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The Silicon Valley cartel
January 24, 2014 7:37 AM   Subscribe

Mark Ames on Silicon Valley's conspiracy to drive down workers' wages:
In early 2005, as demand for Silicon Valley engineers began booming, Apple’s Steve Jobs sealed a secret and illegal pact with Google’s Eric Schmidt to artificially push their workers wages lower by agreeing not to recruit each other’s employees, sharing wage scale information, and punishing violators.... The secret wage-theft agreements between Apple, Google, Intel, Adobe, Intuit, and Pixar (now owned by Disney) are described in court papers obtained by PandoDaily as “an overarching conspiracy” in violation of the Sherman Antitrust Act and the Clayton Antitrust Act....

The court order certifying a class of plaintiffs contains additional background.
posted by enn (95 comments total) 25 users marked this as a favorite

 
Same as it ever was. Bizniss will always try to keep as much of the revenue for itself as possible. This is why we need laws against collusion, strong union laws, and full employment.
posted by Mental Wimp at 7:43 AM on January 24 [19 favorites]


I hate having to go to Pando to read the former NSFW Corp writers, and I hate the legitimacy their presence lends to Pando.
posted by Pope Guilty at 7:46 AM on January 24


So much for it being easier to get a job if you have a job. Peeps at a company that I'm surprised isn't named in the lawsuit was bitching about wages being weirdly flat starting about 2004 or so.

Then again, I'm now making again about what I did in 2004 or so. :( Three squares a day and health insurance but it's a bit tougher than it was then. But it's nice to have one again. Great Recession was hard, though preplanning/saving helped during the worst of it loads.
posted by tilde at 7:46 AM on January 24 [1 favorite]


Steve Jobs, who took regular Sunday walks with Campbell near their Palo Alto homes, valued Campbell for his ability “to get A and B work out of people,” gushing that the conduit at the center of the $9 billion wage theft suit, “loves people, and he loves growing people.”

Like mushrooms?

Is that another thing just about everyone knew about, but had no hard evidence?
posted by hat_eater at 7:47 AM on January 24 [4 favorites]


The world would change for the better if everyone's annual income was public knowledge.
posted by pracowity at 7:48 AM on January 24 [17 favorites]


I hate having to go to Pando to read the former NSFW Corp writers, and I hate the legitimacy their presence lends to Pando.

it's kind of an ignomious 3rd act for the eXile, but you could tell they had sold out when they barely mentioned (if at all) the brief BART strike.
posted by ennui.bz at 7:52 AM on January 24


(for ironic values of the phrase "sold out")
posted by ennui.bz at 7:53 AM on January 24


The world would change for the better if everyone's annual income was public knowledge.
posted by MuffinMan at 7:54 AM on January 24 [13 favorites]


This is so sad, just think of all of the cupcakes that have gone uneaten.
posted by sparklemotion at 7:59 AM on January 24


yay, business 9_9
posted by rebent at 8:02 AM on January 24


Wow! That said...

The secret wage-theft agreements between Apple, Google, Intel, Adobe, Intuit, and Pixar (now owned by Disney) are described in court papers obtained by PandoDaily as “an overarching conspiracy” in violation of the Sherman Antitrust Act and the Clayton Antitrust Act, and at times it reads like something lifted straight out of the robber baron era that produced those laws. Today’s inequality crisis is America’s worst on record since statistics were first recorded a hundred years ago — the only comparison would be to the era of the railroad tycoons in the late 19th century.

That final sentence feels slightly out of place in an article about tech giants. Or at least needs some more context with actual wage sizes.
posted by Going To Maine at 8:05 AM on January 24


This is so sad, just think of all of the cupcakes that have gone uneaten.

That final sentence feels slightly out of place in an article about tech giants. Or at least needs some more context with actual wage sizes.

While it's true that most of the people screwed by this aren't exactly on the edge, any effort to hold down wages should be opposed, and any effort between businesses to illegally collude for the advantage of shareholders at the expense of employees must be punished. Workers need to stand by each other, and being flip about the exploitation of tech workers is not productive behavior.
posted by Pope Guilty at 8:07 AM on January 24 [35 favorites]


Jobs was seduced by the dark side and turned against the techies who made him great.
posted by stbalbach at 8:09 AM on January 24 [3 favorites]


That's weird. I was just reading about this on naked capitalism. One of the super few times labour actually can move on a par with capital and it is conspired against.

Good old Adam Smith:

People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices.
posted by Trochanter at 8:10 AM on January 24 [12 favorites]


"Don't be evil".

Well, now we know that illegally co-operating to cut the wages of your employees isn't evil. I wonder what else "isn't evil"?
posted by pharm at 8:12 AM on January 24 [7 favorites]


Jobs was seduced by the dark side and turned against the techies who made him great.
One of the more telling elements to this lawsuit is the role played by “Star Wars” creator George Lucas, who emerges as the Obi-Wan Kenobi of the wage-theft scheme. It’s almost too perfectly symbolic that Lucas — the symbiosis of Baby Boomer New Age mysticism, Left Coast power, political infantilism, and dreary 19th century labor exploitation — should be responsible for dreaming up the wage theft scheme back in the mid-1980s, when Lucas sold the computer animation division of Lucasfilm, Pixar, to Steve Jobs.

