Employee Poaching and Its Prevalence

Discuss the statement “Should company poach employees from competitors”?

In the highly competitive business environment, the available talent pool in an organization emerging from the employees’ skills, knowledge and experience is regarded as an important source for the firm’s competitive advantage (Stansbury & Sonenshein, 2012). Owing to the limited number of talented professionals in the specific fields, organizations are often faced with ongoing competition to recruit only those employees that have shown their level of expertise in their areas of specialization (Li & Sheldon, 2011). Most of these employees are always working in competing firms and therefore, interested firms are always attempted to ‘poach’ such talents for their competitive edge. Hansen (2005) observes that since organizations rely heavily on the competence and experience of their human capital to generate revenue, the potential economic harm that poaching inflicts on the affected firms is often severe. For this reason, poaching as an act of hiring workers from competitors has been a subject of discussion and heated debate among ethicists and other practitioners.

Employee poaching is always prevalent in considerably competitive companies that require highly skilled professionals to work in a specialized task. While the act is aggressively practiced in many organizations across the globe, it has become a point of contentions among employers, and this has facilitated the enactment of many regulations that ensure the safety of such highly sought talents (MacKinnon & Fiala, 2014). Presently, organizations require their employees to sign various agreements such as non-compete, non-disclosure to ensure that they remain loyal to their employers within a specific period during which they are not allowed to engage with their competing rivals in business.

Ethicists have considered the ethical parameters that border the conduct of organizations to poach employees from other competing firms. According to Bass and Steidlmeier (2006), the debate over whether or not poaching of talented workers from other firms is ethical continues to rage as companies are left to largely depend on which side of the fence they find themselves and how it affects them economically. The article published by Terra Staffing Group (2015) highlights some of the benefits inherent in hiring employees from the competition.

Poaching allows organizations to employ people with fresh ideas, new perspective and are up-to-date with business trends, events and the best practices in their respective industries. Besides, the departure of talented professionals from competing firms is also likely to open doors for other like-minded people or customer to join the new employer creating a competitive business environment in the long run (MacKinnon & Fiala, 2014).  From an ethical perspective, utilitarianism this conduct of poaching creates a win-win situation since it allows the transferability of highly sought out skills from small-scale organizations to large-scale, growing and high-value firms.

Ethical Considerations of Employee Poaching

The utilitarianism moral position posits that behavior is considered morally justifiable if it contributes to the happiness of the most significant number of people in the end. Mellahi, Morrell, and Wood (2010) observe that as a consequentialist, proponents of the utilitarian moral theory argue that an action is only right when it seeks to maximize the consequences to a large number of people. In this case, therefore, poaching from competing but small-scale organizations will help larger firms to create more revenue by using the highly skilled workforce they have acquired (MacKinnon & Fiala, 2014). Besides, with their high level of skills and experience, the employees pose a considerable burden to small-scale employers who may find it hard to pay to recompense them according to their competence and therefore, when competing organizations recruit such workers, the responsibility is somehow offloaded. The employees are also allowed to earn more according to their level of expertise in larger firms. In other words, poaching creates a win-win situation where both the employing company and the one whose workforce has been taken benefits.

However, virtue ethics presents the conduct of poaching from a slightly different perspective. In their argument, (Taylor, 2002; Banerjee et al. 2006) observe that whereas deontologists may define virtue as those traits that people who feel the obligation to fulfill their duties possess and consequentialists define them as traits leading to a good outcome,  virtue ethicists refrain from such attempts. In other words, virtue ethicists resist the temptation of determining virtue in terms of other concepts or events such as duty or consequences which are considered as fundamental (Banerjee et al. 2006). To the proponents of this school of thought (virtue ethics), virtue or excellent character of particular conduct is a disposition that is well entrenched in the actor or possessor. In a way, moral justification of an act does not depend or rely on other factors to validate it instead on the moral disposition of the person acting.

From virtue ethics position, the morality of business organization to poach employees from other competing firms is considered not from the consequences of the actions or deontological obligation but rather on the morality of the actor (Bass & Steidlmeier, 2006). The conduct must be triggered from a virtuous position for it to be considered to be morally justified. As it stands, most organizations poach highly skilled workforce to ensure that they become competitive and maximize their revenue while beating their rival firms in the industry. Most companies may seek to recruit employees from other organization as a way of overcoming the competition by ensuring they retain a competitive edge over their competitors. According to Bishara and Westermann Behaylo (2012), some organizations may use the approach to incapacitate their rivals in the business space to ensure they monopolize the market to increase their revenue. To this extent, poaching employees from the competitors are not morally justified because it aims to ‘cripple’ the opponent or competitor in the business to gain more significant market share. Onwuegbuzie and Ugwuanyi (2016) observe that a virtuous entity must develop a certain complex mindset which requires a wholehearted acceptance of some unique range of considerations as justifiable reasons for a particular behavior.

