Emails From Schmidt And Sergey Brin Show Agreements Not To Hire Apple Workers

It's all propaganda plastered with a nice marmalade of feel goody "let's help the immigrants", or "everything great about our country came from immigrants", or other such variants of rhetoric. It's actually very smart, because it plays to the tune that people dance to.

That said immigration policies do need to change, and immigration is indeed a good thing for this country. Attracting talent is a lot of what makes this country great, but we need to be careful with the fine print of such policies as to not destroy our own economy.

Don't be fooled by altruistic PR coming from Zuck and others...

How does someone this stupid rise to such a high position of wealth and influence? Are we talking luck here, or are Faustian bargains involved? Where do I get some of that action?

I'm only being half-facetious; this is weapons grade stupid. "Let's take this conversation offline because we'll get sued or indicted if it gets out." Yeah, that will totally work in a grand jury room.

If low IQ isn't the explanation, and I don't see how it could be -- given the respect and reputation we all accord Eric Schmidt for his other achievements -- what is? Drugs? Mental illness? Distraction? Forgery? Did he fail a saving throw versus reality distortion on one of his walks on the beach with Jobs? What?

> Maybe if CEO's weren't illegally conspiring to drive wages below their market value, there wouldn't be a so-called "engineer shortage"?

What illegally driven-down wages mean is that the shortage is more acute that previously thought. That's because the main way to measure the relationship of supply and demand is through price; i.e. the more the salaries grow, the less supply there is relative to demand. So if salaries have been held down, some of that evidence was masked.

Secondly, it means that non-giant companies could be competitive in making job offers, whereas perhaps in a more free labor market they might not be able to compete salarywise with Google, Apple, Microsoft, etc. Thus, as seen from say, a startup's vantage point, this check on the upward price pressure actually kept the supply of affordable engineers up.

So I remain sympathetic to the there-aren't-enough-programmers line of thinking, and certainly don't think of this as hypocritical or antithetical to that line. Of course, that doesn't excuse any of Google's behavior here; they've effectively stolen a great deal of money from all of us through illegal collusion, pocketing the money that an honest market would direct into the engineers' bank accounts. I hope there's hell to pay.

Edit: I suppose it's theoretically possible that if the salaries went up to their natural levels, then people would pour into the field, and perhaps that's what you're trying to say. I think that's very unlikely, since software engineers are already paid a great deal more than most fields, so these people are either people who don't care about money unless it's a lot of money, or they're people who instead chose to be doctors and lawyers. I'm sure more people would say, "hmm, maybe I should be a programmer", but you have to ask why those people aren't doing it now. As economists might put it, this is a structural problem, not a market problem (I hope I'm using those terms right).

I'm sure there will be apologetics, but it's not like one side was behaving ethically.

They conspire illegally to drive down wages, then whine that not enough people want to work in this field where wages have been artificially and illegally deflated.

This field where wages are still significantly above mean values? Where are these engineers going to go en masse for better wages? Into medicine? Hello for another 10 years training. Law? Already overstaffed, and wages are similar for most anyway. Finance gets some, but isn't going to hold them all. If the engineers are in the career for the dollar, restarting in another career that will pay more is going to be difficult as a group.

"For each of these 'Restricted Hiring' companies...

"3. Additionally there are _no_ restrictions at _any_ level for engeineering candidates"

The majority of the companies included were just on a "Do Not Cold Call" list, but Google would actively recruit people from those companies based on referrals, and of course based on applications.

So, if you worked at Apple and applied to Google, Google would actively recruit you.

I fail to see how this policy has anything to do with an engineering shortage. It may well be deemed illegal, but it's certainly not as bad as you're making it out to be.

The whole conspiracy has not been driven by a desire to bring down wages (most of the involved company can pay the price), but by the instability caused by an already existing shortage.

Yes, driving down wages only makes the issue worse, and lobbying for migrant workers whilst doing so is extremely hypocritical.

But at the end of the day it's a symptom of the problem, not the root cause.

Yes, Google's "don't be evil" mantra is tempting low hanging fruit. They dropped the ball here, but so did most of the valley. Nobody should be getting free passes in the court of public opinion.

It's evil collusion to keep salaries down.

Not discussing your compensation is another example of something we've been sold on as "common sense and civility" though it's illegal to restrict it.

