HR Mavericks

Eddy’s HR Mavericks Encyclopedia

Employee Poaching

Unlike poaching wildlife, employee poaching is generally legal, and is even considered ethical under certain circumstances. Continue reading to find out what employee poaching is and whether it might be useful to add to your recruiting methods.

What Is Employee Poaching?

Employee poaching is defined as recruiting talent from your competitors. It’s also referred to as lateral hiring, and can be a great way for your organization to acquire new talent. By understanding how to effectively persuade others to join your organization—and how to prevent your own employees from being poached—you can maintain a competitive advantage for your company.

Should Recruiters Engage in Employee Poaching?

If your company is deciding whether or not to engage in employee poaching, you need to understand the pros and cons to make an informed decision. While employee poaching allows your company to acquire talent with a proven track record, there are still several risks involved.

Pros of Employee Poaching

  • Lower training cost. By poaching employees who are already top performers in their field, you avoid the training costs your organization would have to spend otherwise. This means you can catch them up on the higher-level operational side of your organization more quickly.
  • Experience. A top performer may have just the experience your company needs to take your organization to the next level. By poaching an employee with the expertise necessary to perform a job, you can give your company an advantage over the competition.
  • Understand your weaknesses. If you are the company who has unfortunately been poached (which is certainly never a good feeling), then this may give you an opportunity to evaluate your current relationships with your employees and economic arrangements. By understanding what has caused an employee or employees to leave, you can respond to that and prevent future poaching to occur. Creating a plan in advance to prevent poaching from happening in the first place is the best approach.

Cons of Employee Poaching

  • Legal issues. Many companies have agreements with their employees that prevent them from disclosing trade secrets or working for competitors, such as non-compete or non-disclosure agreements. These agreements are violated if confidential information or intellectual property is shared with the new employer. If you decide to poach employees from other companies, you may find it beneficial to first check if they have non-compete agreements in place.
  • Ethical issues. While the act of poaching is considered ethical, if you are specifically targeting the top-performing employees of another company with malicious intent, this would be considered unethical. For example, if you poach a member of management and they end up taking the whole team with them, this could damage the operations of your competition. It could also end up damaging your company’s reputation.
  • History repeats itself. Once you’ve poached an employee, there is a risk that they may choose to leave your company for a different one. They’ve already proved that they are willing to do just that. There is also no guarantee that the new employee will fit in well with your culture. Cultural fit could be the reason they decide to jump ship again for another company. This can also have an effect on other employees in your organization and could lower morale.

Tips to Prevent Your Employees From Being Poached

Understanding how to retain your top performers and high-potential employees is extremely important. Your employees are literally a click away from other organizations trying to poach them. Even though you can’t prevent other companies from trying to poach your employees (anti-poaching agreements are generally considered illegal in the United States), you can still take measures to retain your talent by following the tips below.

Tip 1: Identify Engagement Drivers

What exactly do your employees value? The answer to this question may be more than benefits or pay. It could be career progression, working towards earning a new title, learning new skills, taking on new responsibilities, having more authority, flexibility in scheduling, or even time off. If you aren’t getting feedback from your employees on what they value, you don't know what motivates them to stay. You might even consider creating focus groups with your top performers to understand what they value in their workplace.

Tip 2: One-on-One Interactions

Do your managers know how to lead conversations centered around the professional and personal progress of your employees? It’s important that managers learn to take an interest and create an increased sense of belonging for employees. Help create a career path for your employees and give them something to work towards. Outline what’s possible to achieve in their job, and develop clear steps that show how to arrive at a specific destination. This is especially important for remote workers, who may feel more isolated compared to employees who work in-person. You can also encourage remote workers to increase their networks and connect with others, which can lead to feelings of greater purpose in the workplace.

Tip 3: Fair Compensation

Even though pay and benefits may not be the only thing that employees care about, you should still strongly consider what the market rate is for positions in your industry. Organizations in competition with your company are offering specific benefits and pay ranges, and it’s important to stay on top of what they are. If you know what your competition is offering in terms of pay and benefits, then your employees likely know as well.

Methods to Persuade Competitor’s Employees to Join Your Organization

While the idea of recruiting for top talent can be exciting, it’s important to realize who your company should and should not persuade to join your company in order to avoid legal issues. Once you determine this, then you can consider approaching your competitor’s employees.

Hire a Third-Party Recruiter

One of the benefits of hiring a third-party recruiter to contact a possible candidate is that they typically don’t disclose the name of your company until you get into interviews. This is a subtle approach and allows the recruiter to gauge interest without disclosing too much about your company.

Create a Positive Approach

Be respectful of candidates and willing to create long-term relationships with them. High performers of other companies may be more willing to be open to new job opportunities if you take the time to get to know them. LinkedIn and other employment network sites can allow you to do just that. Attending professional networking events in your community can also be a great way to get to know other experts in your field. Find out which employees you want to meet beforehand to make the best use of your time.

Ask About Restrictive Agreements

Don’t forget to ask candidates if they are subject to any restrictions that they may have agreed to with their current employer. Even though you aren’t legally required to ask about these, you technically still could be held legally responsible. If there are restrictive agreements, then you must take corrective action.
James Barrett

James Barrett

James has worked in the HR field going on 5+ years and has held various positions of leadership. His areas of expertise are in benefits, recruiting, onboarding, HR analytics, engagement, employee relations, and workforce development. He has earned a masters degree in HR, along with a nationally recognized SHRM-SCP certification.
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