Judge Rejects $324.5 Million Settlement For Tech Workers, Argues For More

An anonymous reader writes with this news from Reuters: A U.S. district judge on Friday ruled that the $324.5 million settlement negotiated by Apple, Google, Intel, and Adobe with the tech workers who brought an antitrust lawsuit against them was too low. The judge cited the settlement amount of a similar lawsuit brought against Disney and Intuit last year which resulted in plaintiffs obtaining proportionally more for lost wages. And yet, according to the judge, the current plaintiffs have "much more leverage". She cited evidence clearly showing Apple's Steve Jobs strong-arming the other companies in the suit into agreeing to a no-employee-poaching agreement, and in one instance, of Google failing to rope in Facebook into a similar agreement which resulted in a 10% increase of all Google employee salaries. In other words, clear evidence that the no-poaching agreement effectively suppressed the salaries of these companies' tech workers. Another hearing is scheduled for September 10.

Comments

In other words...

[thieh]

New talents will be nigh impossible to develop from scratch because it's the same guys who shifts between the big firms. Is it really so hard to develop talent who isn't currently working for those firms?

Re:In other words...

[nolife]

Devolving talent and skills requires time. There is always new people coming in but they do not come in immediately to the higher level positions. They start lower and possibly work their way up. If your top performers are leaving soon after they reach that "top performer" level, you will have less top performers. So, you recognize their benefit to your company and provide better benefits to try to keep keep them happy or you illegally collude with your competition and peers to not offer benefits greater then you or flat out refuse to hire them away from each other at any cost. These companies chose the later method.

And yet

[Spy Handler]

how could these companies say with a straight face that they only want more H1B visa employees due to lack worker shortage and not because they're trying to find cheaper labor?

Re:And yet

[Anonymous Coward]

How horrible! Workers should be completely disposable, just like any common tool or machinery. Only the owners are truly indispensable.

Re:And yet

[roman_mir]

It's not about who is dispensable or not, companies do not exist to hire people, they exist to make products / provide services that allow the owners to make money, that's the purpose of a company. Hiring employees becomes necessary when there is more work that can be done, where the cost of hired labour is lower than the value produced by that labour. If you make labour cost too high, less of it will be bought, because the value produced by that labour may not be enough to cover the cost and to make some profit, and the whole point of business is to generate profit, otherwise it's not a business but a hobby. Hobbies have their place in life too, nothing wrong with hobbies, but hobbies can lose money, while businesses can only survive if they make money. Making money is the point and labour is just like any other tool or machinery, that's exactly what happens. Labour cost competes with capital cost, make labour cost too high and capital may win, which means automating or outsourcing the labour (capital wins in this case in terms of setting up the infrastructure necessary to outsource labour).

If everybody ran their own company and nobody wanted to work for anybody else, then you'd have the exact situation where everybody was an owner and there would be no employees, but in some situation the cost of labour would be too high, and so the price offered for labour would go up. Then some people who are making less money running their own businesses than what could be offered to them to work for other employees could shut down their businesses and go work for someone else.

The problem in USA is not that Google and Apple had agreements not to hire from each other, it's that there are so few employers at all, and that's a problem of business costs being too high thanks to government rules, taxes, regulations, litigation costs, inflation etc.

Re:And yet

[vux984]

The solution to H1B visa employees is to simply have combination of a wage requirement plus an annual tariff on H1B visa employees such that the total cost of the H1B visa employee is higher than the median employee costs.

If the companies still want H1B visa employees then there is a genuine shortage, and they'll pay what it takes to get employees.

If suddenly they don't want piles H1B visas and start hiring locally, well.. that tells us there wasn't really a shortage.

Given H1B employees tend to get paid less though, I expect that's the main reason they are desirable.

Re:And yet

[Anonymous Coward]

> If you make labour cost too high, less of it will be bought

This is meaningless and really the reason I'm modding you down. You have tried to equate rising wages to labor cost to anti-business. The rest of the post is either statement of facts (redundant as it does not lend to an argument) or statements of opinion about orthogonal concerns (offtopic). Specifically, your only point, that I can see, was to characterize a business running at a loss as a hobby and then what that means to you. Let's nevermind the horrendous losses Amazon suffered around the millenium, it was only a hobby.

Re:And yet

[Johnny Mnemonic]

"free market principles," collusion between competitors destroys the free market. The same is true on the other side too, iow unions. I suspect you don't support unions, right? suppressing worker's wages not through lack of demand or value, but by constraining supply through secret conspiracy, is not a free market. It's just the same as the same companies conspiring to raise prices on their goods and refuse to compete with each other, which prevents the Invisible Hand of the market from working correctly.

