
Facebook Refused No-Poaching Agreement With Google - byoogle
http://techcrunch.com/2014/03/24/sheryl-sandberg-facebook-refused-no-poaching-agreement-with-google/
======
StefanKarpinski
I recall wondering at the time why, if there was such a shortage of talented
developers, newly minted lawyers were still making several times as much as
good programmers. Now we know part of the reason why: Apple, Goole, Adobe and
all the other big names in tech – except, apparently Facebook – were illegally
colluding to pay talented devs less money. Since this was discovered, industry
pay scales have gone up, while law salaries have dropped – now it's much
closer. The thing that bothers me the most is that this illegal collusion
suppressed wages for the _entire_ software industry, robbing us all of money
that lined the pockets of these companies. The plaintiffs in this case are by
far not the only ones who were affected – Apple, Google, et al. stole tens of
thousands of dollars per year from each person who was working in the software
industry for the better part of a decade and the vast majority of us aren't
going to get any of that back.

~~~
doktrin
This isn't an apples to apples comparison. Law school can require as much as
$200k and 3 years of opportunity cost on top of whatever was spent on
undergrad.

Additionally, it's my understanding that getting a _shot_ [1] at the big
leagues in law requires a top-12 school. Are mid-tier law schools pumping out
lawyers who make $150k as first year associates? I'd be surprised, but I don't
have the data.

[1] Even attending a top school is no guarantee. Law school is fiercely
competitive, and only top-scoring students from top schools get the really
lucrative & prestigious positions.

~~~
ken47
"Law school can require as much as $200k and 3 years of opportunity cost on
top of whatever was spent on undergrad."

You seem to be missing the economic realities at play. The cost of law school
does _not_ matter. All that matters is the supply and demand for lawyers and
programmers. And if you've been keeping your ear to the ground, you may be
aware that there is a significant oversupply of law grads nowadays.

There is no economic law that says that lawyers should make more money than
programmers because they choose to be ripped off in pursuit of their training.
If in the future, the salary of the average lawyer were to drop below that of
the average programmer, Adam Smith would not bat an eye.

~~~
rohanpai
If law school is so expensive, it is harder to become a lawyer. If less people
become lawyers, the supply decreases (resulting in the demand for the shortage
of lawyers to be greater).

"There is no economic law that says that lawyers should make more money than
programmers because they choose to be ripped off in pursuit of their
training."

You don't NEED a degree to do programing. Arguably a computer science degree
is standard but even then, you don't need 7 years of schooling. In order to be
a lawyer, you need to complete law school.

At the end of the day, it's fair for a lawyer to charge more. Why? Because
someone is willing to pay the premium.

~~~
mehrdada
>In order to be a lawyer, you need to complete law school.

Not in California.

~~~
ZanyProgrammer
Actually, I wonder...I'm pretty sure the number of people who go the
apprenticeship route is in the single digits (though feel free to prove me
wrong). It could be a good way to set oneself apart from the pack when
applying for a job. Goodness knows its a shitty job market for lawyers, and if
you don't have a top tier law degree, strategically it could be a way to set
yourself apart from the pack (especially at the level where you're competing
against sorta middle of the road-ish ABA certified schools-like Santa Clara
and USF).

------
ryandrake
I think we should stop using the word "poach" when describing these job
changes. Use of this word suggests that we (technology workers) are the
property of our employer, and that other employers are "stealing" that
property away. I don't consider myself akin to a cow owned by my previous
employer, stolen by my current one. I hope you don't either. My relationship
with my employer is one of equals, freely and mutually entered into, and does
not imply any ownership of my person.

Hate to be the PC police, but I personally feel offended by the use of this
word, and I'm surprised that more people aren't. I'd like to propose using a
more neutral phrase, like "hire away" to describe this practice, instead of
"poach". I hope, upon reflection about their own role in the employer-employee
relationship, others might come to this conclusion and stop using this word as
well.

~~~
jcampbell1
I think you are being the PC police. There is a difference.

1) Google employee applies to Facebook on their own.

2) Facebook employee tells a Facebook recruiter, who the best Google engineers
are based on his experience at Google.

3) Facebook hires a popular and charismatic Google manager, and their first
assignment is to bring over the best engineers in the group.

