Murky world of recruitment gets DoJ probe

Anti-compete clauses anti-competitive

By John Oates • Get more from this author

Posted in Financial News, 3rd June 2009 09:20 GMT

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The US Justice Department is investigating Google, Yahoo!, Apple and Genentech to see if their employment practices break US competition laws.

The investigation is believed to be industry-wide. Tech firms are infamous for tying senior staff to contracts that preclude them from working for competitors for set periods of time. Sometimes this results in legal action: Microsoft and Google ended up in court fighting over Kai-Fu Lee, an ex-Microsoftie who wanted to join Google.

The usual deal is to send staff on "gardening leave" where they are paid to sit at home. But this investigation will also look at "no-poaching" agreements made between firms which could also be anti-competitive, the Washington Post reports.

US competition authorities are taking a more active and interventionist role under Obama than they ever did under Bush, bringing them more into line with European thinking on many competition issues.

The Federal Trade Commission is already investigating board members with potential conflicts of interest - like Google's boss Eric Schmidt who also sits on the board of Apple. ®

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