As Pixar went independent in 1986, Lucas explained his philosophy about how competition for computer engineers violated his sense of normalcy — and profit margins. According to court documents:

George Lucas believed that companies should not compete against each other for employees, because ‘[i]t’s not normal industrial competitive situation.’ As George Lucas explained, ‘I always — the rule we had, or the rule that I put down for everybody,’ was that ‘we cannot get into a bidding war with other companies because we don’t have the margins for that sort of thing.’
No, Jobs was just another robber baron, and you were a sucker for thinking different.
posted by ennui.bz at 8:18 AM on January 24 [31 favorites]


Are you saying that them importing tens of thousands of foreign programers on H1b programs may have actually been an attempt to drive down wages? Pshaw, tis to laugh!
posted by The 10th Regiment of Foot at 8:19 AM on January 24 [18 favorites]


Or at least needs some more context with actual wage sizes.

Put it this way, the moment the DoJ started sabre rattling about this issue, Google turned round and gave *all* its engineers the biggest pay rise most of them had ever seen. Prior to that point they'd been able to stave off poaching staff by other tech giants & hold down their wage bills as a result. Who benefitted most from this? Google execs who saw the difference go straight onto the bottom line & therefore be reflected in the price of Google shares.

Sure, tech workers are fairly privileged in the grand scheme of things, but that doesn't make it any the less iniquitous.
posted by pharm at 8:20 AM on January 24 [4 favorites]


Given the hints I've seen in medical, I wonder how many other industries have similar arrangements?
posted by underflow at 8:22 AM on January 24 [4 favorites]


Plaintiffs assert that in a properly functioning and lawfully competitive labor market, each Defendant would compete for employees by soliciting current employees from one or more of the other Defendants.

Plaintiffs allege that cold calling is a key competitive tool that companies use to recruit employees, particularly high tech employees with advanced skills and abilities

Plaintiffs further contend that the use of cold calling among Defendants commonly increases total compensation and mobility for all of Defendants’ employees

The conspiracy consisted of an interconnected web of express bilateral agreements among Defendants to abstain from actively soliciting each other’s employees.


Cold calling. So this is about headhunters.

I have always imagined that there are tacit agreements between organisations - from libraries to universities to hedge funds - to not actively recruit from each other. My wife worked for a long time as a headhunter and it was not uncommon for there to be restrictions on where she could recruit - which made life a bit harder for her - but so long as no one is prevented from pursing advertised job opportunities what's the problem for engineers?

People do, you know, change jobs without being recruited by a headhunter - and when they do they generally get more money since the headhunter's fee (typically 25% of 1st year compensation) doesn't have to be paid.
posted by three blind mice at 8:23 AM on January 24 [1 favorite]


This goes to support one of my theories about Steve Jobs. Yes, he was a pick, but probably not for the reasons you think.

The world would change for the better if everyone's annual income was public knowledge.

How so? We know the the wages of the top brass through SEC filings and it changes nothing.

Many public sector wages are public knowledge and all that does is create grief. "Can you believe she makes 70k a year? I do as much as Bob and he makes more than me! Etc." I don't see the value. A former co-worker once got a raise because he went through my desk drawer and saw one of my pay stubs and realized I made more. Goody for him I suppose, but I think this just goes to show his value. If you can't get a raise without having to do something like this then you have to question your negotiation skills.
posted by cjorgensen at 8:24 AM on January 24 [2 favorites]


While it's true that most of the people screwed by this aren't exactly on the edge, any effort to hold down wages should be opposed, and any effort between businesses to illegally collude for the advantage of shareholders at the expense of employees must be punished. Workers need to stand by each other, and being flip about the exploitation of tech workers is not productive behavior.

Woop! Not trying to be flip here; antitrust violations are serious, serious things. It's just that for an article to throw in a sentence about the inequality of wealth distribution suggests that tech workers are on a very different place on the wage scale than they are. They are labor, and apparently labor that has been getting conspired against by management, but to imply that fixing their wages would help to rectify America's inequality crisis - well, it might, but not quite so much as would other things. Certainly San Francisco's rents won't be getting any better.
posted by Going To Maine at 8:28 AM on January 24 [1 favorite]


Tech companies will bribe their employees all day long with stupid stuff like pool tables and beanbags or free mochaccinos or whatever hipsters like in their offices now, but they'll go to any lengths to ensure the big bucks stay totally within the 2 or 3 founders, who then fight it out in court Winkelvoss-style if things go big.

(They do leave some crumbs on the table for the MBA/CFO guys, because although Jobs et al hate them, they know they need them to get into Wall Street... developers and designers who actually do stuff can forget it.)
posted by colie at 8:28 AM on January 24 [3 favorites]


The world would change for the better if everyone's annual income was public knowledge.

How so?


For one thing, it wouldn't be such a goddamn mystery whether or not you're getting fair pay compared to others in your workplace. And you can kiss off with that "negotiation skills" bullshit. Maybe you love it, but I'm pretty tired of ducking the flying shit here in the chimp cage.
posted by Steely-eyed Missile Man at 8:30 AM on January 24 [57 favorites]


three blind mice: The piece points out that passively recruited candidates are seen as superior to candidates actively pursuing new opportunities, due to the questionable logic that pursuing new opportunities indicates that the candidate is somehow "defective" in some manner.
posted by NoxAeternum at 8:30 AM on January 24 [1 favorite]


three blind mice: Also the companies agreed to inform each other if approached by a competitor's employee and to not make counter offers, which would have the effect of reducing salaries overall & also marking out anyone looking for work elsewhere as being 'disloyal'.
posted by pharm at 8:32 AM on January 24 [7 favorites]


passively recruited candidates are seen as superior to candidates actively pursuing new opportunities, due to the questionable logic that pursuing new opportunities indicates that the candidate is somehow "defective" in some manner

Such tooth-grinding idiocy permeates all parts and levels of the modern day job search and is a big reason I haven't quit my current job out of pure ennui.
posted by Steely-eyed Missile Man at 8:33 AM on January 24 [5 favorites]


the questionable logic that pursuing new opportunities indicates that the candidate is somehow "defective" in some manner.