What terms do you use to describe these situations? I am happy to adopt a more
PC term, but there is a difference between being "hired" and being "poached".
When you are hired, you do a shit load of interviews, when you are poached,
you get a bunch more money and don't have to do a bunch of interviews.

~~~
ZachPruckowski
Why wouldn't you call it recruiting?

~~~
jcampbell1
That is too generic. That would mean no-hire, no-poach.

------
CoolGuySteve
The worst thing about this oligopoly/cartel is that during the period they
were refusing to poach, they accrued billions cash reserves while spending
only a little on R&D (which I assume is mostly engineering salaries).

Even after the class action lawsuit is settled, it's likely the penalty won't
be anywhere near the amount of profit that was illegally captured.

Furthermore, think about what these companies would have chosen to work on had
engineers been more expensive. Would we have seen more useful products coming
out of the valley if staff allocations had worked out differently?

When people are cheap, throwing them into doomed ventures like Google Buzz or
Apple's awful Samba clone isn't nearly so devastating to whatever middle
manager chain dreamed them up.

~~~
cromwellian
Presumably the shortage of labor was still real, and if they needed to hire
people, but couldn't poach, then they hired them from the rest of the talent
pool. If that's the case, then removing the "cold calls" from the talent
search might have had the effect of actually driving up salaries for those not
working at these companies, since potentially reduced the supply.

If that's the case, then it would not have saved money, rather, it would have
had the effect of simply shifting the money from going to existing
Google/Apple/etc employees to applicants from smaller firms.

That is, it changed the distribution of spending, and probably in a more
egalitarian way, distributing the spending over a larger pool, instead of
simply fighting over, and raising the wages, of the small group of superstars
at the big companies.

These companies are spending on R&D and increasing the percentage year over
year, they are also spending huge sums of acqui-hires, and hiring faster than
the local communities, or their own office space, can handle.

You could argue that excessive salaries are actually bad for allocation. Wall
Street has infamously brained drained tons of the best and brightest to figure
out how to gain small efficiencies in stock trading. What discoveries might
have occurred had string theorists not left to go optimize portfolios?

One thing I wouldn't call engineers is cheap. You're talking about people
making upwards of $150-200k in salary, and probably up to half-million when
total compensation is considered. I paid more in taxes last year than my
mother earned in several years of working as a cashier. And that's pretty sad.
I grew up poor so I have a different perspective on this, but I see a lot of
#zeroethWorldProblems whining going on in the valley while the world around
them is falling apart. It's useful to have some perspective, and honestly, if
these companies are to be fined and sanctioned, I'd rather the money go to
poor people, instead of lawyers and techies who need to increase the bid on
their studio apartment.

~~~
efuquen
Regardless of what the ultimate consequences would have been of any price
fixing scheme, do you or don't you believe it is _wrong_? You can argue all
day about the hypotheticals of how much or how little this all actually
affected wages, but if you believe in principle that some general free market
mechanism should be the determining factor in private sector wages, then you
should disagree with what happened. Even if in the end it's a fight between
the merely wealthy (which, btw, I don't think every engineer at
Google/Apple/etc are making those top wages, at least not based off median
numbers I've seen) with the super wealthy you still had an unfair practice
that skewed what should have been market wages and put more money into the
pockets of the super wealthy.

