employee poaching (talent poaching) (original) (raw)

Employee poaching (talent poaching) or job poaching is the recruiting of employees who work at competing companies. The term "poaching" is associated with illegal hunting, but job poaching isn't, for the most part, unethical or illegal and can help to ensure a competitive job marketplace.

Increasing sophistication of recruitment management systems may be enabling employee poaching. Resume databases and social media tools make it easier to identify specific people. The more advanced tools will filter and rank prospects and automate the initial contact. If this door knocking works, a recruiter may call.

The ultimate defense against job poaching is a solid employee retention plan that ensures that pay rates are competitive and seeks a high level of employee engagement. But these aren't the only steps some employers will take to retain employees.

In 2015, the U.S. District Court in San Jose approved a $415 million settlement with Apple, Google, Intel and Adobe to end an anti-poaching case. A civil case alleged the firms had agreements "to abstain from actively soliciting each other's employees," according to court documents. This hurt the ability of affected employees to negotiate a pay increase or move to another employer, the lawsuit alleged.

HR360 provides an overview of pluses and risks associated with job poaching.

In a subsequent memo, the U.S. Dept. of Justice made it clear that job poaching was legal. The memo, titled "Antitrust Guidance for HR Professionals," said "it is unlawful for competitors to expressly or implicitly agree not to compete with one another, even if they are motivated by a desire to reduce costs. Therefore, HR professionals should take steps to ensure that interactions with other employers competing with them for employees do not result in an unlawful agreement not to compete on terms of employment."

Employee poaching is not without risks and ramifications. It may sour relations with a competitor. If the intent of the poaching is to gain confidential information about an employer or sales leads, the poaching may not only be unethical but result in litigation. Employers also have to carefully consider the terms of an employee's non-compete agreement.

Non-compete agreements now widespread

Another way businesses attempt deter employee poaching is with non-compete agreements. These agreements attempt to stop workers from immediately taking a job at a rival firm. The use of non-compete agreements is expanding.

In 2018, the U.S. government recently estimated that approximately 30 million workers -- or nearly one fifth of the workforce -- are covered by a non-compete agreement. These agreements were once typically used with senior executives, but even low-level employees are being asked to sign non-competes. A non-compete agreement can be onerous, and even apply to an employee who is laid off or fired without cause.

President Barack Obama's administration, in a 2016 report critical of non-compete agreements, said the evidence suggested that these agreements can keep workers from changing jobs as well as reduce their bargaining power.

The enforceability of non-compete agreements varies by states. Some states -- notably California -- treat non-compete agreements as unenforceable.

Internal employee poaching

Internal employee poaching refers to internal recruiting of employees. The idea is that the strongest candidate already works in the organization and will be the easiest to bring on board. Acceptance of internal employee job poaching varies from firm to firm. Many consider internal employees part of their talent pipeline.

Some employers believe there is an etiquette to this practice. Internal poachers should first raise the idea with the employee's manager before extending an offer to an internal employee.

This was last updated in July 2018

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