Downton as fuck.
posted by Pope Guilty at 8:33 AM on January 24 [9 favorites]


the only comparison would be to the era of the railroad tycoons in the late 19th century.

I don't think that is too weird of an analogy, 100/150 years from now what we see as modern and cutting edge will be quaint and part of the background. "Information technology" will eventually settle down become uninteresting in-of-its-self and be replaced by X new thing. Yeah, until the big collapse, we will now always have The Net, just as we still have railroads, but after some point it won't be a dominate as it is now.

With any new technology there are going to be economic parasites that seek to maximize their benefits at the cost of everyone else who works for them. As reprehensible as that is the fundamental fault is not theirs, because, hell that is what they have been taught is the good thing to do. rather it is our continued pathological love affair with individual wealth, "a lot" is not enough, the ideal state is "all". That is what we praise and what we value "The cult of Jobs" was not because he was some great laid back dude who treated his employees well, it was because he ran a very profitable company through propitiatory processes and slick design. Apple products are not crap, but they have flaws that don't really warrant their prices and some cases they are/where not as good as other products, but their design and marketing made them king. And once on that hill you are king until someone else comes along and topples you, which they do by maximizing profits by any means necessary, railroad workers to assembly line circuit board workers John Garrett didn't care about who drove the stakes or ran the trains, Jobs didn't care who made the boards or typed the code. But we value these people.

Fortunately we do have people like Johns Hopkins, and, yeah Bill gates, who seem hell bent on giving away their money for greater good practices. I wish they both had been much more scrupulous in their business dealings wrt their employees at the lowest levels.

We essentially built the nation on slave labor from Africa, then laid the railroads on low paid labor from Asia, we feed ourselves with underpaid workers from central America, we cloth ourselves from low paid workers from many areas of the globe and now are funding the information revolution on low paid labor from Asia again. What many proponents of capitalism seem to overlook is the continuing need for low/unpaid labor to make the system work.

But hey... a new cell phone every 6 months or bust!!!
posted by edgeways at 8:33 AM on January 24 [15 favorites]


They are very close to monopoly power. There is legal collusion and there is illegal collusion. It is basic and elementary that they will do everything legally possible to keep salaries as low as possible. In practice they hire consultants--say Google and McKenzie--and the Google salary calculators are legally prohibited from talking to the Apple salary calculators or the Microsoft salary calculators. The workaround is MIcrosoft hires McKenzie to consult on their compensation package and Apple hires McKenzie to consult on their compensation package and they know everybody's pay grades to the dollar all legal. That is how it happens (this has happened to me) you look at salary survey results from your professional society and wo! look at that! My salary is smack dabba doo in the middle of the chart. That is how it happens (this has happened to me) that you get an e-mail forwarded to you from your boss where he doesn't delete the fact that they know that your salary is 99.70% of the chart number or 100.20% of the chart number.
posted by bukvich at 8:42 AM on January 24 [3 favorites]


Yeah on negotiating skills... I'm not paid to be a negotiator. If you have a job that requires me to produce for you, pay me what my value is to you. Pay the guy next to the same unless he or she can't produce enough, in which case fire them. If I exceptionally produce more than the average Joe, bonus my ass up. Forcing employers to disclose wages is a bit much but can we at least block them from firing people who discuss wages?
posted by lordaych at 8:42 AM on January 24 [14 favorites]


Forcing employers to disclose wages is a bit much

Why?
posted by Steely-eyed Missile Man at 8:52 AM on January 24 [1 favorite]


If you have a job that requires me to produce for you, pay me what my value is to you.

They are. Your value to your employer is nothing, which is what they would pay you if they could. Since they can't, they will pay as close to that as they can. The employer isn't looking to give you money, it's looking to extract work from you.

If you think otherwise, you are deluding yourself. If your employer can have you do the same work for less pay, why would they provide even a dollar more?
posted by Sangermaine at 8:52 AM on January 24 [18 favorites]


If your employer can have you do the same work for less pay, why would they provide even a dollar more?

Even a distant possibility of being dragged to the street and hung on a lamp post by an angry mob works fine as a motivator in the long term.
posted by hat_eater at 8:58 AM on January 24 [11 favorites]


the questionable logic that pursuing new opportunities indicates that the candidate is somehow "defective" in some manner.

I personally wouldn't say that I've seen an attitude that seeking candidates are "defective", but rather that of the non-seeking candidates in a given industry, there's a subset of potential candidates that aren't seeking because they're high-performing and being rewarded for it sufficiently to keep those people from seeking. If you don't go looking for those people, then you're limited to the good people who choose to seek. There are absolutely good people who end up seeking (out of necessity, frustration, boredom, what-have-you) and bad people who aren't seeking, so you're still going to have to do the same amount of weeding.

Of course, my experience is anecdotal.

Peeps at a company that I'm surprised isn't named in the lawsuit was bitching about wages being weirdly flat starting about 2004 or so.

Huh. My experience (I'm full of anecdotes today!) was the opposite, where I was at a non-valley company with weirdly flat wages from 2000 through mid-2005, and after moving to a silicon valley company in 2005 my wages were no longer flat. Then again, the company isn't named in the lawsuit and calls from headhunters are a regular fact of life...
posted by davejay at 9:00 AM on January 24


I don't see the value. A former co-worker once got a raise because he went through my desk drawer and saw one of my pay stubs and realized I made more. Goody for him I suppose, but I think this just goes to show his value. If you can't get a raise without having to do something like this then you have to question your negotiation skills.