I think it's acceptable to say that this scheme was bad and wrong and also to
acknowledge that there are more significant and severe wealth and wage
problems in this country for a large group of people outside engineering, law,
medicine, etc. and those problems need to be addressed. I don't like the
attitude of saying hey, the engineers are doing pretty good guys, it's ok if
the even richer take money from them they should have rightfully earned. That
won't solve any problems, least of all the more severe wage discrepancies or
plight of the poor.

~~~
cromwellian
Well, I don't consider not cold-calling as a price fixing scheme. As long as
normal hiring process continues, all you're doing is shifting recruiting from
a smaller pool of highly compensated engineers, to a large pool of less
compensated engineers.

It would only be price fixing if there was an industry wide agreement to put a
cap on engineer salaries. Rather instead, what you have is an agreement to
shop in one market exchange instead of another.

I mean, what do you think is better for both engineers in general, as well as
the companies: Trading a small set of engineers back and forth with ever more
escalating compensation in a bidding war, or, hiring from a large, general
pool of applicants?

One way leads to disruption, mono-culture, and somewhat unfair bias towards
those not on the roster already of the big companies. If anything, not cold
calling should increase diversity as well.

This scheme only seems slimy to me, because any agreement between companies in
secret, seems slimy. But I am really not seeing it as a price fixing scheme,
and I find it hard to get myself motivated to Occupy Mountain View protesting.

This reminds me of several years ago when Google switched the Holiday gift
from giving $1000 tax free cash in an envelope, to giving a free device
(phone/tablet/etc). Some people were irritated by it and complained, but I
found the complaints to be a solo on the world's tiniest violin. Seriously,
there are people starving on Christmas, unable to even buy their children toys
or clothes, and people earning in the top 1%-10% are annoyed that instead of
$1000 cash, they get a $500 device for free. It's an even more absurd version
of Louis C.K.'s "everything is awesome and no one is happy."

~~~
existencebox
I can understand this stance, but I'd point out the section that makes the
issue cross the line of "appropriate collusion" (god that's a terrible phrase)
for me, that being the "We do not hire from these people even if approached in
the normal application process" groupings

Focusing recruiting, sure. But pre-filtering on the basis of factors "not
relevant" to the person performing the job starts to get into a very grey
territory in terms of discrimination. (I realize on the surface this seems
silly since where you are working is totally relevant to a new job, but not in
the context in which it was being utilized.) I really don't intend to draw a
strawman with this, but that I see a big difference between their limiting
their effort, and their prohibiting your effort.

~~~
lsaferite
I find it interesting that had they framed the 'do not hire' rules under the
concept of avoiding lawsuits due to trade secrets, then there would be zero
'evil' in the whole thing (Not that I think it was evil in any case).

On top of that, unless I missed something, the documents I've read excluded
engineers, the ones getting their jimmies ruffled, from the 'do not hire' list
and simply had them on a 'no cold call' list. It was management and sales that
were under some 'do not hire' list, right?

In this whole thing, the only part that I find morally/legally suspect is the
agreement to not hire certain categories of employees from certain companies.
Everything else is just a bunch of hand waving from highly paid people that
want to be paid even more. And even that, had it been worded slightly
different, would be arguably legal.

~~~
existencebox
And that's exactly what I'm getting at. Once you establish that there has been
a breach of law, you _have_ to take the context/wording into account, which is
highly "slimy" on its own merit, as the grandparent post puts it, and turns
what might otherwise be a "don't word your hiring practices in such a way or
collude them between companies" reprimand into a "you're clearly doing really
underhanded things, and are even _self effacing_ about this" (citing the
"let's not put on paper something we could get sued over" memos)

I (as an engineer) have my "jimmies rustled" because this sets a really
worrying precedent for the behaviors of these companies I do/might work for,
and is frankly the sort of behavior that makes me have implicitly low trust
for people with this sort of power, which is an unfortunate state of things.
(I'd really like to be able to trust people, I promise...)

------
byoogle
Money (literally) quote:

 _And what happens next is precisely what is supposed to happen when companies
don’t collude to defraud their employees of fair-market wages: Google coughed
up more money to improve its retention._

~~~
CoolGuySteve
What's most amazing about this debacle is how clueless the executives seem to
be.

From the blatantly illegal smoking gun emails, to Google's almost immediate
raise after this scandal became public. It's so coarse.

~~~
nostrademons
When you're an executive, you have many problems. It's pretty common to deal
with the immediate one and create a whole host of other ones. One could argue
that that's how it should be, because otherwise you're irresponsibly avoiding
what you should be doing.

~~~
sliverstorm
Huh? This just goes back to the whole, fixing the urgent things instead of the
important things.

------
bane
Here's what's saddest to me about this. There isn't really a labor shortage.
These companies colluded for years on salary and poaching to make it possible
to selectively hire from choice schools and people with a certain "pedigree"
\-- which artificially limited the pool of people they felt were
"acceptable"...which drove up the salary of people from this pool which of
course caused them to want to collude to keep wages down. _This_ is why
discriminatory hiring practices are bad for everybody.

Now years later Google, using the power of massive data, has figured out that
it didn't really matter all that much that they were hiring from this
artificially limited pool. Which means it didn't matter all that much to start
with for any of these companies.

If they hadn't colluded on pay and poaching, but stayed selective, they would
have been eventually forced to either reach outside this selective pool and
end the "shortage" or suck up the higher wages.

Basically the market would have resolved the issue of higher wages for them.

------
billyjobob
What was that motto? Don't be... ending? Don't be evasive? ... Don't be Evan?
No, sorry, it's gone. Can't have been important anyway, or someone would have
remembered it.