Re:And yet

[darkseid]

Are you posting because the pages to your copy of "Atlas Shrugged" are stuck together again?

Re:And yet

[Dutch Gun]

I'm pretty sure the reason you were modded as flamebait is that you appear to be rather sympathetic to two multi-billion dollar corporations that were illegally conspiring to suppress the true market value of the wages of their highly skilled employees. You also touched a particularly sensitive nerve by justifying the use of outsourcing, something bound to be pretty unpopular on this site, so it's not too surprising. I do agree with some of the points you made. But it's the last paragraph that's the killer.

The problem in USA is not that Google and Apple had agreements not to hire from each other...

It doesn't matter what excuse you provide after that. That's the topic at hand, and that's what their punishment is all about. I agree that there are too many government rules, taxes, regulations, litigation costs. But you can't use that to justify what these companies did. It was wrong, plain and simple, as well as being illegal. These are not companies that are desperately trying to stay profitable - one could understand if not condone the actions if they were unable to turn a profit due to skyrocketing labor costs. This is just trying to maximize profits at the expense of their workers - nothing more than that.

Despite my personal disagreement with your position, your point was stated clearly, without inflammatory language or personal attacks. Unfortunately, -1 Flamebait all too often means "I vehemently disagree with you and wish to show my displeasure / suppress your viewpoint". It's petty and narrow-minded to mod someone down just because you disagree with someone. Goodness knows we can't actually have people disagreeing about something more substantial than one's personal choice of code editor.

Re:And yet

[Belial6]

Even better is to require the company to hire a local worker at equal wages who produce nothing. The premise of H1B is that there are no local workers with the correct skill set to do the job. let the company hire all the H1Bs that they want. Just make them pay full wages to a local worker to train them to do the job. Given that this will double the pay that the companies claim is the prevailing wage, even if they are driving wages down, it will still cost them significantly more than just a local worker. This will give them incentive to actually train the local so that an H1B is not necessary. This would give businesses the flexibility to get workers when needed, while protecting the future by improving the skills of locals.

Re:And yet

[phorm]

Even at wage/cost parity, it still might not cover the benefit of having an employee who is beholden to the company and less likely to report unpaid overtime and/or poor working conditions etc.

Look at the situation in Canada with TFW's. Approximately the same pay, but employees were benefiting from the ability to shaft employees while holding the "we'll pull your work visa if you don't tow the line" card.

Re:And yet

[JanneM]

Given the premises of this thread (the costs and salaries of work immigration need to be controlled by the state), here a half-serious suggestion:

Have work immigrants be employed by your federal govermnent, not by the company they work for. The immigrant reports their working hours and conditions to the government, and they get their salary paid out from there. The government dispatches the worker to the company, and get the salary and other costs paid back from them.

The great benefit is that the worker is no longer there at the mercy of the company, and has no incentive to accept bad conditions or missing pay checks from them. And in any labour dispute they have the backing of a major legal and administrative organization. The government gets a clear view of exactly who the work immigrants are and what they do for their employers. The companies are relieved of some of the responsibility for these workers. Everybody has a common, single point of focus where they can turn in case of problems.

Re:And yet

[AmiMoJo]

Unions are necessary because of the huge imbalance of power between the employer and the employee. The company can replace most of its staff easily and at minimal cost. Most employees can't afford to be out of work for long.

Re:And yet

[Dutch Gun]

As a society, we make value judgments all the time about what sort of behaviors should be allowed or prohibited when engaging in commerce. Most of them are based on nothing more than a simple application of the golden rule, or other basic tenants of morality that most societies can agree upon: Don't lie. Don't steal. Don't cheat. Etc, etc.

I wish you luck in trying to argue that, from a moral perspective, two corporations should have the right to secretly negotiate in order to suppress their employee salaries and maximize their profits. Don't lie. Don't cheat. Seems pretty straightforward to me.

