The U.S. Department of Justice is currently looking into a class-action lawsuit that claims that employees of several Silicon Valley technology companies had their salaries and compensations unfairly capped by overly restrictive pacts between companies not to recruit each other’s employees. The plaintiffs include employees of Google, Adobe, Lucasfilm, Apple, Intel, Pixar and Intuit. The lead plaintiff is a man who used to be employed by Lucasfilm and is now the founder and CEO of his own company.
The lawsuit claims that the companies violated antitrust laws by participating in “no solicitation” agreements. The lawsuit claims that the agreements not to recruit each other’s employees resulted in employee pay being reduced by 10 to 15 percent since companies did not have to as actively compete for the best talent.
According to PC Magazine, the lawsuit also claims that there was an agreement between the technology companies to tell each other before making an offer to the other company’s employee. This was allegedly done without the consent or knowledge of the worker. The lawsuit also claims that pay caps were established between the companies in order to limit what a company would offer a potential employee.
The Department of Justice and the Federal Trade Commission have both looked into these allegations and have found evidence that this kind of behavior occurred among the employers and the companies’ boards. The companies have agreed to stop this restricting of employee compensation. The class-action lawsuit is seeking compensation for the workers whose pay was capped in violation of antitrust laws.
Apple, Intel, Google, Others Allegedly Conspired to Stiff Workers (PC Magazine)