~~~
badman_ting
I think it was "Let's choose three words that people will beat us over the
head with until the end of time every time we so much as throw a gum wrapper
on the ground"

~~~
sharkweek
I don't care if the company's slogan is "HAIL SATAN, EVIL ROCKS AND CUTE
ANIMALS SUCK" \-- if they're doing something illegal, they deserve to be
beaten over the head.

~~~
badman_ting
Precisely -- they should be taken to task for their unethical and illegal
actions, not some cutesy-poo slogan.

~~~
wavefunction
Don't pick a cutesy-poo slogan as your corporate motto, do the opposite, and
not expect to get grief over it. Why pick that slogan in the first place?

I know "vision-statements" and things like that don't get a lot of mileage
here but character matters.

------
jjallen
Of course Facebook refused! They were hiring many more employees than Google
was as a percentage of the starting employee base because of the insane growth
they were undergoing. They were building a business, they had to keep
poaching.

I don't think Facebook should get much credit for not participating, when they
couldn't have.

Also, from a more game theoretical approach, they were a free rider on the
collusion - they could have outed the collusion if they were that benevolent,
since they clearly knew what was happening. Why didn't they publicize the
blatantly wrong agreements at the time?

~~~
rwallace
The fact that it was in Facebook's interest to do the right thing doesn't
change the fact that when it came to it, they did the right thing and Google,
for all their "don't be evil" talk, did the wrong thing. That's what really
matters in the end.

And I don't particularly like having to say this, because I've been a Google
fan ever since I switched to their search engine from AltaVista, whereas I
think the world would be a better place if Facebook shut down their servers
and deleted their database tomorrow. But yes, damn it, Facebook _does_ deserve
credit here.

~~~
jjallen
They would deserve credit if they acted against their best interests by making
it known what was going on at the time, but they knew they were benefiting
from lower than otherwise salaries due to the collusion.

------
ski
_It’s worth noting that Facebook was hotter than the sun back in 2008, so for
it to continue to recruit from other firms could could have been a reflection
of its market position; if you are doing the poaching, why would you disarm?_

Facebook was much smaller then, and likely had a lot more to gain from
poaching than they had to lose.

------
chippy
Sheryl Sandberg only spoke for herself. She did not mention her knowledge of
what other people in Facebook did. She only said that she, personally, didn't
agree to the agreement on behalf of the company. She did not say that Facebook
didn't have an agreement, only that she did not ever agree to one.

This is an important fact when looking at the evidence. She is only going to
say enough of what she needs to say in terms of the lawsuit. The burden of
proof of the law suit has to prove that Facebook had one - she could only
speak about her own involvement. There was nothing about the other people at
the top of the company - and in Law - nothing equals nothing.

~~~
revelation
Abstract away from the people. At the time, it was simply not in Facebooks
best interest to enter into such an agreement - at their ridiculous growth,
they got lots of money and needed to put it into top talent, which means they
need to aggressively recruit. If you then enter into an agreement not to
recruit from many top companies in the valley - that hurts your chances.

It's not that Facebook is the only ethical company in this, it is just that at
the time there was no upside for them in it.

------
ryguytilidie
To be fair, Sandberg saying "we didn't do this" about an illegal thing doesn't
necessarily mean that they didn't do this. Also, why would a company much
smaller than the others agree to this?

~~~
avdempsey
Losing a talented employee can hurt regardless of the size of the company that
snaps them up. A larger company will often have more resources with which to
compete in the job market. A smaller company might (illegally) join such an
agreement for the same reason that a weaker nation might sign a defensive pact
with a stronger one.

