While Google CEO Eric Schmidt was on Apple’s board of directors, the two companies had an agreement not to hire away each other’s workers, a former Google employee with knowledge of such matters has told us. We have since confirmed this with other ex-Googlers. This was not a written agreement, and was considered non-official, but it was well-known and followed within the recruitment division of Google, we’re told.
This news follows a report by The Washington Post in early June that the Justice Department was looking into this very issue. That report cited sources close to the investigation stating that the government was looking for possible antitrust violations among several tech companies, including Google and Apple, with regard to their hiring policies. But that report didn’t say whether or not it was actually taking place. According to our sources, it is.
Or at least, it was. Another interesting element to this is that the main component of this understood agreement between the two companies was Schmidt’s position with each, one source tells us. Now that Schmidt has stepped down from Apple’s board of directors, that agreement may be off, they went on to say. It’s hard to know that for sure until actual hiring starts taking place, but one source says that both Google and Apple have been ramping up their staffing departments recently, presumably to make a bunch of hires.
To be clear, this unwritten agreement was that Google would not go after Apple employees, and vice versa. However, employees of both companies were free to apply to the other company on their own, we’re told. That’s a small, but important difference as the practice of going after other company’s talent, also known as “poaching”, is considered to be an important component of healthy competition in the market. That’s why the Justice Department is looking into it.
While plenty of tech companies have non-compete clauses that would seem to make poaching moot, both Apple and Google are headquartered in California, which is known for not recognizing non-compete portions of contracts.
This news comes amid much controversy between the two companies. The stated reason for Schmidt stepping down was the growing overlap the two companies have on the product side. But the FTC was (and still is) also looking into the overlap between Google and Apple on its board of directors. And more recently the FCC launched an inquiry into the relationship between Google and Apple (and AT&T) on Apple’s App Store. That followed Apple’s rejection of Google’s Google Voice app.
And it goes even deeper. A few months ago, there was a report (written by me, for another publication) that the reason Google didn’t put multi-touch support into its Android mobile operating system was because Apple asked it not to. More recently, Google admitted that it scrapped plans for a Latitude native iPhone app in favor of a web app because, yes, Apple asked it to.
We’ve reached out to both Google and Apple for comment on this latest matter, but have yet to hear back from either. We will update if we do.
Update: We’ve just received an email from a source that would seem to very directly confirm the agreement between Apple and Google in print. We’ve removed the names, a few details that could identify our source, and exact date, but the email was sent in the summer of last year.
From: XXXXX XXXXX <XXXXX@google.com>
Date: XXXXXXX XX, 2008 X:XX:XX AM PDT
Subject: Re: Google Opportunities- Follow up email…Thanks for getting back to me. I don’t believe that we have been in
contact previously – apologies if I am wrong about this.From your reference to the [APPLE DIVISION], I take it that you are
currently working there. If this is the case, we will not be able to
proceed with your application. Google has an agreement with Apple
that we will not cold call their staff. If you are not currently
working at Apple and are interested in learning more about [A GOOGLE DIVISION]
please let me know and I would be happy to chat with you.Thank you again for returning my email.
“Google has an agreement with Apple that we will not cold call their staff.” That would seem to once again confirm that Google was not allowed to poach Apple staff, but implies that they could have talked if it was the Apple employee who initially reached out (which wasn’t the case here).
[photo: flickr/mackz]
I heard that on the iPhone, http://www.google.com/voice is blocked: http://twitter....atus/3187333394
Great pic MG!
False.
I’m using me iPhone to read this right now and that link worked fine.
Ditto. I use mobile voice.google.com on my iPhone regularly. The lack of a native app is a shame, but it’s unfortunate that some people spread misinformation.
I believe people moving from Apple to Palm is going to hurt much more in future.
This is outrageous.
Is this an anti-dog-eat-dog rule?
i saw it as a lovely, cordial, way to do business.
i also saw it as a bend down and take it from the back door viewpoint…kinda like the apple+at&fail relationship.
I agree mertz –
Why on Earth would the DOJ need to get involved in this? Are they that bored over there?
Geeze!
hollym
http://www.thessayist.com
Is that photo from “iPhone The Musical”?
hahahaa. they could definately pass as theatre majors. that is the opra stance i see. can you imagine them singing?
that’s a good pic to go with this write up.
opra=opera
i think i’m going to make a vector using the pic. it’s too good to go to waste.
might as well fix “definitely” while you’re at it.
