Gentlemen`s Agreement Recruiting: An Unwritten Rule
Recruiting has evolved over the years. From print ads, job boards, and applicant tracking systems to social media, the cloud, and artificial intelligence, hiring managers are always on the lookout for the best talent to bring into their organizations. However, despite these technological advancements and the increasing focus on diversity and inclusion, some companies continue to practice what is known as “gentlemen`s agreement recruiting.”
What is Gentlemen`s Agreement Recruiting?
Gentlemen`s agreement recruiting is an unwritten rule that has been in practice for decades. It is a process where hiring managers make informal agreements with other companies not to poach their top talent. It is also sometimes known as the “no-poaching agreement.”
This agreement is usually practiced by companies that operate in the same industry, geographic area, or have similar business interests. The agreement may be verbal or implicit, and it prevents companies from competing for talent, which can be harmful to jobseekers.
Why is this Practice Harmful?
Gentlemen’s agreement recruiting is harmful to job seekers who are looking for better job opportunities and growth. If companies agree not to poach talent from each other, job seekers may miss out on a chance to work for a company that can offer them better pay, working conditions, and advancement opportunities.
Furthermore, this practice can create a monopoly in the job market, where a few companies have a grip on the best talent and limit the chances of other smaller companies finding top talent. This can have a significant impact on innovation and competition in the industry.
The Practice is Illegal
Gentlemen`s agreement recruiting may seem like a harmless practice between companies, but in reality, it is illegal. In 2016, the U.S. Department of Justice and other federal agencies issued guidelines that made it clear that these agreements violate antitrust laws.
According to the guidelines, these agreements can limit job opportunities, depress wages, and reduce the mobility of employees. Companies found guilty of such practices face penalties and hefty fines.
Conclusion
Gentlemen`s agreement recruiting is a practice that some companies use to limit competition and retain top talent. However, it is harmful to job seekers and can be devastating to smaller companies. This practice is illegal, and companies found guilty of it can face serious consequences. As a hiring manager, it is crucial to focus on attracting top talent and not limit opportunities for job seekers.