Imagine you’re unhappy in your job, and you’re looking to switch companies. In tech, this is usually pretty easy: Companies are so desperate for engineers and software developers that you’re bound to be able to walk into a position at a similar, competing company.
Now imagine that your boss had made phone calls and sent emails to prevent you from working at a competitor. In fact, your boss had, for years, been making sure that any company that might be interested in hiring you won’t come anywhere near you.
Let’s say one of these emails from your boss told other companies “that means war” if they approached you.
You’d be pretty angry. Your boss is basically trying to screw you out of a new job.
Now imagine that this went on for the better part of a decade, and the agreements were between Apple, Google, Intel, and dozens of other tech companies.
In fact, this did happen, according to a massive antitrust class action lawsuit that claims Apple, Google and others secretly colluded to keep down the salaries of tens of thousands of tech workers by agreeing not to recruit from each other’s companies. It affects 64,000 Silicon Valley workers whose lost wages add up to $US3 billion. If the case goes to trial and the companies lose, damages could be tripled to $US9 billion. Initial small settlements have resulted in cash payouts of $US20,000 to each affected employee.
The case could be settled this week, according to The New York Times.
If that happens, a huge cash bonanza will fall into the wallets of 64,000 workers, mostly in Northern California.
It’s a distinct possibility because the facts in the case leave little room for interpretation. You can read the emails between Apple founder Steve Job, Google founder Sergey Brin and his chairman, Eric Schmidt here and here. The case hinges, therefore, on the court’s interpretation of the law as it applies to those facts.
So far, the litigation has not favoured the companies. They entered a settlement with the U.S. Department of Justice in 2010 which required them to stop the collusion. In the class action suit, a judge has already agreed the case merits class action status. That is a crucial hurdle in the case because the technical definition of a “class” is often difficult to meet. The fact that the class has been approved suggests the judge is so far unimpressed with the company’s defence.
The litigation has also been humiliating for Apple. Lawyers for the company have tried to persuade the court that Jobs emails should be excluded from the case because they make him look like a bully. But that’s what the entire case is about: whether Jobs bullied Google into not hiring his people. Emails from Brin suggest that’s exactly what happened. They show Brin complaining that an “irate” Jobs kept calling him until he agreed to fire a Google recruiter who was trying to poach Apple staff.
And, of course, it’s an open secret that pay at Apple is lower than comparable companies. Usually this is attributed to the fact that so many people want to work at Apple that the company doesn’t need to use money as an incentive.
We’ll find out soon if that was the only thing keeping salaries down.