call List,” which instructed employees not to directly solicit employees from the listed companies.  Similarly, Google listed Apple among the companies that had special agreements with Google and were part of the “Do Not Cold Call” list;

Beginning no later than May 2005, senior Apple and Adobe executives agreed not to cold call each other’s employees.   Apple placed Adobe on its internal “Do Not Call List” and similarly, Adobe included Apple in its internal list of “Companies that are off limits”;

Beginning no later than April 2007, Apple and Pixar executives agreed not to cold call each other’s employees.   Apple placed Pixar on its internal “Do Not Call List” and senior executives at Pixar instructed human resources personnel to adhere to the agreement and maintain a paper trail;

Beginning no later than September 2007, Google and Intel executives agreed not to cold call each other’s employees.   In its hiring policies and protocol manual, Google listed Intel among the companies that have special agreements with Google and are part of the “Do Not Cold Call” list.   Similarly, Intel instructed its human resources staff about the existence of the agreement; and

In June 2007, Google and Intuit executives agreed that Google would not cold call any Intuit employee.   In its hiring policies and protocol manual, Google also listed Intuit among the companies that have special agreements with Google and are part of the “Do Not Cold Call” list.

“Although the complaint alleges only that the companies agreed to ban cold calling, the proposed settlement more broadly prohibits the companies 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 companies will also implement compliance measures tailored to these practices.”