The Recruiter Honeypot

> I haven't had to make my life depend on employees as of yet

And that's where your opinion comes from.

To be absolutely clear, I am not putting you down. I am merely stating what I believe to be a fact.

I see a lot of opinions on HN that obviously come from people who have never actually run a business. Of course, everyone is entitled to an opinion with the caveat that opinions loose a lot of validity when they are not backed by "skin in the game".

Bringing an employee onboard is an expensive process. The search itself can be expensive. If you found the employee through an agency you owe the agency a finder's fee. This typically runs from 15% and could be as high as 50% of the employee's salary. To put numbers to that, if you pay someone $100K and the agency charges 25%, you, the employer, owe them $25K.

Of course, it doesn't stop there. There's a lot more to employee compensation than the agreed-upon salary and recruiting costs. A quick Google search located this calculator:

http://www.artlogic.com/resources/employee-cost-calculator/i...

Using that as a reasonable reference I calculated that, if you keep your $100K/year employee for three years your annual cost is $150K per year.

If, however, you only keep them for one year (change "Expected term of employment" to "1") the cost goes up to $170K per year.

If we look at a $150K/year employee who leaves in one year the cost of that employee sits at around $240K.

Even this doesn't paint the entire picture. Bringing someone onboard takes work and will definitely consume clock cycles. More than one team member is likely to be involved in the on-boarding process. Overall productivity will be affected during this period until the new hire comes-up to speed and can "solo" if you will. The effort isn't trivial at all and it costs thousands of dollars for every hire.

There's also a hidden "cost" which takes the form of internal competitive data that you have to trust your employees with. Nobody thinks that this is a cost until you go through the experience of training someone for months only to have them go work for a direct competitor. These things do happen, and believe me when I say that it never sits well. At that point thin ethical walls protect you from a competitor gaining a leg-up through ill-gotten insight. This very directly equates to money.

The cost of poaching by --presumably-- the very agency you might be working with is also not trivial. You just dedicated a ton of money and time to bring someone onboard and the agency convinces him/her to go elsewhere. Now you are left with a hole to fill, which will take time and money. During that time team productivity will take a hit, product delivery will suffer and you will be distracted away from product and business development in an effort to fill the hole. I can't put a precise number on this but believe me when I say that it ain't cheap.

So, yes, anti-poaching is fair and just. For some it takes going through the pain of having this happen once or twice to understand the concept.

I'm not in recruitment myself, and I agree that ideally you want your employees not to leave even when contacted by a recruiter!

I assume the idea behind refusing to work with recruiters who have been unethical in the past is to create a disincentive, in the hopes of reforming the economics of recruiting so you can get recruiters who will work with you rather than against you.

You'd imagine there would be some recruiters who would aim to behave ethically and to cultivate a reputation for being ethical, as that reputation would be valuable to a recruiter in terms of getting clients.

The one time I was job-hunting I saw some pretty unethical stuff - I once had a recruiter e-mail me a programming test along with a solution another candidate had submitted, and almost every recruiter asked for a summary of technical interview questions so they could brief other candidates. I would have thought using unethical recruiters would actively hinder your recruitment process - so there'd be no market for their services.

I mean, evidently it doesn't work that way, but I think that's the aim of refusing to work with certain recruiters.

An employee that leaves after a year has decided that they do not want to work for you. This employee is sacrificing a year's worth of work mastering your processes, environment, and code base in order to go start over somewhere else where they need to learn a new code base.

A couple thousand dollars isn't enough to convince most people to start over- something about their current work place made leaving seem attractive. Either the job does not fit them well or have reasonable paths for advancement (both from a development and career perspective), you are underpaying the employee, the work/social environment is bad, or something significant in their personal life has changed (graduating college, spouse got a job somewhere else, ect).

Poaching isn't unfair. You never have any guarentee for how long an employee will work for you, just as your employees have no guarentee they will still have their job tomorrow. The problem in the above situation isn't poaching; the problem is the employee wanted to leave.

Yeah, LinkedIn is awesome, it's the future of finding a job second only to your "connections".

I've employed people and hope to again soon and the conclusion to your post is 100% wrong. All the costs you mention are your problem. Finding talent is expensive. But it's expensive to everyone. You're spending all that money to find someone willing to invest their precious time and skill/knowledge with you instead of spending that value some other way. That doesn't make them your slave. You don't get any special rights because you spent money.

If you want to keep people give them a compelling reason to stay. Collusionary practices like anti-poaching, Noncompetes and so on are not fair and just. They are immoral and bad for the markets. Engaging in any of these practices should come with hefty fines.