Re:And yet

[MrKaos]

I am not against unions that do not derive their power from government, so if you want to start your own union, you should be able to, however as an employer, I should not be compelled to work with a union, so I should be able to fire all people in the union, it's my discretion. Agreement between two companies not to hire employees from each other is suboptimal, but nowhere near the scale of damage that government causes with rules and regulations and taxation and inflation. As I said, the problem here

Free assembly is the primary expression of democracy. For you to asset that an employer with 100's of millions of dollars of resources can contrive legal agreements, collude with each other and fire people at their discretion because they exercise those rights is an admission that America is not a democracy but a corpocracy. You're suggesting as soon as ordinary people openly, legally, democratically, get together, combine resources for their mutual benefit it's your opinion that they should be un-employable. What about the companies that *do* want to do the right thing by their employees but can't because they have to compete with these unetical entities who act in secret collusion to derive profit from supressing their employees salaries?

These corporations operate in western countrys that protects them by rule of law devised by citizens. These companies don't deserve to enjoy the benefits of operating in a stable environment provided by a democracy if they are not going to pull their weight in securing the prosperity of the citizens who provide that stability. If the free market determines that the price of a good or service should increase because it's in demand then that applies to people as well. If their skills are in demand because they invested in education to develop it then why shouldn't they profit from the investment in their education free of any hidden machinations to suppress the very free market these corporations expect to profit in.

Most IT workers I know don't belong to a union because they expect companies operate by the same principles that drive a free market. Apple, Google, Intel, Adobe have created a precedence that demanded a response that no-one in IT should have ever had to seek all because they didn't want to share the prosperity of the IT industry with the people who make up the IT industry. Clear examples of corporations working to suppress the free market and upset the balance that has negated the need for unions in the IT industry for decades.

Re:And yet

[russotto]

Guess what? There is a minimum wage requirement on H1Bs.

Given a lack of standardized job titles, it's easy enough to fudge. Anyway, H1Bs are so dominant in some areas that their salaries set the prevailing wage.

There is a $6,000+ processing fee for H1Bs that act as tarrifs.

Not high enough to be significant.

A local worker can take an H1Bs job away at anytime by meeting the absolute minimum requirement of the job description and the job description must be posted in public at the company.

The first part isn't even true, and in any case the job description typically includes things which work out to "experience in this particular position.

The main problem is that H1B is 90% Indian and Chinese and there is a certain "hate" for such people. Do people ever mean H1B employees from England, Australia, Netherlands etc? Nope. By H1B, they mean Indian and Chinese high tech workers.

You can put the race card down now. About 64% are Indian, 8% Chinese. Do you ever see rooms full of nothing but English H-1B workers, with maybe one token American in sight? How about French? Australian? Japanese? You DO see that with Indian H-1Bs. Why is that, do you think?

Re:And yet

[chihowa]

That it's an undesirable situation is the point. The availability of H1B workers is a construct of US laws and the point of US laws should be to benefit the citizens of the US and the country itself. Hiring foreign workers (and not making them citizens and integrating them into the US) and leaving US workers unemployed and incapable of performing necessary jobs, as well as leaving US-based job functions dependent on foreign citizens, is an undesirable situation for the US and its citizens.

Anything that remedies the situation by training US citizens for US jobs is good for citizens and the country alike. A good clue to this is the fact that very few (if any) other countries have systems in place to displace their own citizens' jobs and deliberately sell out their country's knowledge and skill to foreign interests. Hell... if the whole situation didn't primarily benefit the extremely wealthy, shutting it down in the name of national security would be an easy sell.

WTF? Jailtime! Boycott violates Anti-Trust

[redelm]

Settlement? What settlement? This is a prima facie Clayton Act Anti-Trust violation. Multiple felonies, with jailtime due. Amazingly, this appearently exists on paper, so everyone who negotiated or signed it should go to jail.

The Clayton Act makes organizing supplier boycotts a prohibited activity. And that's just what they have done -- organized a boycott not to hire an employee, times the collective number.

That this has not gone to a Federal Grand Jury appears more like corruption than anything else.

Hang them by balls ..

[MonsterMasher]

Damn right it's too low!
.
Those bastards need to spend time behind f.ing bars, when you consider the pain ans suffering, moving, family brake-ups and suicides this kind of shit ends up doing to people, mostly men.
.
F.ing Tech companies of this size .. just go through top admin, and ALL boards of Directors, and take a vote for each manager, and nail there testicles or pussylips to boards and hall them up in the air ..
.
and let those that suffered, or anyone in the tech industry a bottle of salt water they can use to clean these people's wounds as they hang.. and tell them how it made you feel, to live with too little money .. they will pay attention if you spray when their eye's move away..
.
Thank them one for me!

and now we just use H-1B they don't complain

[Joe_Dragon]

and now we just use H-1B they don't complain about there pay or hours they don't even want to rock the boat as if they get fired they have to get out of the usa right way.

