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Samsung and LG accused of collusion to keep employee wages down

General
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Last updated: September 13th, 2016 at 07:37 UTC+02:00

A civil lawsuit has been filed against Samsung and LG as they have been accused of agreeing to not steal each other’s employees in the United States. This allegation is not that uncommon in Silicon Valley. Just last year, Apple and Google along with several other companies in Silicon Valley settled a similar lawsuit for $415 million. The case was based on a “no-poaching” pact between these companies which prohibited them from recruiting each other’s employees.

This proposed class action lawsuit has been filed in a Northern California federal court by an ex-LG sales manager who accuses both Korea companies of antitrust violations and colluding to drive down employee wages. A spokesman for LG has said that “no such agreement has ever existed” while Samsung declined to comment on this report.

A. Frost, the plaintiff in this lawsuit, claims that he was first contacted by a recruiter who was seeking to fill a position at Samsung over LinkedIn back in 2013. Frost says that he was later informed on that very day by the recruiter that “I made a mistake! I’m not supposed to poach LG for Samsung!!! Sorry! The two companies have an agreement that they won’t steal each other’s employees.”

The lawsuit alleges that it is “implausible” that such a deal between the rival companies could have been reached in the United States without their headquarters back in South Korea not knowing about it. The lawsuit does not state a specific damages amount but the proposed class action is likely to seek damages from both Samsung and LG.

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