Does Google (GOOG) have an agreement with Apple (AAPL) that it won't hire one anothers' employees even though the companies are rivals? Does Intel (INTC) have an similar agreement with IBM (IBM)? The Justice Dept. believes that these kinds of arrangements are common among tech giants, and it has significantly stepped up an investigation that may prove it.
According to The Wall Street Journal, "the probe is looking into whether the companies' hiring practices are costing skilled computer engineers and other workers opportunities to change jobs for higher pay or better benefits." Essentially, an employee could be "trapped" at one company because of agreements among large hardware and software makers.
Dampening Pay Growth?
The paper says the companies being investigated include "Google Inc., Intel Corp., International Business Machines Corp., Apple Inc. and IAC/InterActiveCorp. (IACI), people familiar with the matter said."
The Justice Dept. won't admit or deny that the investigation is underway and has deepened considerably. Some of the companies involved say their hiring practices are completely legal.
While the practice of "no hire" agreements among these companies may appear to be an antitrust issue, it does allow them to maintain consistency of product development. It would be inconvenient for a senior engineer working on an advanced chip's design at IBM to suddenly leave and go to Intel. The problem, as the Justice Dept. sees it, is that the engineer should be able to move because in doing so, he or she would almost certainly get a raise.
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