Is It Unethical to Recruit Former Employees?

You’ve just been offered a position as CIO of a profitable and forward-looking financial services company. The company that currently employs you has treated you well, but this new job will give you more authority (not to mention more money). You can’t pass it up. So you don’t.

In your new position, you will need to hire an IS director and a network administrator, and you can’t think of anyone better than Julie and Bob, each of whom has been working for you for more than three years.

You signed a noncompete agreement with your old employer that prohibits you from recruiting anyone from your technical staff for a period of one year. But these two positions are so important to your new venture, and the opportunities would be so wonderful for Julie and Bob, that you are reluctant to leave them behind. Since the courts in your state tend to favor the employee in most noncompete disputes, you are not particularly worried about litigation. What you have is an ethical, not a legal dilemma.

Chances are, you are not alone. “Intellectual competency is growing by leaps and bounds, and the labor market is so tight that most companies are using noncompetes in an attempt to protect their intellectual property and training dollars,” says Boston-based employment attorney James F. Rogers.

That same tight job market has put CIOs in the uncomfortable position of having to choose between taking their best people with them and getting off to a great start, or honoring their contractual obligations and putting themselves at a competitive disadvantage.

What should you do? “My own advice to a CIO who is leaving a company is not to take people from his or her current organization,” says Rich Brennen, managing director of the IT practice at Spencer Stuart, an executive search firm. “If by taking someone you do damage to the company, then it’s ethically wrong.”

Would you listen to Brennen’s advice and leave without a word to Julie and Bob about the possibilities that could lie ahead for them? Or would you whisper, “Call me” as you walked past them and out the door? Tell us what you think.