A raft of US tech and film giants, including Apple, Google and Pixar, have been sued for anti-competitive behaviour after allegedly undertaking employee wage-fixing and agreeing not to poach each other’s staff.
The move follows a probe by the US Department of Justice last year, which resulted in the firms, which also include Lucasfilm, Intel and Intuit, vowing to end any anti-competitive agreements.
No employee compensation was awarded, however, which is why a class action lawsuit has now been filed by Siddharth Hariharan, a former software engineer at Lucasfilm and founder and chief executive of InEarth.
The suit claims that the named organisations violated anti-trust laws by conspiring to fix the pay of their employees and entering into ‘No Solicitation’ agreements with each other over a four year period from 2005 to 2009. The claims are based on three premises.
Firstly, it is alleged that agreements were put in place not to actively recruit each other’s staff. Secondly, the firms involved would notify each other when making a job offer to another’s employee without the knowledge or consent of the individual concerned.
Thirdly, agreements were introduced to cap the pay packages offered to prospective employees at the initial offer stage. Such activity, it is claimed, led to reduced competition for skilled labour, keeping wages artificially low.
The aim of the suit is to seek restitution for lost wages and treble damages for anti-competitive employment practices for staff across the country who were allegedly “harmed by defendants’ unlawful agreements”.
Harihan, who has appointed law firm Lieff Cabraser Heimann & Bernstein to represent him, said that, “while we were working hard to make terrific products that resulted in enormous profits for Lucasfilm, senior executives of the company cut deals with other premiere high tech companies to eliminate competition and cap pay for skilled employees”.
His lawyer Joseph Saveri estimated that, because of reduced competition for their services, staff renumeration at the companies concerned was between 10-15% lower than it should have been. “These companies owe their tremendous successes to the sacrifices and hard work of their employees, and must take responsibility for their misconduct,” he said.