MG, Great story. I know the web works in realtime and all that, but next time post this kind of important story on a Monday morning, or at least a Sunday morning.
Nobody but nerds like me read blogs on a Friday night in August.
yeah, there’s a downside to real-time too, I suppose. but hey, nerds like you and me reading is good, also keeps the comments fairly civilized.
Neat… real news story by MG. Good job, dude!
OMG! you read?! that’s a shock.
and paraphrasing other outlets is news?!
How about some original reporting once in a blue moon?
i am not a nerd or a geek but i do agree with scott.
The heat is on.
Great story MG
And great poach, Michael (of MG — clearly Matt and you don’t have interlocking directorates). But a question for you as legal eagle — can’t the FTC just look at de facto recruitment (if significantly below what other flows were between these companies and other sources of employee hires, is the inter company flow too low to be explained with stats)? De jure, i leave up to you
“with regards to their hiring policies”
You are sending your regards to their hiring policies? Do you mean “with regard to their hiring policies”?
yes, thx, fixed.
Dear Arpie,
Don’t be a douche.
Regards,
Gina
Correcting other peoples mistakes doesn’t make you a douche. In fact, everyone can learn from it.
i do it when i can/want (which isn’t a lot) and i thank people who correct me all the time (which is a lot). i don’t take issue with it, but some people do. we just have to make allowances for people. i mean it’s not that i can’t spell ( yes i’m a bad speller. it’s a work in progress. here’s my cop out.) but sometimes i hit the worng key on my keyboard. it’s a crime to make mistakes. i saw the same thing “arpie” did. it’s not a big deal. it is to some people and it isn’t to others. it’s all relative.
being a douchebag is only attributed to true douchebags like christian audigier. ed hardy anyone?
worng=wrong
meh.. it’s a comment on a blog.. not like it’s your resume.
hahaha. so many people though are soooooo sensitive…which i guess i’m not. s’okay though. i actually do know how to write in complete sentences and use grammar.
We’ve done quite a bit of recruitment for Google and you are correct, we were steered away from approaching apple employees. We also had a list of colleges that were “Acceptable” for candidates educational background.
That’s disappointing to read.
yea.. doing real interview is too much work.
we’ll just take any fookin’ idiot out of some place we heard of, preferably with letters behind the names.
This employees swapping can control easily.Take the written agreement with employee up to 10 years.
Paige, Lexi, Brin!
At http://www.thessayist.com we believe that education empowers individuals with the ability to make wise and rational choices. Read here- http://bit.ly/ROA0K
I found this nice blog and read a lot in it – so I will visit it in future one time a week to read in it.
I read all about Google and Google products – good infos – thank you.
Greetings from Germany
Andreas
i wrote something else then deleted it because i realized i was kinda pissed about this and understood that lost feeling the social media users had over this dos attack. i don’t think it’s normal the feelings i have about this so i am going to just start on my google detox now and make sure all the family members and friends i have converted into google fans since ‘97/98 can now join me in maybe embracing microsoft or an alternative to google. i have no loyalty to apple so i could care less about how they don’t want/like direct competition. i just thought google was better. i wonder if this is how they’ve been working with microsoft.
there were options before google and i guess i have to move on. why the hell are they putting apple interests above theirs? to establish a meaningful and reciprocal relationship? what, did apple threaten them with their appletalk legal team? it’s so nice they ask each other things. that’s how business should always be done…by asking. all these cross-relationships. i guess this is how you do it in business. i hope this isn’t true and i can continue to blind myself to how business is really done. maybe google is benefiting from this.
i’m even okay with the whole sources say this agreement is on or was on clarification with trying to estbalish a timeline.
thanks mcg.
you’d be less stressed out if you realize you’re pontificating in a room full of deaf people.
yeah i get the feeling. i mean i may be a noob here and i may not understand all the talk, but i’m not that stupid.
i guess i have to give up on my google love for real now. i was so looking to switching to chrome. shit.
Let’s face it, even if there was a tacit agreement in place between Google and Apple execs, nothing should stop someone from expressing interest in potentially working elsewhere.
There is still an imbalance between employee rights when it comes to things like intellectual property ownership, fair treatment and opportunity.
A new type of company has to emerge where wealth and opportunity are more evenly distributed and legal threats and gates are eliminated.
Surely there is some anti-trust law that prevents companies from agreeing not to hire workers away from each other? What ever happened to free enterprise?
Whats up with that?