You're mad because another employee found out he was underpaid and demanded fair compensation? Seriously?

Do you just completely not care about the fact that keeping employee wages private is a great way to make sure marginalized groups who are generally undervalued and paid low wages because of prejudice? Or have you just consumed so much of the boss' kool-aid that you don't actually care about your fellow workers anymore?
posted by NoraReed at 9:02 AM on January 24 [28 favorites]


"I didn't get rich by writing people checks."

- Bill Gates, according to The Simpsons.
posted by benito.strauss at 9:02 AM on January 24 [3 favorites]


> went through my desk drawer and saw one of my pay stubs and realized I made more. Goody for him I suppose, but I think this just goes to show his value. If you can't get a raise without having to do something like this then you have to question your negotiation skills.

What if someone's skills they use to do their job are great, but their negotiation skills are poor? Do they deserve to be paid less?

> If your employer can have you do the same work for less pay, why would they provide even a dollar more?

Probably a good thing for an employee to keep in mind when considering whether or not to ask for more money (do ask!), but not a great strategy for an employer. At least consider "same work for less pay" as possibly not being true. A worker who doesn't have to worry about making a Silicon Valley mortgage payment is a worker who has more time/energy to think about solving the employer's problems.
posted by morganw at 9:06 AM on January 24 [6 favorites]


If your employer can have you do the same work for less pay, why would they provide even a dollar more?

Indeed. That's ultimately the point of a salary renegotiation: they're trying to avoid increasing their costs, and you're trying to get as much as you can, so you're doing a dance to find a number that is not quite as much money as it would cost for them to go through the losing-and-replacing-you process, knowing that if your demand crosses that line and you don't accept their counter-offer you're going to be replaced. As you become specialized and/or experienced, you become more difficult -- so more expensive -- to replace (and the lack of productivity during the search becomes more expensive as well), which is why specialists and experienced people end up being paid more money.

Incidentally, that's a good recurring question to ask yourself as you move through your career path: "how can I make myself legitimately more difficult to replace?"
posted by davejay at 9:06 AM on January 24


they're trying to avoid increasing their costs, and you're trying to get as much as you can, so you're doing a dance

I believe this is what used to be called the Class Struggle.

specialists and experienced people end up being paid more money.


For a while. When these people hit 40 or so, it's often cheaper to fire them and hire 3 or 4 much younger people to do the same job. People fresh out of college don't get paid any money at all now.
posted by colie at 9:11 AM on January 24 [12 favorites]


I don't mind disclosing wages at interview, providing the other people in the room do the same.

And for anyone who thinks that this is about cold calling, so it doesn't really matter: the execs thought it mattered, which is why they went to such lengths to keep it secret. The court thinks it matters enough to go to trial. And, if this is proved, I'm sure we'll see it matters a great deal.

One good thing about devops, which I've never seen mentioned, is that if it works as advertised then it cuts out slack in projects. Which means it's much harder for companies to disguise worker action. Remember that?
posted by Devonian at 9:12 AM on January 24


but not a great strategy for an employer. At least consider "same work for less pay" as possibly not being true. A worker who doesn't have to worry about making a Silicon Valley mortgage payment is a worker who has more time/energy to think about solving the employer's problems.

And yet here we have a conspiracy by the world's most prominent tech companies to keep down employee wages.

The fools! If only someone had told them that they were creating less energetic workers with their scheme they would have gladly paid out more money!
posted by Sangermaine at 9:14 AM on January 24 [2 favorites]


I believe this is what used to be called the Class Struggle.

Well, I think it applies even if you're someone's peer and you're attempting to hire someone for a service, right? Let's say you're a gardener and you clear $25,000 a year, and you need to hire a plumber. They want as much as possible, you want to pay as little as possible, and so they ask for as much money as they think you will pay vs going through the trouble to have a different plumber out for an estimate that might accept less money. Yet you're still a gardener, they're still a plumber, and they might even be a plumber who makes more than you yearly. So not really limited to class struggle; just basic supply and demand economics.
posted by davejay at 9:16 AM on January 24


Incidentally, that's a good recurring question to ask yourself as you move through your career path: "how can I make myself legitimately more difficult to replace?"

Hmm. I'll be right back, I have to go install BIOS boot time passwords on the machines at Dominos.

(NOTE I'M NOT ACTUALLY DOING THIS IT IS A JOKE DON'T SUE ME)
posted by JHarris at 9:20 AM on January 24 [1 favorite]



I have always imagined that there are tacit agreements between organisations - from libraries to universities to hedge funds - to not actively recruit from each other. My wife worked for a long time as a headhunter and it was not uncommon for there to be restrictions on where she could recruit - which made life a bit harder for her - but so long as no one is prevented from pursing advertised job opportunities what's the problem for engineers?


3 years ago there were job postings that flatly said they were only taking applications from people currently employed. That's how bad it was getting.
posted by ocschwar at 9:25 AM on January 24 [1 favorite]


Well, I think it applies even if you're someone's peer and you're attempting to hire someone for a service, right? Let's say you're a gardener and you clear $25,000 a year, and you need to hire a plumber. They want as much as possible, you want to pay as little as possible, and so they ask for as much money as they think you will pay

no, that's just market economics. The point of the phrase "class struggle" is that there is a categorical difference between people in an economy depending upon their relationship with capital. A capitalist accumulates capital by systematically paying people less than their work earns and the ability to exploit employ people to do useful/profitable tasks depends upon access to previously accumulated capital. Workers are not stupid, therefore in order to accumulate capital, capitalists have to employ various strategies to pay people less than they are worth. These strategies taken as a whole constitute "class warfare."