Utilitarianism and Poaching

Like Kantian perspective, virtue ethics considers poaching of employees as morally wrong. While business organizations that hire from their competition recognize their vice in their conduct, they still disregard the wholehearted acceptance of the initial considerations for a morally justified behavior of the behavior. On his part, Kant formulated a categorical imperative in which he emphasized the universality of human actions (MacKinnon & Fiala, 2014). In other words, Kantian universalizability principles demand that for any action of human conduct to be permissible, the actor must be willing to let their actions to be universal laws which may not lead to conflicts of interests. To him, a morally justified action should be universally accepted by all people without compromising on what they value the most (Onwuegbuzie & Ugwuanyi, 2016). Similarly, virtue ethicists maintain that any diversion from what one considers to be the right thing to do is itself morally wrong (Stansbury & Sonenshein, 2012). Although virtue is viewed a multi-track disposition, it would be considerably reckless to attribute one incident to an agent by relying on a single observed action, but when the action is done with evil intentions or reasons, then it is wrong and not morally.

Furthermore, virtue ethicists propagate the distinctive relationship that virtue has with eudaimonia which is an ancient Greek moral philosophy that translates to happiness or flourishing (Van Hooft, 2014). According to Onwuegbuzie and Ugwuanyi (2016) virtue is a trait that can be considered to be a constituent or at least contributes to eudaimonia. For this reason, eudaemonists believe that moral agents must develop virtues since they help to eudaimonia, namely happiness to human society. Thus, poaching of employees from the competitions does not always guarantee the expected happiness in the business environment, but instead, it creates reasons for enmity and strife relational management.

Slote (2010) observes that eudaimonia can be considered as an avowedly, moralized concept of happiness which everybody should seek to ensure harmonious living and coexistence. Thus, any behavior or actions that try to compromise the happiness of one moral agent; in this case business organization must be stopped and warned against the conduct.  Virtue ethicists agree that living a life in adherence to virtue is necessary for eudaimonia (MacKinnon & Fiala, 2014). Happiness is a concept that many philosophers noted to be supreme in the life of moral agents and it triggers other actions that seek to achieve it (Francis, 2009; Audi, 2012). As a supreme good, eudaimonia cannot be conceived of as an independent or isolated aspect of human nature, but it must be viewed within the context of human existence.

Virtue Ethics and Poaching

In their article, Gardner, Stansbury, and Hart (2010) provide a plausible extension of the arguments presented by virtue ethicists. The authors refer to the employee poaching as lateral hiring where one employer intentionally identifies, solicits and employ an individual or group of workers from competing firms to the organization. They adopted the use of critical genealogy to carefully demonstrate that the modern practice by various organizations to discourage lateral hiring is aimed at controlling the turnover of their workers.

While such constructions are a source of heated debates and criticism especially in regard to the autonomy of the employees and the use of employer power to control the will of their workers. Many other scholars among whom Mellahi, Morrell, and Wood (2010) have argued that the autonomy of the employees which is also expressed in their ability to seek employment even in competing firms, should never be compromised or denied by their employers. To these groups of scholars, the employees have the right to move around to different employment opportunities so long as it provides them better working prospects and they are likely to be more fulfilled in the end.

Nonetheless, the article by Gardner, Stansbury, and Hart (2010) underscore a fundamental argument which seeks to extend the position that has been postulated by the virtue ethicists. According to the authors, lateral hiring is morally wrong and therefore any measures that business organizations institute to control the vice is justified regardless of the reasons behind the action. To them, the current employers are justified to manage their human capital within their institutions through the use of those stated regulatory measures such as non-compete and non-disclosure agreements.

Arguably, Gardner, Stansbury, and Hart (2010) argue that organizations often put a lot of investment in training and developing the skills and knowledge of their workforce and therefore, having a considerable control on them is morally justified. The employer establishes the desirable skill sets and developmental experiences that competing organizations see or witness in the employees’ commitment to the respective companies. The organizational investment in the firm’s workforce provides some level of rights to the company to control the departure of the skilled workforce to ensure that the organizations retain their competitive edge.

Conclusion

As observed from the discussions, poaching is morally acceptable to the extent that it helps in enhancing the overall effectiveness of organizations in employing highly skilled staff that ensures production of quality output. Various philosophers have however posited varying opinions with regards to this concept, and therefore, poaching of employees should only be practiced when it makes both parties involved happy. Organizations should thus engage in poaching when the cost incurred in the process is less than the revenue that is anticipated by employing the new skills.

References

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Bass, B. M., & Steidlmeier, P. (2006). Ethics, character, and authentic transformational leadership. Ethics, 12, 42.

Bishara, N. D., & Westermann?Behaylo, M. (2012). The Law and Ethics of Restrictions on an Employee’s Post?Employment Mobility. American Business Law Journal, 49(1), 1-61.

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Gardner, T. M., Stansbury, J., & Hart, D. (2010). The ethics of lateral hiring. Business Ethics Quarterly, 20(3), 341-369.

Hansen, F. (2005). The Cost and Benefit of “Poaching”.   Retrieved from https://www.workforce.com/2005/11/08/the-cost-and-benefit-of-poaching/

Li, Y., & Sheldon, P. (2011). Skill shortages: Where labour supply problems meet employee poaching.

MacKinnon, B., & Fiala, A. (2014). Ethics: Theory and contemporary issues. Nelson Education.

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Slote, M. (2010). Virtue ethics. In The Routledge companion to ethics (pp. 504-515). Routledge.

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Taylor, R. (2002). Virtue ethics: An introduction. Prometheus books.

Terra Staffing Group. (2015). The Pros and Cons of Recruiting Talent Away from Your Competition.   Retrieved from https://www.terrastaffinggroup.com/seattle-recruiting-services/

Van Hooft, S. (2014). Understanding virtue ethics. Routledge.