Finally, the notion that this was an individual thing and there were no class impact is not so. The reason is that these companies have "brackets" for pay. If you are at a certain job title you make $X - $Y and corresponding amounts for options etc. These companies are also very interested in equity among the employees so if prices start rising they will have to draw up the low end affecting prices across the board.

To the doubters, I point to the Facebook/google incident. Google was forced to give across the board 10% raises to every single employee because Facebook wasn't willing to sign anti poaching agreements.

It's interesting that arguments essentially from das kapital are being raised here. Wages vs productivity. Intrinsic ideas of fairness are universal (and possible primate, studies showed).

Google is in a weak position here.

The way your leverage mutually assured destruction here is just sugar coating the very nature of collusion like the telecomm companies. When no one lowers prices and compete fairly, the customers (and by analogy the programmers) loses out. So it doesn't just /look/ like evil collusion because it /is/ evil collusion.

I just wanted to clarify to anyone reading this passage here.

This must not have been true, if collusion was necessary to keep wages down.

> We, as programmers, are ridiculously overpaid already. How could anyone possibly be "taking advantage" of us at these salaries?

Overpaid by what metric? Compared to society at large, you make a lot money, yes, but you're also contributing significantly to one of the most profitable companies in the world. Google has a profit of about a million dollars per employee per year; why aren't you capturing more of that? [1]

If you're not taking that money home, someone else is. What do you bet those people are the ones telling you this is all in the name of civility?

[1] E.g. https://signalvnoise.com/posts/2283-ranking-tech-companies-b... I confess I don't know the numbers for 2005, but it should be easy to look up.

Another kind of "fairly" is that Labour is its own market, and employees should be paid commensurate to their replacement cost.

Both are valid models, though the latter is much more common. The difference between which model is followed can often come down to the negotiation abilities of the individual employee (or their agents) and their relative scarcity. E.g. an extra for a hollywood blockbuster movie is paid the same daily rate as an extra on an independent art-house film - because it's easy to hire extras and they are interchangeable. The movie stars on the other hand are more scarce (at least those with marketable reputations are) and so can negotiate points on the gross.

What I find interesting in this whole story is the value that these executives put on the teams they have built. Of all of the things that Steve Jobs could be worried about as the CEO of one of the largest companies in the world, he's spending his time stressing about losing a few engineers to Google? As an engineer this makes me happy, but I still find it a bit surprising.

These executives knew an agreement like this would have to be delegated to a vast number of people. To me this means they didn't think it was a big deal. I say that because if they were doing something they viewed as extremely illegal they would have been concerned that someone in the delegation path would blow the whistle. Seems to be a crisis of perspective at that top.

I find this agreement and the Facebook sponsored stories feature baffling. They remind me of when Korean companies have gotten caught up in price fixing and invoked the excuse "we had no idea this would be illegal!"

There should be no issue in people hiring from each other and thus no need to make agreements behind everyones backs.

If the execs didn't think what they were doing is bad, why did another major CEO refuse citing that it's probably illegal? why did they take efforts to hide it from the public and employees?

Tariffs aren't done in secret, nor is there a lack of public input on the practice.

One way to look at anti-competitive rules is that the point isn't to protect companies at all. In the steel case, the point is that dumping will destroy the American industry and then--this is the crucial part--China can hike up its prices way above current levels because there's no competition. If China couldn't do that for whatever reason, then that would be great for American consumers, who would benefit from cheaper steel, and--in principle at least--the competition rules would do nothing about it. In other words, in theory, the law doesn't care about the American steel industry; it only cares about the long-term well-being of steel consumers, which requires sane pricing. That industries have co-opted that in all sorts of ways to ironically entrench their positions in anti-competitive ways should not distract you from the core purpose of the rules.

So applying that here, since the rules in question are meant to protect the workers, the problem would be if Google were hiring all these people to destroy Apple and then be able to slash salaries, since no one would have anywhere else to go. Since that strikes me as implausible, and at the very least not established, I can't see how we can think of Google's poaching as anti-competitive.

[1] I'm not sure I buy the US steel argument either, but that's a separate discussion.

Mostly, the last thing any of us wants is a select group of dominant companies making a collective decision for the industry.

what's more astounding is that eric deliberately says in an email to send the message orally so they don't get sued

1. That was a lie. Perhaps I'm naive, but I would expect him to say that he's not going to discuss the Google product line-up.

2. They were not building a browser, but Steve's accusation got them thinking about building a browser.

3. They were not building a browser, but later decided to build a browser.

http://pando.com/2014/03/22/revealed-apple-and-googles-wage-...

