Is it unethical to steal employees from other contractors?

A contractor whom I regard as a friend sent me a letter recently that reads in part as follows:

“ I would like to make a suggestion for an article for you to write. It would be about contractors trying to steal other contractors’ employees. The market is outstanding, but the labor force is poor ...

“As you well know, good contractors spend years developing good employees. This includes expensive training programs. We pay the extra costs to bring in young people to train for the future. As a result of the current labor shortage, ‘slugs’ are making ridiculous offers to any tech they can steal.

“Employee pirating is becoming a more serious problem in my city, and I’m sure it is going on across the country ... Contractors across the country read and respect what you say, and hopefully your approach on this subject would enlighten some of these slugs to change their hiring tactics.”

He’s right about one thing. This is a good subject for an article. But not the one he wanted to read.

Give Me Liberty: You see, as I explained in a phone conversation to him before writing this column, I believe it is my friend who had his head you know where on this issue. I’ve heard this complaint throughout my four decades in the business, although usually the other way around, i.e., the “slug” contractors complaining about better firms “stealing” their people. Here’s how I see it.

First, we don’t “own” our employees. Serfdom and slavery ended ages ago. No matter how much we spend training them and pampering them, this is America. Our employees are free to work for anyone they wish.

An exception is if they have an employment contract binding them to you for a given period of time. It’s not customary in our industry to offer employment contracts to service technicians, but nothing is to stop contractors from negotiating such arrangements if they really feel their technicians are so valuable to them. Maybe this is something to consider. Keep in mind, though, that any contract prohibiting a technician from working for anyone else would also obligate you to certain conditions that you might find onerous, such as guaranteed income no matter what the business conditions. Employment contracts are common among high-ranking salaried professionals, and maybe it’s a possible solution to this problem. But without a contract, your employees are free agents.

Many contractors say it’s OK to hire someone else’s employee as long as he or she comes to you for a job, but it’s “unethical” to recruit them away. That’s “stealing.” What B.S. Is it really stealing if the other guy offers a better package?

Your first obligation is to your own business, not to everyone else in your market who competes against you. If I am willing to spend more money than my competitors on advertising, vehicles, equipment and everything else that gives me a competitive edge, why is it unethical for me to offer more pay and benefits than they do to attract the best technicians? And why should I not try to recruit them away from my competitors so that the technicians and I have the opportunity to improve our lives?

I’ll tell you what’s really unethical. It’s when contractors in a market collude among themselves not to go after one another’s employees. If everyone did this, good employees would never be able to change jobs. They’d be locked into a modern form of serfdom. Not only is this unethical, it’s probably illegal. The antitrust folks at the FTC frown upon this kind of behavior. Count me out.

Who’s The Slug? I am a bit puzzled by this contractor’s claim that it is the “slugs” in his market who are going after the employees of the “good” contractors. Usually it’s the other way around. One of two things may be happening here as nearly as I can tell.

First, if a slug firm is able to offer better pay and benefits to a technician than you are, it starts me wondering just who is the slug? Second, money is just one of the reasons why people work for a given company. Most technicians who are happy with their jobs, their working conditions, their benefits, their long-term future with a company and so on won’t change jobs just for a few extra bucks. It’s easy to flatter ourselves thinking we are a “good contractor,” but we’re doing something wrong if our employees find it attractive to work for an inferior firm for a little more money.

Our economy is humming and has been for many years. Ours is not the only industry with a tight labor market. Banks, law firms, health care facilities, computer companies, you name it, routinely go after one another’s skilled employees to try to improve their own position in a competitive marketplace.

Check out the want ads in the Wall Street Journal advertising for highly paid professionals with specific kinds of experience. Who do you think responds to those ads? Mostly they are people working in the same field for competing firms. Those other industries accept this as a fact of life. They don’t complain about competitors “stealing” employees from them. They react by ratcheting up their own compensation packages and working conditions to attract and keep the best people.

It’s not easy seeing someone leave who you regarded as a loyal, valued employee. Believe me, I’ve been there, more often than I care to remember. But I also have a solid core of people who have stayed with me for many years, turning down numerous other job offers. You win some and you lose some. This is the American way.

Let’s Have A Bidding War: The more I think about it, the angrier I get at the thinking of so many people in this industry who hold back opportunity for technicians by agreeing not to “steal” them from one another. It’s the same backward mentality that leads to the belief that anyone charging more than the “going labor rate” of $55 or $60 is a rip-off.

In my opinion, the best thing that could happen within our industry would be an all-out bidding war for the best employees. I’m willing to participate, even though it might cost me some of my good people.

Let every contractor keep upping the pay and benefits they offer top-notch service technicians. No holds barred. Recruit aggressively with newspaper ads, TV ads, supply house ads and word-of-mouth. Find out who are the best technicians working for your competitors and call them at home asking what it would take for them to come to work for you.

Unethical? Hell no, this is good, tough, aggressive competition. The kind that made America great.

And you know what? If everyone did this, before long the compensation levels for service technicians would be up where they ought to be, and this would persuade many more talented young people to enter our field. Everyone would have to raise their prices to realistic levels, and there would be enough good service technicians around to staff all of our businesses. And guess what? There’d be enough profitable work for everyone!

Better make your employees happy. If you don’t, someone else will. Watch out, your competitor is on the prowl.