(Note that class has nothing to do with who you are, your identity, your culture but simply your relationship to capital)
posted by ennui.bz at 9:43 AM on January 24 [10 favorites]


When you hire a plumber, in a sense you're playing the role of a boss in that negotiation - but the plumber will bring their own tools and the job depends entirely on his or her own knowledge and skills, rather than depending on being supplied by you with access to the means of production. This kind of casual artisan labour is not really part of the production process. The plumber isn't really a proletarian, which is also true of a developer in a software company, which is perhaps why it stings them a bit more when stories come out like this one to reveal capital's unstoppable desire to proletarianise everyone in due course.
posted by colie at 9:50 AM on January 24 [1 favorite]


There are strong efforts to eliminate IT workers as a middle class profession. Serious, if you're into systems or network administration at a big shop, your ass is grass in 5 years or less - DevOps and SDN will run you right out of town. Even at a small shop, the pressures to move IT to virtualized internet hosts (aka "the cloud") are nearly insurmountable, even for key infrastructure. First, they tried with H1B's, then they tried with outsourcing. Now, we're up against a double whammy of outright collusion and conspiracy, combined with natural progression of IT to increase productivity.

If you're not an experienced developer with Python and Ruby chops, your only option for employment in IT will be helpdesk work, which pays marginally better than non-unionized janitorial services positions. Maybe worse, as there will be a lot of people who spent a lot of time learning how to build systems from the command line or GUI who will be looking for a gig. If you do retrain, on your own time and on your own dime, your skillset will have a price fixed not on its worth or demand, but by cartel bullshit.
posted by Slap*Happy at 9:55 AM on January 24 [6 favorites]


The plumber isn't really a proletarian, which is also true of a developer in a software company, which is perhaps why it stings them a bit more when stories come out like this one to reveal capital's unstoppable desire to proletarianise everyone in due course.

a proletarian is someone whose labor has become entirely replaceable from any source i.e. a commodity.

this story isn't about proletarianization of the developer side of SV, but just the sausage of how capitalism runs. There's nothing truly atypical about this sort of behavior for any industry, it's just that these companies are so profitable that the numbers are huge. Running a small business is about nickel and dime-ing your workers, running a large business means those nickels and dimes add up.
posted by ennui.bz at 9:58 AM on January 24 [1 favorite]


If you're not an experienced developer with Python and Ruby chops, your only option for employment in IT will be helpdesk work, which pays marginally better than non-unionized janitorial services positions.

You'd be surprised how many developers haven't the foggiest idea how to keep a server farm going--even vms. There's a lot more to IT than just programming.
posted by empath at 10:08 AM on January 24 [2 favorites]


Stupid Simple Things SF Techies Could Do To Stop Being Hated
posted by homunculus at 10:08 AM on January 24


That's the thing about people attacking the Google buses, it's like janitors attacking baristas... I prolly have the hookup on a Google job if I wanted, but I am very hesitant on account of I like my job where it's just capitalism and not regressing towards feudalism. Might try it for a year or two out in NY cause I guess you can pretty much live in both NYC/SF - I also hear at this point they're just hiring people for boreass scutwork in order to starve competitors of skilled developers, I could see doing low-stress for a while.

I have also requested early notice when the corporate orders start coming directly from "Google" itself.
posted by save alive nothing that breatheth at 10:13 AM on January 24


While it's clear that Lucas's memo is directly tied to dollars, I think you could make a case that for Apple and Google, there were other significant issues at stake, namely stability and intellectual property.

Losing a key member of a development team can set a project back by months, and when you're doing cutting edge stuff, what that employee knows in terms of what is patentable or has been patented can have a big effect on your bottom line. More so, I might guess, than paying a few thousand engineers an extra $20K.

Not to say that Apple and Google don't look at cost per employee, but I'm somewhat suspicious that supressing that specific cost was the only motive.
posted by CheeseDigestsAll at 10:19 AM on January 24 [1 favorite]


That final sentence feels slightly out of place in an article about tech giants. Or at least needs some more context with actual wage sizes.

I don't know. For some time now, in my mind this current era is clearly "The Second Guilded Age", and going by descriptions of the first, tech might not be as different from rail as you think.

Unfortunately I'm afraid I can't tell you when "the 2nd Guided Age" ends and "The Pre-Apocalypse" begins. Future shaman-historians are still arguing about that.
posted by anonymisc at 10:36 AM on January 24 [1 favorite]


You'd be surprised how many developers haven't the foggiest idea how to keep a server farm going--even vms. There's a lot more to IT than just programming.

Well, the issue is that it runs the other way - and, unless you can run your server farm and the network it runs on programmatically, you're going to be out a job. I am coming up to snuff on Ansible and various flavors of OpenFlow controllers - which is a start - but I also need to learn a lot of the art of software development, which is a deep and broad field, and tough to change gears into. I'm not going to be an admin who writes programs to automate the server farm, that job is going away. I'm going to be a programmer who writes software that will define and deploy systems.

It's going to be easier to teach a developer the idiom of system design and deployment than to teach an admin design patterns, software architecture and the nuts-and-bolts of development (how to use a debugger and to manage a codebase, etc.)

