Google, Apple Allegedly Conspired To Keep Wages Low: Lawsuit

Japan, Tokyo, Ginza, Chuo-dori Ave , part of the facade of the new Apple Computer store featuring the Apple logo.
Japan, Tokyo, Ginza, Chuo-dori Ave , part of the facade of the new Apple Computer store featuring the Apple logo.

Despite a heated rivalry, there's one thing Google and Apple allegedly worked together on: underpaying their workers.

Former employees of the companies filed a new complaint on Monday in an attempt to expand a lawsuit they filed last year into a class action case representing up to 100,000 technology workers. Much of the complaint was redacted for privacy reasons.

The lawsuit claims that Apple, Google, Intel, Intuit, Adobe, Lucasfilm and Pixar made "gentleman's agreements" to not recruit each other's employees between 2005 and 2009. By doing so, the lawsuit claims, these companies "artificially suppressed" wages in a rigid pay structure.

In addition, the suit alleges that former Apple CEO Steve Jobs, former Google CEO Eric Schmidt and Intuit chairman Bill Campbell helped enforce recruiting bans. The lawsuit cites "CEO-to-CEO emails," do-not-call lists, and an analysis by UCLA economist Edward Leamer finding that the alleged poaching bans kept wages low.

"Google has always actively and aggressively recruited top talent," a Google spokesperson wrote in an email to The Huffington Post. Spokespeople for Intuit and Adobe said they do not comment on pending litigation, and a spokesperson for Intel wrote in an email: "We disagree with the allegations." Apple, Lucasfilm and Pixar did not return requests for comment.

The companies tried to get the lawsuit dismissed, but a federal district judge in California ruled in April that they must face the lawsuit.

The findings, if true, would counter the technology companies' reputation for treating their employees relatively well and for trying to steal the best workers from one another. Google lavishes its employees with three free meals per day, and Google and Apple have a reputation for high pay.

Apple and Google are competing to dominate the mobile device, computer and software markets. Their fight has gotten ugly at times, with Apple and Google suing each other over patents.

Their choking off of competition may have helped enable them to keep wages low. Google and Apple controlled 83 percent of the smartphone market in August, according to Forbes. Apple's iPad alone controlled 55 percent of the tablet market in the third quarter, and Google's Android software powered another 44 percent, according to ABI Research.

Update: This article has been updated to include responses from Google, Intel and Adobe.



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