1) keeping wages suppressed might be a good thing for the regional economy and long-term health of the tech industry

2) tech workers are already well compensated

Those are fair opinions, but the behavior described is still illegal. This is one of those situations where we can't have it both ways.

There has been plenty of evidence over the past 12 months that there was exactly such an agreement "not to hire people who apply".

>I'm somewhat sympathetic to the notion that companies want to avoid aggressive and invasive poaching on each other's workforces...

>If I had a startup, I'd be pissed of someone came along (and poached my employees instead of an acqui-hire) that I spent significant amounts of resources recruiting and training...

I find the term "poaching" in this context to be disgusting. Employees aren't game captured by underhanded or illicit tactics. Employees are human beings that think and make decisions for themselves, and talk of them being "poached" as if it wasn't their choice is offensive.

>There's already an apparent bubble in asset prices and cost of living in the Bay Area

House prices are artificially high because of NIMBY zoning laws set by the very wealthy , and NOT the tech employees in question. The strata of middle class are being pitted against each other by the wealthy.

> and while it seems good for some tech workers in the short term to have salaries pumped through the roof, I'm not sure it's good for the overall tech economy, or the economy in general.

When a company keeps the money instead of paying its employees, the money is funneled to stockholders, who are in general richer and fewer in number than the employees. Are you seriously suggesting, in spite of the abject failure of trickle down economics, that giving money to the middle class tech workers instead of the wealthy (owners of the company, and shareholders) is bad for the economy?

>To read some of the press articles, you'd think this was the Grapes of Wrath or something, that poor tech workers, the ones who drive around in luxury busses and pay $3000-5000/mo for studio apartments in SF, are woefully under compensated

"No poaching agreements" ineluctably means THEFT. $10,000 a year extra is a lot of money for tech workers and their families. The victims were skilled workers that were deserving of the pay stolen from them. Your suggestion that we shouldn't empathize with any victims of theft if they're not destitute is fatuous and offensive.

No, they're not. This is anti-competitive wage suppression. It's illegal.

> Are you free to use the power of the state to try an boost your salary? I don't think you should be able to do that. But apparently many people do.

Pretty sure that's illegal too.

Too many on the right seem to think it's bad when the government does something but have no problem when corporations do the same. But in reality a government is just a bunch of people agreeing to act in certain ways, just as a corporation is.

If you want some evidence to back that hypothesis: the e-mails you're talking about right now are encrypted. They're encrypted inside Google's servers. But it doesn't matter in the face of a court order. It's not like the Justice Department accessed these files that are being reported on with wireshark.

I'd be worried to admit that I signed up for free pack of crisps from two different emails breaking T&C

My tweet: https://twitter.com/stefek99/status/448045158836097024

What the hell were they thinking?

I just wonder if anyone will go to prison... And how will stakeholders / stock market react?

The companies may not benefit, but the developers certainly will! Not just the ones being moved around, either --- it'll raise market prices, and so _every_ developer will benefit, even those who don't move.

[1] http://en.m.wikipedia.org/wiki/Eric_Schmidt

My first reaction when reading this was "well, duh". However, I just noticed that the title of the piece is incorrect. That's BI's bad, they should know better.

There's one group of people who do benefit from this - employees themselves. The positive feedback loop that comes of such zero-sum scenario raises the salaries of developers and also gives them an advantage when negotiating compensation.

I do side with the companies on this one - such practices waste lots of resources and reduce the quality of company's output, so the society at large loses.

In fact, if you only consider the companies (and not the employees), this kind of competition is negative sum, not zero sum, which is kind of the point.

1) Big companies 'move employees around' 2) Industry salaries increase as a result 3) Supply of engineers increases as result of increased demand signaled by the higher salaries 4) Everybody benefits from influx of new talent

The 'new talent' is going to come regardless. It's the salaries in the industry that determine the quantity and quality of those new entrants over the long term.

It's an anti-competitive business practice, plain and simple.

If the issue doesn't clear up within the week, please seek further guidance from a licensed professional.

I don't agree with the statement but it does represent a possible solution - all companies involved in this should have their employees go on strike!

People think this idea is ridiculous because they've been told it is over and over and over again. Are unions really evil or are they ever more necessary to balance out the insane profits companies are making?

Just some questions worth thinking about before you arbitrarily down-vote someone...