It's time for an union in IT RIGHT NOW.

Re:and now we just use H-1B they don't complain

[Anonymous Coward]

Doctors and Lawyers have large lobbying bodies (AMA and ABA, respectively) that represent their interests. Does a comparably large organization exist for Programmers?

Re:and now we just use H-1B they don't complain

[iced_773]

The ACM could be........but it isn't.

Re:and now we just use H-1B they don't complain

[Anonymous Coward]

I've read a lot of posts in this thread and it is amazingly clear to me that most of the posters here, who I assume are mostly from the US, simply do NOT know how a union works. I'm not sure why this would be, but I do realise that there is a lot of disinformation in the US about unions and they are not held in very high regard.

Here in Australia a union works like this:

  - You are hired by your employer as normal.

  - Some workplaces have compulsory union membership, which would have been previously negotiated. If you don't like it, don't take a job there. It's an interesting political debate, but at the end of the day, the compulsory union membership is to the advantage of the union which is to the advantage of the worker.

  - If you enter a dispute with your employer then you can ask the union for help. AND THEY WILL. Legal aid, counselling, wage advice, negotiating. All you guys on here saying "I should be free to negotiate my own contract" well guess what: you fucking can. But with a union, they're there to help you when that all goes tits up. Like when you get fired. If it was an illegal firing then the union can pursue legal means (with a much larger war-chest than you have) to either reinstate you, or, ensure you are paid all due severance payments.

  - If a group of you at work (who are all union members) are unhappy then the union will take note and with the will of the members (unions often vote before taking action like this) will pursue industrial action like holding a strike. This group mentality may sound a bit weird to you guys over there in the US, but it's actually a wonderful thing: people looking out for each other, people supporting each other, and being part of a community.

  - In case it wasn't obvious, union membership levies a small fee each year (usually a few hundred dollars, but it varies widely) to help fund its operation.

So I hope that's a better picture about unions and how they work. Are they perfect? Of course not, and they can become too powerful for their own good. And, it would be pretty frustrating have a problem, and to be a member of a union, but not receive any support from it. But to say that "all unions are bad" is a ridiculous overreaction.

In my opinion: anyone slating unions either doesn't know what they are, or, is actively against them since an organised and informed workforce can demand (shock, horror) better working conditions and higher wages.

For the rest of you, how's that clause in your contract prohibiting you from EVEN TALKING about your wage with other workers? Just stop and think about that for a fucking second. You guys are being fucked and you don't even know it. Where's this magical free speech you keep banging on about?

You know what it is? I've actually worked for a few companies in the US and I've been there, at ground zero, when someone has been instantly fired (typically illegal in Australia) and frog-marched out of the building. During the coffee break everyone was up in arms, shocked, and ranting about how unfair it was. Then, HR held the meeting in the afternoon to "debrief" and every person there clammed up tighter than a nun's bum. It was a fucking joke. No one was prepared to say a word. I stepped up and chewed out HR, chewed out the boss, and told them all they were a pack of pussies. But what I didn't realise at the time was that everyone was terrified of being fired. And I think the number one reason for that was the health care situation in the US. You guys are slaves to that system and until you pull your heads out of your arses and sort out the health care, then changes to workers rights and employment conditions will just be icing on a turd.
 

Re:and now we just use H-1B they don't complain

[russotto]

You can start by not signing another contract that forbids you from discussing your pay with fellow employees. Just that one step down the path towards improving workers rights may be enough for you to see the strength that comes from many united to a common cause.

In the US, it doesn't matter whether I sign such a contract or not. It's not valid.

Not quite accurate

[TiggertheMad]

Unions aren't the same a secret collusion between competitors. A better comparison would be a secret union of all tech workers that required that none of its employees take work with Apple until they raised their entry level salaries for engineers to 500k per year out of desperation. Also, unions are manipulating the invisible hand of the market, but they only exist as a result of the power that currently lies in the hands of capitol. If capitol hadn't collectively acted in a selfish and greedy fashion for the previous thousand years or so, unions would have never been formed. You could say that they are consequence of the invisible hand, but that is sort of a cop out, since any behavior related to the market (up to and including regulation) is a consequence of the market. Gotta love feedback loops.

Re:as one of the effected people

[fuzzyfuzzyfungus]

If the Americans are too expensive why would you enter a clandestine agreement to keep recruiters away from yours? Wouldn't you want the overpriced guy to be somebody else's problem? On the other side, why would your competitor be willing to offer a higher salary than you do if you are already paying too much?