In short, I will be starting out as a junior programmer with no proven talent at it, and hope to christ my experience with the underlying tech will give me a leg up over other junior programmers half my age. I still have a nice gig as a firewall guy - but I can't see my position being there in another five to ten years, and I can see a lot of competition for what few non-DevOps IT jobs are out there.
posted by Slap*Happy at 10:59 AM on January 24 [1 favorite]


Has anyone seen any good reporting on this case other than Pando? This article is great but that website is hopelessly tarnished as a journalistic outlet, I'd love to get this story from somewhere reputable.
posted by Nelson at 11:05 AM on January 24 [1 favorite]


I worked at Google in the era covered by this lawsuit. As an engineer, I didn't do any recruiting and have no personal knowledge of any of this alleged collusion.

Like CheeseDigestsAll I'm curious to learn more about motive. Ames' article strongly casts this in terms of a desire to keep wages low, but as far as I saw the fine article doesn't have any direct evidence for it other than the one old George Lucas quote. I don't dispute his argument that hiring collusion would have the effect of lowering salaries but I'm not sure that is the only intent. Deliberate poaching of engineers is hugely disruptive to the target business, it deprives the other business of the engineer. It also causes a lot of distraction for management for each hiring event. And the intellectual property issues are a mess. Basically there'd be a lot of harm to Apple/Google to have an all-out hiring war and some reasons to agree not to try, not just keeping wages low. (I don't mean to defend any illegal collusion, just adding some nuance to the possible reasons why.)

Some other bits of color to add to the story.. It's accepted wisdom that part of why Silicon Valley is successful is because of the cross-pollination of everyone changing jobs every few years, so this story is interesting in how it goes against that grain. Also Google was aggressively hiring people from other tech companies in this era, places like Microsoft and the dying Sun, so it's interesting that Apple gets special treatment. And all of this takes place in a timeframe where Google was significantly raising cash wages in the same era, a post-IPO change.

Also interesting to read about Bill Campbell's personal involvement. Between this court case and Nick Bilton's casting him as a villain in Hatching Twitter, it's been a bad few months for Coach's public profile.
posted by Nelson at 11:15 AM on January 24 [2 favorites]


Silicon Valley's efforts on this front extend to helping fuel the false notion of a STEM fields shortage (see here, here, or here and here) which is impacting American higher education in some very bad ways.
posted by LooseFilter at 11:41 AM on January 24 [4 favorites]


stbalbach: "Jobs was seduced by the dark side and turned against the techies who made him great."

Same as it ever was.
posted by Mitheral at 11:51 AM on January 24 [1 favorite]


Why do stagnant middle-class wages hurt the economy? Because the middle-class folks whose wages are stagnant are the global economy's biggest spenders. And when they don't have money to spend, their lack of spending hurts not just them but all the companies that depend on them for revenue.
posted by gucci mane at 11:53 AM on January 24 [3 favorites]


cjorgensen: "How so? We know the the wages of the top brass through SEC filings and it changes nothing."

There's a general information assymmetry in wage negotiations. The board of directors tends to know what they paid the last CEO, and if considering internal promotions, they know what the applicant makes. In contrast, the applicant far less information. So if a policy change comes along and publishes executive salaries, you'd expect there to be a negotiation improvement for the less informed party, and a resulting wage increase.

cjorgensen: ""Can you believe she makes 70k a year? I do as much as Bob and he makes more than me! Etc." I don't see the value. A former co-worker once got a raise because he went through my desk drawer and saw one of my pay stubs and realized I made more."

So we agree then, that public disclosure of salaries would lead to raise in negotiations, but apparently disagree that raising wages for line staff would make the world a better place?
posted by pwnguin at 11:54 AM on January 24 [3 favorites]


Forcing employers to disclose wages is a bit much
Why?

You know I'm not actually opposed to it, I should've qualified that with "maybe forcing them to disclose wages is a bit much" because I haven't thought through any negative factors. Honestly without thinking anything through, I'd be in favor of forcing employers to disclose wages, and for job postings to require a reasonable salary range for the actual work they expect to be done right up front so we don't waste our time applying for a job with an unknown range that happens to be "$30-90K -- we'll make you work hard and if you're not as skilled as the $90K worker, you'll put in more unpaid salaried hours getting up to speed and we'll extract more value out of you by paying you less and bringing you up in the company...but ultimately we want you to produce the same thing was the $90K guy, LOL!"
posted by lordaych at 12:07 PM on January 24


I find the whole "yeah if you can't fight tooth and nail to prove you deserve more money then tough shit" tack nauseating, because we've turned it all into an information asymmetry game that wastes people's time and ensures that the most disadvantaged people on the asymmetry are constantly at war with each other. I think it's in a company's interest to pay enough to attract good people, and to want to keep them around. It depends on the job role, but that's elitist bullshit in my opinion, which is why we need a reasonable minimum wage. Too many companies are interested in just grinding through people like fucking sausage and spitting them out.

Sure there are many very unique jobs where you can't compare people side-by-side very easily or you have no counterpart in the organization, like my job where I'm the only person in the company and possibly the state doing exactly what it is I do. So I did have to find people across the country to get some sort of idea of what I should make, and found exactly one person who could describe the same job description, and he had to essentially leave his employer completely screwed in order to get the salary he required to be a happy and productive employee.