~~~
ryguytilidie
Right, but as a Googler who went to FB, movement was much more common one way
than the other. Also, I can say for a fact that Facebook recruiters were using
Google org charts to reach out to people, so that's probably why they didn't
agree to this, not because they're super awesome nice people.

------
mik3y
In late 2008, Facebook seemed to ramping up hiring (and recruiting
aggressively, with good reason, from Google). Any "truce" would have been
severely one-sided for Facebook.

I'm sure they weren't worried about bleeding employees to Google if they said
no, especially when you remember $GOOG was near a 3-year low and FB growth was
exploding..

------
ojbyrne
The most offensive thing about these stories is that those same people who
conspire to drive down employee salaries then go to their executive
compensation committees where they conspire to drive up executive salaries.

------
eyeareque
I remember my friend At Google telling me that he just got a big raise and
that the raises were happening across the company. I wondered what cause
googled to do this, but quickly assumed it was because Facebook was sucking
talent away from google. At the time googlers were paid less than other
companies too.

Facebook might look good in this instance but remember they were growing
really fast at this time so it would have seriously hurt them to agree to any
hiring pacts.

------
danielweber
Well, I have something positive to say about Facebook.

~~~
loceng
It's not really like they had a choice -- they needed to have access to large
pools of existing work forces, and agreeing to no-poaching would prevent that.

~~~
msabalau
I'm no fan of Facebook, but in the absence of evidence that they acted
tactically, it would seem fair to give them credit for understanding that
participating in a cartel is both stupid and unethical.

~~~
loceng
I would err on the side of caution and look at their previous behaviour as a
predictor of future behaviour, which leads me to it being more from the side
of necessity than anything ethics wise. You know the story of how Facebook was
started yes?

------
debt
Facebook maintains a no-poaching agreement with companies which share the same
board members. Is this common enough for it not be a big deal?

~~~
balls187
This is pretty common in startups: it's considered bad form to poach employees
from companies that have common investors, and board members of those
companies.

Sometimes, however, recruiters may not necessarily know and reach out to
candidates and violate this unwritten rule.

Also depending on the case, boardmembers/investors may look the other way.

~~~
stanleydrew
So why isn't anyone upset about this practice?

~~~
balls187
Good question. Think of it as a "gentlepersons" agreement not to actively
poach someone from another startup with common investors. Similar to how
investors generally don't invest in competitors to their portfolio companies
(but it does happen-- See KPCB investing in both INRIX and Waze).

It was more of a guideline, rather than a hard fast rule.

This agreement didn't prevent people from recruiting friends, or from people
actively looking to join another company.

Also, if the person is/was unhappy at one startup, the investors would prefer
they join another portfolio company rather than not.

------
PythonicAlpha
>The pervasive attempt by large tech companies to suppress wages by
diminishing their employees’ rights to choose where they work is not merely
selfish in the extreme, but is counter to the very market principles that made
these companies so successful to begin with.

The "free market" system is just an illusion. When you are on the side of
those with the lowest power (e.g. the workforce), the system does not work.

So much about the notion, that the "free market" system will correct itself.

------
drawkbox
Platforms are getting a little bit like mini kingdoms these days, feudal in
nature, from the castles of the Altos.

5-10 years before we have a moat around a campus, a technological one though
that blocks all non-essential communication while you are Under the Dome,
then, apartments, pretty soon "bring out your dead"
([https://www.youtube.com/watch?v=grbSQ6O6kbs](https://www.youtube.com/watch?v=grbSQ6O6kbs)).

------
diskerror
This is a great precedent set by Facebook against a not so great one.I feel
that this current trend is quite scary to think about.

Taking away someone's opportunity to be employed elsewhere oversteps the line
between the employer and the employee's personal life.

------
AaronFriel
There's a flip side to this no poaching agreement, evidenced by Facebook's
position:

Is there a benefit to this agreement depressing wages in that, for startups,
obtaining competent developers was cheaper than it would have been otherwise?

~~~
jasonwocky
Well, sure, there was a benefit to the startups' founders and funders.

------
iamshariq
How did people come to the conclusion that these companies had the agreement
to reduce wages?

It seems like they had this agreement - only because they hated their
employees being poached on.

It's not price fixing.

It's self preservation.

Sure it had a side effect of keeping wages low - but that was not their goal.
None of them are short on money.

I'm not saying what they did was right - but lets not frame it in a context
that makes it look like they did this to not let employees have more money.

When in reality - they did it to stop others from stealing their employees.

