Thinking of trying to recruit staff currently employed by a competitor but don’t know whether this is ethical or not? We outline the factors that you need to consider.
Whether it is ethical to recruit a competitor’s employees is a question that has been debated in the business world for decades. As an employer you know that your competitor’s staff have the skills, knowledge, and experience that you’re looking for, but is ‘poaching’ them really the right thing to do?
It’s a question that isn’t simple to answer so as recruitment experts here at Anne Corder Recruitment (ACR), we’re going to outline the factors you need to consider.
Legal considerations
From a legal perspective, poaching an employee from a rival could amount to a breach of contract if the new member of staff had previously signed a restrictive covenant with their former company. These covenants typically state that an employee can’t work for a competitor or have contact with their customers for a set period of time after leaving the business. Courts frown upon contractual violations and may levy stiff penalties against companies that break the stipulations of restrictive covenants.
Furthermore, the previous employer could take legal action for copyright infringement if they believe their proprietary information was shared with you by their former employee.
Due to this, companies should always ensure that their actions are legal and follow all relevant laws and regulations. Full service agencies like ACR are fully up to date with the latest laws affecting recruitment and contracts and can help you avoid potentially costly mistakes.
Business relationships
Poaching another company’s employees can quickly sour a professional business relationship you had with them.
That relationship could have included seeing each other as allies (rather than aggressive competitors) and perhaps even being collaborators on projects you worked on together.
Damaging that relationship is likely to cause tension between the two companies which may have far-reaching consequences, so it’s important to think carefully before trying to recruit their staff.
Competitive recruitment
Attempting to recruit a competitor’s employees could also lead to a cycle of competitive recruitment where you and they regularly attempt to poach one another’s top performers.
This is not beneficial to either company and will ultimately lead to unsustainable renumeration packages and inflated wages being offered to potential employees, and the likelihood that some new staff join your business in the hope that they are poached in the future.
This clearly impacts staff loyalty and motivation, as well as each company’s bottom line.
Reputation
Being seen to actively recruit a competitor’s best staff can impact your company’s reputation, either positively or negatively.
On one hand, rather than being seen as a ‘fair player’ in the market, it could give the impression that you’re focused on winning at any cost and don’t have high ethical standards. Additionally, poaching implies a lack of faith in your own capacity to find suitable talent through your own methods, which may reflect poorly on your organisation and its culture.
On the other hand, recruiting a competitor’s staff could give the impression that you’re focused on building a highly talented workforce made up of staff who are the best in the business.
However, generally from an ethical standpoint, poaching a competitor’s employees is seen as an act of unfairness. It undermines the principles of fair competition and gives the hiring company an advantage over their rivals.
Principles
Before thinking of recruiting a competitor’s employees, it’s always a good idea to develop your company recruitment principles first.
To do this, bring your top team together and establish a set of recruitment guidelines that
provide consistency across your business. Agree on the recruitment practices that you feel fit your business’s corporate identity and ethos, making sure they cover questions such as is it okay to recruit on the basis of an employee’s referral, would you consider it controversial to recruit an employee from one of your competitors, and how would you feel if they poached one of your best staff?
Also agree on how you will recruit the staff your business needs now and in the future. For example, if you do want to try and recruit a competitor’s best staff, you could consider using a headhunting agency who will manage the process for you. They will have experience of approaching standout candidates, as well as the resources, software, and tact that go a long way when approaching sensitive recruitment targets.
It’s imperative of course, that if you opt for a headhunting agency, that you select one whose ethics and approach match your own corporate identity. After all, they will be the first point of contact a potential high calibre candidate has with your business.
But when developing your principles and strategy, remember not to restrict yourself just to one method of recruiting. Although recruiting from a competitor works for many businesses, there are a huge number of other high calibre candidates out there who can be recruited through more traditional and open methods.
Conclusion
Recruiting a competitor’s employees is a common practice in some industries, but whether it is unethical or not depends on the specific circumstances and the actions taken.
But targeting competitor talent has never been easier. With the rise of social networks, particularly LinkedIn, it’s extremely easy to find your competitor’s top employees and send them a message with a tempting job offer.
However, in general it is best for companies to take a respectful and professional approach to recruiting, and to avoid intentionally poaching employees from competitors on a regular basis, especially if this contradicts with their company ethos. Instead, they should focus on building a strong employer brand and creating an attractive workplace culture to attract the best talent.