This sort of agreement (especially given the legal risk involved) just wouldn't make much sense if you thought that the employees in question were already overpriced.

many companies exist to hire people

[raymorris]

> It's not about who is dispensable or not, companies do not exist to hire people ...

For many years I worked for a corporation that was set up primarily for the purpose of hiring people and taking care of those employees. For the last 12 months, the company has been losing money by continuing to provide health insurance and such for employees who work fewer than 12 hours per month.

You may think that's incredibly unusual, but actually it's not because many, possibly most, corporations are set up for the purpose of hiring a very small number of people, most notably the owners. There have been many times over the last 20 years when I, as the sole shareholder, have needed to choose between making more money or doing more good for the employees and customers. I decided that money is a means to an end. The PURPOSE if making more money would be in order to better take care of the people I care about. I'd like more money because it would allow me to send my daughter to a better school. I'd like more money because it would allow me to give more to my employees and other friends. I'd like more money because it would allow me to give more to organizations such as United Way and the Crisis Pregnancy Center. Choosing between being good to people or making more money, I choose doing good because after all the whole point of more money would be to do good with it. Choosing more money would be putting the means ahead of the ends.

Re:many companies exist to hire people

[dbIII]

the company has been losing money by continuing to provide health insurance and such for employees who work fewer than 12 hours per month.

Offtopic maybe, but one of the reasons the USA has lost film production jobs to "socialist" places like Canada and Australia is because those health insurance costs to the company do not exist. Instead there's a slight tax markup which is far less you would expect due to not having to waste a lot of cash funnelling it through insurance fat cats before it gets anywhere near the health services.

MOD PARENT UP

[serviscope_minor]

Flaimbait != disagree.

There is no disagree mod for a very good reason.

they exist to make products / provide services that allow the owners to make money,

No, that's not strictly speaking correct. I'm assuming you're referring to limited liability entities (LLEs). LLEs exist for the sole purpose of protecting the owner's personal assetsso that they can operate the company without personal risk.

Many of these are set up to make a profit (as are some non LLEs, like sole traders and partnerships), but by no means all of them are.

the whole point of business is to generate profit,

For profit making entities, then yes, the point is generally to make profit, for the owner. However, these are being granted special legal protections (limitation of liability). Why?

We do that for the greater good. We collectively appear to believe that profit motivates people, so providing a mechanism for companies to operate somewhat freely (i.e. with limited liability) is of net benefit to society. That's because they want to make a profit and they do that by doing useful things. On the whole.

But make no mistake: the point of limited liability companies is not profit, it's for the overall benefit of society. If that link is broken, then there is no reason for them to be given such protections. Of course, the owners are still free to pursue profit as they see fit, but why should they also have the right to do it without personal risk?

In other words, an indicidual might make a company to make a profit, but the reason LLEs exist at all is for the greater good, not for profit.

The problem in USA is not that Google and Apple had agreements not to hire from each other,

No that was a problem. Google and Apple are given amazing protections by law (limited liability), far more than exist in any naturalistic sense. It is entirely reasonable for them to also be constrained while they make use of these protections. In that way the law is completely reasonable and just and they broke it. What they did is plainly unethical.

it's that there are so few employers at all, and that's a problem of business costs being too high thanks to government rules, taxes, regulations, litigation costs, inflation etc.

They're not though.b You can set up a little contractor business with just you as an employee pretty easily. You can do it yourself if you feel like or if, like me that stuff turns your brain to mush, you can save hassle and pay someone else to do it. The overall costs are not that high.

The main problem is that businesses have been granted unnatural rights (limitation of liability) but are not keeping to the responsibilities that those rights must require. If anything more regulation is required to keep them in line.

"hobby" has made a million dollars. Mission statem

[raymorris]

Well you can make up your own definitions of words if you want to, I guess.
My "hobby", as you call it, has brought in over a million dollars. That million has been used according to the company's mission statement.

You know, people actually write down the purpose of the company when they create it. It's called a "mission statement". You might read some sometime. I've yet to see one that says "make money". I have seen a few companies where the people apparently FORGOT their mission, forgot the reason the company was started, and started focusing on money instead. That's why you put the mission statement in prominent places - posted on the wall, on banners, etc - to remind people of why you're there lest they forget.

Re:WTF? Jailtime! Boycott violates Anti-Trust

[Entrope]

Those who tried to leave probably succeeded. Can you cite to a single case where this anti-poaching agreement prevented an active searcher from getting a job offer?