Often the wage negotiation deep into a job amounts to proving that others are actually dead weight and you're picking up the slack; if the company hired enough people to perform the job it would be less stressful and they ultimately give the big raises to the people they know they'd be screwed to let go, rather than fostering an environment that doesn't keep dead weight around, doesn't make people feel like they're idiots for staying around, and doesn't value "Cinderella" type people so much that they end up getting tons of responsibilities and assignments without commensurate pay or any idea of what their value is to the company. That's the worst part, when you realize you're hot shit and that people have been keeping it from you forever.
posted by lordaych at 12:14 PM on January 24 [1 favorite]


I find the whole "yeah if you can't fight tooth and nail to prove you deserve more money then tough shit" tack nauseating, because we've turned it all into an information asymmetry game that wastes people's time and ensures that the most disadvantaged people on the asymmetry are constantly at war with each other

Forgot to add, they're constantly at war with each other and when they unionize they get fucked over and attacked, and meanwhile, as we see with all privilege and advantage, the capitalists holding the actual capital and the hiring managers holding the hiring power have all of the power and the information they need to remain enriched, and they fucking game every piece of the system from top to bottom with immense resources, while we're supposed to go around begging for information that ultimately proves we deserve what we were pretty sure we were worth all along.
posted by lordaych at 12:16 PM on January 24 [3 favorites]


Apple and Google, doing their part to keep down gentrification in SF.
posted by StrangerInAStrainedLand at 12:18 PM on January 24 [2 favorites]


Silicon Valley's efforts on this front extend to helping fuel the false notion of a STEM fields shortage (see here, here, or here and here) which is impacting American higher education in some very bad ways.

I can't believe people still buy into that notion. Jobs are definitely rapidly disappearing in the 'S' field I work in (biology). I work with a lot of pharma/biotech clients across the U.S., and it seems like almost all of them are constantly laying off workers, going through "re-organizations" that always result in less employees. Also, jobs that used to employ folks with B.Sc. degrees now require Ph.D.'s for even menial benchwork. The pay hasn't changed, only the requirements have.
posted by Thoughtcrime at 12:21 PM on January 24 [4 favorites]


Apple and Google, doing their part to keep down gentrification in SF.

I know, right, first they're paying too much, now they're not supposed to try to pay less... Billionaire world problems.
posted by save alive nothing that breatheth at 12:25 PM on January 24


I can't believe people still buy into that notion.

You have no idea. Entire systems of universities are making changes to respond to this false shortage.
posted by LooseFilter at 12:47 PM on January 24 [1 favorite]


You have no idea. Entire systems of universities are making changes to respond to this false shortage.

Yes, and in return they are reaping the full tuition costs paid by the cohort of foreign students who will then slide seamlessly into the H1b stream.
posted by The 10th Regiment of Foot at 12:50 PM on January 24


Think how this conspiracy feeds into the claimed "shortage" of qualified engineers (and STEM workers, in general) - a claim made to goose up the H1-B quota numbers. I have seen both of these games played, first hand, in Silicon Valley.

I'm delighted to see this lawsuit naming names - Steve Jobs, Eric Schmidt, etc. etc - the "precious" scions of Silicon Valley culture tries to paint itself as a culture of daring entrepreneurs and uncanny risk takers that dare to dream their dreams and rise to the top. It's always been a bunch of baloney, and it still is.

There has been an underground impetus to organize tech labor, for years. It has always fizzled because tech companies perpetuate the myth that there is a free labor market that will best serve tech workers.

Ideally, if this lawsuit is won, I would like to see the perpetrators (all the way to the top) do some prison time, in addition to having to pay substantial fines. I doubt this will happen - tech executives carry a lot of leverage in Washington...our Plutocracy lives on.
posted by Vibrissae at 1:01 PM on January 24 [5 favorites]


who will then slide seamlessly into the H1b stream

For substantially lower wages, of course. Why outsource when you can bring outsourcing to you?
posted by LooseFilter at 1:51 PM on January 24


There has been an underground impetus to organize tech labor, for years. It has always fizzled because tech companies perpetuate the myth that there is a free labor market that will best serve tech workers.

Actually I think tech workers are their own worst enemy here - it fizzles because so many tech workers have libertarian-esque outright hostility to unions, and I don't think that comes from the tech companies. I think there is also a kind of a class thing going on too - an idea that unions are for blue collar steelworkers, and cubical professionals are better-than.
posted by anonymisc at 2:39 PM on January 24 [9 favorites]


so many tech workers have libertarian-esque outright hostility to unions,

I think you can see an example of that kind of thinking back up the thread- the idea that one's Mad Negotiating Skillz would be less of an advantage if everyone even had symmetrical information, much less tech-dude solidarity.

Speaking as a tech guy w/o negotiating skillz, I've been baffled by this crap for ages, but I guess it makes sense in a fuck-you-got-mine kinda way. Oh wait, you already said 'libertarian,' no need for me to be redundant.
posted by hap_hazard at 2:53 PM on January 24 [7 favorites]


No, Jobs was just another robber baron, and you were a sucker for thinking different.

Pitch forks etc.. *yawn*
posted by stbalbach at 2:56 PM on January 24


The anti-union sentiment is definitely prevalent on all sides [warning: Paul Graham is such a smug fuck that it will make you explode with rage] in the tech industry.
posted by invitapriore at 2:58 PM on January 24 [4 favorites]


The world would change for the better if everyone's annual income was public knowledge.
Moving from the private to public sector, this was one of the biggest changes I noticed - everyone knows what everyone else is earning getting paid, so the whole scene guessing what others get and comparing it with what you get goes away, as does the idea that a person with better negotiation skills and/or who is better at sucking up to the boss gets paid more for the same work. It doesn't eliminate the bitchiness entirely - it moves it to 'how the fuck is that position classified at that level, when it has half the responsibility of my position' but it does make it a lot less personal.