~~~
djur
You can't "steal" employees. They're people, not property. They have agency.
These agreements exist solely to limit the opportunities of the people who
work for these companies. At the bare minimum they should have been public, so
people who decided to take a job at one of the companies knew they'd be
restricted in their ability to find work elsewhere.

------
kchoudhu
Does anyone know how much money we're talking about here? How much do, say,
Google SRE people make after a few years on the job?

~~~
elwell
Avg $126,375 according to GlassDoor for Google SRE

~~~
kev009
TBH that's surprisingly low. I know engineers making this in Phoenix at mid-
size companies and even more in specific industries like financials. Cost of
living is much lower than many of Google's offices here. These folks are good
engineers, but probably couldn't pass the kernel/syscall level questions
people have shared from Google SRE interviews.

The whole culture of those colluding companies seems pretty feudal - "you
should feel honored to be a member in our court"

~~~
chippy
I think it's exactly that - there is a lot of real or manufactured kudos in
working for the Big G. Geeks wanted to work for them. They approached Google.
Google didn't have to try.

That, and it's a fun exciting place for young people, the bikes, free food
etc.

------
mavdi
Yet another reason for every semi-talented programmer to become a consultant.
They rob you of less money that way.

I'm certainly going to write to my MP about this. I think you should too. In
fact I think every programmer out there should be involved in bringing a class
action case against them.

------
adventured
"You can’t just free market part of the time. Good on Facebook for not being
party to the shenanigans."

I'm always fascinated by what people don't understand about free markets. The
author appears to think "free market" means lots of government enforced market
controls (which would be an obvious contradiction in terms).

In an actual free market, it's not illegal to collude to suppress wages, just
like it's not illegal for employees to form unions, leave for other better
jobs, or start their own companies to compete and pay superior wages to steal
talent.

In intentionally overly simplified terms, "free market" means a lack of, or
severe limitation of, government controls. How is it possible the author
doesn't know that?

~~~
matthewmacleod
_How is it possible the author doesn 't know that?_

Because you are (your words) using 'intentionally over-simplified terms.' A
free market is not simply one without _government controls_ , it's one without
_government controls or other de facto authority_ , such as price-setting
monopolies.

Excessive government regulation means a less free market. Similarly, excessive
monopoly control or cartel-like behaviour means a less free market. These are
similar forces; the market loses freedom because one group has excessive
control of it.

So, paradoxically, government regulation can result in a freer market - it's
more complex than you are claiming.

~~~
adventured
I disagree. Monopolies can only exist in free markets when force is applied,
eg by a corporation hiring thugs or militia to restrain the free market, and
the government fails to stop that use of force.

The only way a corporation can acquire de facto authority in a free market is
with violence (in which case they become a competitor with the government as
it regards rule of law). There is no other way they can literally hold back
competitors.

------
kagali
Proof positive that there is no shortage of people - just companies paying a
living wage.

------
outside1234
i mean, come of, of course they did. it was going to be like 99:1 in
Facebook's direction.

this isn't any shining beacon of ethics.

------
1010011010
So Google refused to hire Apple employees, but presumably didn't refuse to
hire Microsoft employees. What a bad move for their culture.

------
j_m_b
Could this have more to do with the fact that PHP/Javascript is the primary
language used at Facebook whereas it is pretty much language-spaghetti at
Google? Perhaps Zuckerberg figured that his technical culture didn't leave
much for Google to poach yet he wanted to soak up some talent from the likes
of Google. I kid, I kid!

------
friendzis
You all keep trashing companies for no-poaching agreements because it lowers
your wages. Let's look at this from perspective of employer. There are costs
associated with obtaining well performing employee: * Hiring: people spend
their hours filtering prospective employees. Usually HR does that, but bigger
companies have separate hiring department. Expensive. * Idling: newly
recruited employee rarely has intimate knowledge of all technologies, systems
used inside a company and surely has no idea how they are tied together. This
takes some months to grasp. Recruits often wreak havoc and as a result produce
very little net worth. And you greedy recruits want your 6 figure salary for
your havoc. * Training: employees are trained. Be it actual courses,
conferences or just unsuccessful internal startup its still training. And
having a team work on a doomed to be killed project for a year is again
expensive. In order to compensate for these no-worth-generating expenses
employers are left with 2 choices: lower the salary or invent a way to keep
the employee. Lower salaries are usually not an option because, well, who you
will hire then in the first place when rivals often much better packages?
Companies are left with an option to try and keep the employees.

In intimate atmosphere of Silicon Valey it is hard to keep employee
salaries/benefits and skills a secret, therefore it is much easier and cheaper
to contact employee of a rivaling company and offer a better mutually agreed
package. You either agree not to poach and let prospective employees go
through your normal hiring process or chain employees with timed contracts.

So just think that no-poaching agreements might be the thing keeping your
salaries that high.

------
xiaoma
Even without facebook, there would likely have been another mega-successful
startup springing up and ruining the hiring collusion. As long as incumbents
can't create a regulatory or legal moat (e.g. patents), I don't think these
kinds of salary depressing tactics will work for more than a few years at a
time.

------
dclowd9901
When I talk to other developers about this stuff and H1B exploitation, we all
seem categorically not in favor of collusion. These companies were started by
software developers. What the hell happens in the process of running a company
where you justify this kind of morality shift?