Looks like “monopolistic Microsoft” of the 90s was an angel compared to where Google & Apple are headed
this unmasks Google. They have become the EVIL EMPIRE!
cue the imperial march.
i think it fits.
or beethoven’s 5th symphony.
Honestly, it sounds to me like this could be a good reason to fire someone down the road( Eric Schmidt). Google is doing great now, but if the tide ever turns, this incident won’t be forgotten. There is too much negative press and Eric Schmidt is at the center of it.
It’s time to ban the practice of interlocking boards in publicly traded companies. It breeds insider trading, anti-competitive behavior, and groupthink at the highest levels. It’s detrimental to shareholders and consumers alike and serves only to concentrate corporate control among a small group of individuals.
I suspect that anti-competitive hiring practices are a lot more widespread throughout the valley. I was once told by someone who I think is credible that Sequoia has a spreadsheet which they use to standardize salaries across all of their companies. Even some non-Sequoia companies use it. I’d like to see the DOJ get its hands on that.
very true. recruiters will tell you that they will not poach employees between sequoia companies.
This seems like the US teaming up with “the Communists” back in WWII. In this case, Google and Apple both want to see Microsoft’s market share dwindle.
They probably had no intention of working with each other like this long-term—it’s probably a temporary truce to dethrone the current king of the hill.
Its going to happen whether they like it or not. They employ head hunters to find them staff.
This is a sad report. Hiring should be hiring, and back room deals like this dilute competition and fairness for everyone else.
O.K This makes sense. I suppose they both want to be tension free from another. Any how a good move.
Really Folks……An agreement to not recruit each others employees is a hard stretch to call a crime. The door is clearly open for any employee to seek employment at either company. There was no rule barring seeking emplyment at either company.
It’s not uncommon the such agreements exist in many industries.
The e-mail submitted here states exactly what was possible. If those words are too difficult for any potential executive too understand that all they would have to do is intiate contact, then, they aren’t sharp enough to be an executive anyway.
Is this really news? Of course companies have informal unenforceable agreements like this all the time. Note, though, anything more than this would likely be illegal under California law business and professions code — which is QUITE protective of workers rights to move, btw.
All of this outrage is a little silly
Well with his employee of both companies will be at loss
I am not a lawyer but I think this might be illegal in California. Same as non-compete agreements.
What a major yawner.
Crazy ……..
Aren’t you guys yet bored of that Jobs/Schmidt Image? Must’ve seen it on techcrunch like a thousand times now.
Very good article, thanks
If it’s a only a matter of internal policy then it’s probably not illegal. They simply don’t want the other guy poaching their employees. As long as there isn’t any agreement between the companies, it’s legal. Any employee at either of these companies should have an easy time getting a job at the other. If they won’t consider candidates from the other company that could also be illegal.
I am a Dell employee and I know at certain levels at DELL; Microsoft, Oracle, EMC and Intel have been asked not to hire. A no-hire agreement actually exists. In Dell Asia Pacific and in countries like India, Australia and CHina, this is actually a huge thing. Though CEO’s can of course “cross-pollinate” as it were
yeah same for dell here.
Written email. That’s it. They are screwed.
I experienced the same, back in 2006.
********************
Hi [REDACTED],
Thanks for the note back. We definitely have some exciting Mac development opportunities at Google. I can’t be too specific about them because our projects are constantly changing. Also, I didn’t realize you worked at Apple. Apple is a great company and I am sure you are doing
very exciting work there. However, Google and Apple are under a non-solicit agreement, so unfortunately I can’t contact you directly for employment. If you would like to look more into some of our positions for your own interest, the link is : http://www.goog...amp;loc_id=1116 In the meantime, if you do know of any other great software engineers that might be interested in working at Google, please don’t hesitate to pass along my information. I wish you all the best in your work
moving forward.
Regards,
[REDACTED]
Technical Sourcer
My law firm is investigating the possible antitrust ramifications of this. A no-poaching agreement, if formed, could theoretically operate to depress the wages and benefits paid to the companies’ existing employees (not just those who tried to apply for a job and were turned down). If such an agreement was formed as alleged, that effect could be what motivated it, and it may have violated California (and federal) antitrust laws. We would be interested in talking to anyone with information about the alleged agreement, particularly those who received email from one of the companies mentioning such an agreement. For more information on our investigation and to contact us, please visit this page: http://www.schu...i-poaching.html
Yes, There is no HIRE agreement b/w DELL india and Microsoft Hyderabad. They have become bai bais