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How Silicon Valley CEOs Conspired To Suppress Engineers' Wages 462

Posted by Soulskill
from the ungentlemen's-agreement dept.
Oneflower writes "As we discussed last week, a lawsuit is moving forward that alleges widespread conspiracy among the CEOs of Apple, Google, Intel, Adobe, Intuit, and Pixar to suppress the wages of their tech staff. Mark Ames at Pando explains how it happened, and showcases some of the emails involving Steve Jobs and other CEOs. Quoting: 'Shortly after sealing the pact with Google, Jobs strong-armed Adobe into joining after he complained to CEO Bruce Chizen that Adobe was recruiting Apple’s employees. Chizen sheepishly responded that he thought only a small class of employees were off-limits: "I thought we agreed not to recruit any senior level employees. I would propose we keep it that way. Open to discuss. It would be good to agree." Jobs responded by threatening war: "OK, I’ll tell our recruiters they are free to approach any Adobe employee who is not a Sr. Director or VP. Am I understanding your position correctly?" Adobe’s Chizen immediately backed down.'"
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How Silicon Valley CEOs Conspired To Suppress Engineers' Wages

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  • by Anonymous Coward on Friday January 24, 2014 @02:33PM (#46058829)

    As a Technical Director (read: Guy in charge of a group of programmers), I know our company had similar agreements with other programming studios and technical firms in the geographical area we were located in. I learned of it by a slip of the tongue by our HR Director during a meeting.

    I responded along the lines of "Well, if we would pay our programmers what they're worth after 3 years, instead of insisting on keeping them at Junior programmer rates, then we don't have a problem, and shouldn't need special back room deals to keep our talent". I unfortunately did not have the final say in pay increases, and did lose some of my staff to better payment offers. It was all I could do to compensate with treating the team with the highest levels of respect to keep them around due to shitty pay.

    This was happening in Canada for context.

  • Re:Anti-Capitalistic (Score:4, Interesting)

    by Ichijo (607641) on Friday January 24, 2014 @02:37PM (#46058875) Homepage Journal

    Company prohibitions against employees sharing salary information are also anti-capitalistic because they create information asymmetry.

  • Re:So, cue up.. (Score:5, Interesting)

    by NatasRevol (731260) on Friday January 24, 2014 @02:46PM (#46059007) Journal

    Collusion, by definition, is a free market.

    And it's where markets will always go if the power players in the market are friendly/courteous rivals. It helps those at the top.

    And it's exactly why truly free markets aren't good for the average person.

  • It's not about wages (Score:4, Interesting)

    by goombah99 (560566) on Friday January 24, 2014 @02:52PM (#46059079)

    I suspect that this was not overtly about wages. It was about retention. You can't just say, well they could have paid them more to retain them. As the e-mails indicate regardless of any feasible wages it would always be possible to offer higher wages to a subset of employees that could cripple the organization. That's what this was about. People are not simply interchangeable. When you hire someone it's also an investment of your core strength into them. So in the short term yes perhaps a few employees could have been enticed by higher wages but then ensuing self destructive battle would have damaged all the companies fitness, lowering everyones wages. So it's not a give this lowered wages.

    This is one problem that collective bargaining does address. It tries to maximize employee wages over the long run and side effect is that trade unions also normlaize wages across all the companies. But the union is always balancing a companies ability to pay with killing the golden goose.

  • by mark_reh (2015546) on Friday January 24, 2014 @03:00PM (#46059193) Journal

    and this stuff was going on back then. They actually told employees they were doing it at the meetings where they announced annual pay raises. My coworkers cheered while I was dumbfounded that people missed the big picture. In essence they were saying "we've fixed engineer salaries with other big employers in the area so don't bother looking to get a better deal elsewhere".

    When I left HP I went to work for Fujitsu- they didn't participate in the salary fixing- and instantly got 40% pay increase and kept my vacation time.

  • by Penguinisto (415985) on Friday January 24, 2014 @05:40PM (#46061447) Journal

    Understood completely... and yes, oftentimes there are some real bullshit questions at an interview. On the other hand, to be fair, some of them are designed to gauge how well you fit into the company culture. As a candidate, I usually use those questions (and their reactions to my answers) as a cue to see how well I would fit in as well. That part is kinda vital to the success of both the employee and the company (I've worked at places which has some rather toxic cultures... sucks to say the least.)

    As for the search? I guess the hardest part is finding a person who is a technical wizard who can fluently speak Stakeholder. Our company's org chart is rather flat for our size (trust me, I like that - only two human beings sit betwixt me and the CEO), so you not only have to know how to deliver the solution, but you don't get a filter between you and the people who want that solution. And yeah, we're willing to pay well above average around here for such people. Why? Because the act of hiring is a soul-grinding time-suck, and having to do it repeatedly would suck even more; I'd rather be tinkering with stuff.

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