~~~
cgore
Where did you get the idea that software developers are the very definition of
moral paragons?

------
pyrrhotech
Engineers are still paid way too low for the massive value they add to these
companies.

------
weixiyen
so basically every company did the most logical thing for their own best
interests.

------
the_watcher
Looks like Facebook identified a market inefficiency, and chose to bet on
their ability to attract/acquire/retain talent over taking the defensive
stance that Google and Apple did. Bravo to Facebook.

------
higherpurpose
Is this a surprise? Facebook has been hiring Google employees for a while...

------
s3r3nity
Where are the calls for boycotting Google for doing something blatantly "evil"
and illegal?

Kudos for Facebook for doing the right thing here.

I'm just curious what ramifications this has, if any.

------
diminoten
I still don't get why this is news now, and not like 3 or 4 years ago. I knew
about this back then, and I'm some random nobody.

Is it because there's proof now?

------
drivingmenuts
"Don't be evil."

More like "Don't get caught."

------
hemantv
The one person I admire the most is Mark for being a rebel in the valley.

~~~
xcntktn
Don't worry, he's got his own strategy to keep programmers' salaries down:

[http://gawker.com/mark-zuckerbergs-self-serving-
immigration-...](http://gawker.com/mark-zuckerbergs-self-serving-immigration-
crusade-484912430)

~~~
philwelch
If all he wanted to do was keep programmers' salaries down, he could just as
easily open offices in India and China and employ people over there and pay
them even less than he would have to pay them if they immigrated to the US.
And as a large company that's an advantage Facebook has and their prospective
competitors lack. I'm sorry you feel insecure that more immigration might
threaten your ability to single-handedly earn three times as much as the
median American family, but literally every other human being other than
native-born American programmers is better off with this kind of immigration
reform.

~~~
esturk
That would mean Facebook would get the same quality of engineers in India vs.
grad students from India that are studying in US. Frankly, this is far from
the case. In fact, most grad students from India studying in the US are by far
of a higher quality than just a regular engineer in India.

From what you've written, you're equating engineers as commodities (as in they
are no different from each other), which is quite insulting to the actual
engineers here from India and China. They are just better and Facebook knows
this. They want the better quality and they are willing to pay more (than
those in India) for it, but they won't go so far as to greatly inflate the
salary of the entire software engineering occupation in America.

~~~
jsudhams
"Most grad students from India studying in the US are by far of a higher
quality" \--- This is completely wrong. The one who go to study abroad are
definitely are the TOP 10% at all in terms are talent and quality. It is only
that their parents were able to send them to additional tuitions (private
coach session apart from school time) and was educated and have money send
them. I myself know at least 100s students who are far better than those who
go to college in USA or other countries. Please note that exceptions are the
one who go to Stanford, Berkley and few top notch ones but even they only get
students who have money not the one who have passed excellent scores.

------
outside1234
Ten things we know to be true...

...make that nine things we know to be true...