I think it would be awesome if earnings were made public as in the Norway example. It would eliminate a lot of nonsense about how much certain people get paid and, at the same time, put into sharp relief how little others get. It had the potential to be a best equaliser, I think.
posted by dg at 3:01 PM on January 24 [1 favorite]


Silicon Valley culture tries to paint itself as a culture of daring entrepreneurs and uncanny risk takers that dare to dream their dreams and rise to the top. It's always been a bunch of baloney, and it still is

A bunch of baloney that pays very well. No one mentioned stock options which is where most techies make real money. As always, if you want to get rich own stock in the company, or start your own. It is called "wage slave" for a reason. I'd work at Apple for $1/hr if my stock options were decent.
posted by stbalbach at 3:04 PM on January 24 [2 favorites]


Ideally, if this lawsuit is won, I would like to see the perpetrators (all the way to the top) do some prison time, in addition to having to pay substantial fines.

What humor! If this had been done by an average joe on the street, we'd hang him. But corporations are people too! People with all the perks and none of the responsibility to society.
posted by BlueHorse at 6:42 PM on January 24


I'd work at Apple for $1/hr if my stock options were decent.

Really? How would you afford to exercise those options and actual purchase the shares?
posted by MikeKD at 7:37 PM on January 24 [2 favorites]


No one mentioned stock options which is where most techies make real money.

In fact, most techies who take stock options don't make a dime on those options (and many lose money on their options. How is this? Because most start ups die, making the options worthless. And, if you start with options and decide to leave before a company goes belly-up (which most do) you are given the "opportunity" to exercise an option to pay for and "hold" your options. I have - and know others who have - done this, only to see the company one has left go belly up, with all lost. This doesn't even begin to factor in the fact that the opportunity cost of taking options instead of salary most often leads nowhere (again, due to start up failure). So, all those insane hours you worked for, for less money than you would have otherwise, is all you get - no chance to exercise options if the company fails.

Don't even get me started on the new trend to pack everyone into one room - sharing desks - to save money. (Good research shows that these shared desk, so-called "community" environments are counterproductive re: efficiency; it's just another way to start up cheap - yet another VC "cost economy" that serves - guess who? - the VC.
posted by Vibrissae at 8:06 PM on January 24 [6 favorites]


Really? How would you afford to exercise those options and actual purchase the shares?

Brokers will let you sell some shares from your options with the cost being deducted from the sale price — sort of like a no-interest loan for the time between exercising the option and selling them. (This is just a technical detail that doesn't answer any of the other objections, like those raised by Vibrissae.)
posted by benito.strauss at 8:33 PM on January 24 [1 favorite]


so many tech workers have libertarian-esque outright hostility to unions,

Man, if I owned a tech firm I'd leave Von Mises and Rothbard and Friedman and Rand stuff out everywhere, bring in AEI and Cato Institute speakers, the works. What could be better than fostering an ideology in your employees where they demand that you strip them of all protections and act as mercenary as possible, and even denounce any and all regulations that might hamper me?
posted by Sangermaine at 9:09 PM on January 24 [5 favorites]


In fact, most techies who take stock options don't make a dime on those options

Yeah no one at Apple makes a dime on their stock options.
posted by stbalbach at 9:29 AM on January 25


Most techies don't work for Apple.
posted by pracowity at 1:17 PM on January 25 [1 favorite]


Predictable strawman. The techies we are discussing work at Apple or similar large public companies in Silicon Valley where options are standard and pay out.
posted by stbalbach at 7:36 PM on January 25


Collusion amongst the big players to depress wages depresses wages at smaller shops too where options may not be a sure winner.
posted by Mitheral at 8:43 PM on January 25 [4 favorites]


Possibly. Depends on the scale of the wage suppression compared to the scale of the tech industry. I know people who bounce back and forth between companies getting raises each time every few years, so that may be what they are trying to stop, it's a game both sides play.
posted by stbalbach at 11:06 PM on January 25


And if that's as common a way to increase one's wages in the tech industry as I've been led to believe, then yeah, trying to stop that is a way of suppressing wages.
posted by Pope Guilty at 11:30 PM on January 25


so even the guys who, compared with me, are incredibly rich, are being screwed over by their bosses - it's depressing when even the people you think are young and free and healthy and wealthy and able to exercise choice in their lives are in a cage too, albeit a much bigger one
posted by maiamaia at 7:50 AM on January 26


I know people who bounce back and forth between companies getting raises each time every few years, so that may be what they are trying to stop, it's a game both sides play.

That seems like a false equivalency to me. Going to whoever will pay you the most doesn't seem to be a game. Colluding to suppress salaries definitely is and it's against the rules.
posted by Mental Wimp at 10:39 AM on January 27 [2 favorites]


Yeah, "both sides do it" is the most tired justification there is.
posted by Steely-eyed Missile Man at 10:41 AM on January 27 [1 favorite]


No, Eric Schmidt, You Don't Deserve 100 Million More Dollars
posted by homunculus at 5:04 PM on February 5


I wanted to work at Apple really bad, and now not so much. Walking out on my dream job.
posted by homunculus at 12:37 AM on February 13 [1 favorite]


PS. I’m currently looking for a new design job. Please contact me if you have one that’s cool.

Hi, I just walked out of a prestigious job with no notice and called my boss an asshole publicly. Please hire me.
posted by empath at 12:50 AM on February 13


That is indeed what the guy did, and good on him.
posted by colie at 3:33 AM on February 13 [1 favorite]


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