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Cognizant caught poaching?
By siliconindia
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Monday, 28 March 2011, 16:05 IST
Bangalore: Talent battle is a serious issue among the Indian IT biggies. "Poaching" or "employee raiding" is what it is known as in the IT world. Employee poaching is become a more prevalent issue in India due to the IT sectors fast growth. IT firms have charted out strategies to poach efficient employees from their competitors. A law suit that that was recently filed by HOV Services against Outsourcing Services giant Cognizant Technology Solutions will explain the process of poaching in more depth reports Patrick Thibodeau of ComputerWorld.
HOV Services, a Chennai based business process outsourcing firm alleges Cognizant that it obtained a list of 450 HOV employees details that includes their salary, bonuses, their "production efficiencies" and customer project names as well. The lawsuit that was filed in late January in federal court in New Jersey claimed.
The case against Cognizant revolves around potentially illegal steps Cognizant might have taken in its efforts to recruit HOV employees, not poaching alone. For example, if it turns out that Cognizant did, as the lawsuit claims, gain access to HOV employee information, it could be further found that steps it took to get that information violated the New Jersey Computer Related Offenses Act.
The lawsuit claims that Cognizant "induced" then current HOV employees to email information about the 450 employees. It says that these now former HOV employees confessed to sending the information to Cognizant, "and as a result their HOV employment was terminated."
IT firms are constantly keeping a watch on their employees and have adopted stringent measures to keep their employees from jumping ship to join rival companies. Employers also use noncompete agreements to avoid raiding.
Alan Marcuis, an attorney at Hunton & Williams LLP in Dallas, says that poaching, or raiding, isn't illegal. "I'm aware of no law in any jurisdiction in the United States that prohibits employee raiding or employee poaching," he said.
If a poaching incident triggered legal action, it would be due to other issues, such as the loss of intellectual property or disclosure of trade secrets -- some form of a contract breach involving a particular employee, Marcuis said. In the U.S., the Department of Justice pulled back the covers last year on antipoaching agreements between Apple and Google, Apple and Adobe, and other companies.
In an effort to address the broader issue, the Indian IT industry group Nasscom issued an "ethics framework" for IT industry late last year that sets out guidelines for hiring. Those guidelines include a suggestion that companies ask new hires to gain "final clearance" from their current employers before starting a new job.
Nasscom also wants to discourage referral payments to employees who provide leads on prospective recruits from their previous employers.