------
0800899g
Pay fixing and chomski

------
mantrax3
Programming is not like being a cash register attendant at the supermarket (no
offense to these workers intended).

For programmers, getting into the workflow of a company, their existing
codebase, becoming efficient, it may take months.

Shipping a product may (and typically does) take over a year. The lifetime of
a product may be over a decade.

And if a developer quits mid-way through a project, they may derail the entire
project, while someone else has to spend the time, step into their shoes and
continue their work.

I honestly can't imagine the morality of someone who would just abandon their
project, their baby, so to speak, and go work somewhere else at the first call
from another company offering more money. Did they take the first job out of
desperation? We're talking top-of-the-top companies here. I doubt so.

Poaching employees like this is also very unfair to every company spending a
lot of resources to find the right employees, to build the right teams from
other channels, only to have the competition cold call them and take them away
after the former company has done the hard work.

There's also the problem of trade secrets. An employee who has spent some time
at, say, Apple, learns a lot about their product plans, processes, methods,
and so on. Getting those employees means that one way or another you get
access to these carefully kept trade secrets implicitly, if not explicitly.

Keeping wages down is bad, but employees who keep shifting jobs, leaving a
trail of destruction behind them is also bad.

How do we resolve both sides of the issue so everyone is happy?

~~~
rspeer
You're concerned that _people_ can be immoral because their economic decisions
are harmful to _corporations_? You're worried about whether both sides are
"happy" when one side is a corporation incapable of experiencing feelings? I
think you've lost track of what's important.

Your argument isn't just about cold-calling; you seem to be saying it's
"immoral" to consider switching jobs at all. But you are not in moral debt to
your employer. It is entirely reasonable to want a higher salary, and we
shouldn't cry for the corporations that have to pay it.

Switching jobs comes at a cost to the person, too. It involves breaking
professional connections and quite possibly relocating. It seems considerably
more disruptive to the life of the person who's switching jobs than to the
company who has to train someone else, so they're probably doing it for a good
reason.

Your life is more than your work. Your project is not your "baby". You might
have a _baby_ that's your baby.

I'm not sure what it means to take a job "out of desperation" if it doesn't
apply to basically everyone. Most people work because they need money. If
these people didn't need money, they wouldn't work for Apple or Google. Maybe
they'd start an unprofitable lifestyle business doing what they love. Maybe
they'd do something very fulfilling and very unprofitable, like teaching.

There is so much more that you can aspire to than advancing Google's bottom
line. If your goals align with Google's, it's entirely because of the
paycheck.

~~~
mantrax3
> You're concerned that people can be immoral because their economic decisions
> are harmful to corporations? You're worried about whether both sides are
> "happy" when one side is a corporation incapable of experiencing feelings? I
> think you've lost track of what's important.

I feel like your mind is playing a trick on you. Corporations don't exist as a
standalone entity. They're an aggregate entity - one that's made of _people_.

It's not corporations vs. people. It's people trying to be happy working with
other people who also are trying to be happy. We're all trying to work
together and build something that's bigger than any of us.

A corporation can't "feel", but it also can't "think", or "decide". The
_people_ in it feel, think and decide.

When people "harm the corporation", they hurt _other people_ whose hard work
gets diminished in the process.

Maybe you think management is "incapable of feeling", well, then sure, you
better leave that company. But I'm insulted by the implication that's the
rule, rather than the exception.

And also I'm insulted by the implication these companies are in it just for
the money. While Google and Apple, the two biggest companies mired in this
scandal are led by people with widely different world views, do you honestly
think they're in it just _for the money_?

Maybe you're letting your cynicism inform your opinions too much, or maybe
you're working for a company that really is focused just on money. But don't
speak for everyone.

~~~
rspeer
If you're not personifying corporations, I just don't understand who's
supposed to be "unhappy" when a worker gets a raise.

The person in payroll? It doesn't actually make them unhappy to put higher
numbers on a check.

Someone in management who sets budgets? Working with economic constraints is
their job. People I know in this role are _happy_ when they're able to give
raises, because their employees are happy.

The shareholders? Cry me a goddamn river.

Of course there are people who are passionate about their work at large
corporations, but you can't tell me that the large corporation is what they
would choose if they could do anything they wanted with their life and money
was no object.

