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On Wednesday, US District Judge Lucy Koh granted preliminary approval for a settlement between four top tech companies—Apple, Google, Adobe, and Intel—and their former employees. The employees launched a class action suit against the companies after the Justice Department sued the top tech firms for anti-competitive labor practices in 2010.
The Justice Department had accused Apple, Google, and other top tech firms of agreeing not to approach each others’ engineers with better employment offers. The employees estimated that they collectively lost out on $3 billion in wages because competing companies would not give them better offers.
Employees of Apple, Google, Adobe, and Intel pursued a larger settlement [...]. Originally, lawyers for the two sides agreed to a $324.5 million settlement for the employees. But with 64,000 former employees looking to reclaim lost wages, that amounted to a paltry $5,000 per person. Freelance programmer and representative plaintiff Michael Devine protested the agreement his side’s lawyers agreed to, and Judge Koh agreed with him, calling the settlement "below the range of reasonableness.”
(Score: 5, Insightful) by MrGuy on Thursday March 05 2015, @07:50PM
They lost a lot more than that. These employees likely have a lower standard of living for life because of this. And, no, that's not hyperbole. Because (in most jobs) your salary isn't determined by "what you're worth" so much as "how much did we pay you before" and some raise percentage. This is even true when changing jobs - many companies ask for a salary history and will offer something accordingly.
Let's say an engineer at Apple was making $100k/yr, and there was a position at Google for $120k/yr that the engineer would have been a good fit for, but wasn't offered due to the bad conduct. Instead, the engineer took a job elsewhere for $110k/yr.
All else equal, that loss of salary will stick with the engineer through the rest of their career. Because if a "good job" performance rating is a 5% raise, then the engineer gets a smaller raise with the smaller base salary. They'll never "catch up" to where the earnings would have been if they'd gotten the larger base salary. The first year, the engineer will have lost $10k. The second year, they have lost MORE than $10k (because of the smaller raise), and the next year lost more still, compared to where they would be at a higher base.
Even if the engineer moves on to another company, the salary negotiations will likely start at and end at a lower point than they would have if the engineer made more.
Even if the new job is "better" and the engineer is happier than they would have been at Google, having that offer from Google would have given them more salary leverage and likely a higher base (maybe they could have negotiated to $115k instead of $110k).
Robbing employees (and that's what this is - theft) of the leverage to seek and receive a higher salary is a decision with long-lasting consequences for the employee.
(Score: 2, Informative) by Anonymous Coward on Thursday March 05 2015, @10:03PM
> This is even true when changing jobs - many companies ask for a salary history and will offer something accordingly.
Not in silicon valley they don't. I've never encountered that. And if I did, I would lie my ass off because they have no way to independently verify without breaking the law. Company hopping is the standard way to get a raise here.