Some low level recruiters got fired for just doing their jobs, engineers got shafted out of good high paying jobs, and shareholders are stuck with the bill. Meanwhile the top management of these companies escapes unscathed. Stuff does roll downhill.
You are right, it must be againtst the law. But to be honest I find this argument only too weak. Let me strengthen it a bit:
This praktice is one of the main reasons why students don't go to study engineering. They know and feel that you -as an engineer- might become part of this 'people play' praktice. Unfortuntately, those students are damned right: They say "You are stupid if you want to study engineering, it is better to do management or so".
If this is proven to be true (and I know that this praktice is happening) I hope that this court case will give a global change. It certainly will solve our shortage in engineers !
So much for the free market or is that only applied when it's convenient (i.e. banks)? I noticed a lot of those CEOs/managers/stockholders are making a pretty penny. Imagine how much money consumers could save if they could collude and pay select business people what consumers deemed enough. If consumers decide to spend less, it is considered an economic down turn and everyone starts sniveling. If employers (consumers of labor) collude and decide to spend less on select employees, there is no such sniveling. Oh but this is different they would say. Employees are a cost no matter how much profit they generate because they are only a commodity; but we business types are not a cost because we generate revenue and therefore indispensable. If engineers are not sufficiently compensated for their hard earned acquired skills in the market place, like any other business investment, would they not seek other, more profitable ventures (careers)? Several times I have read too many stories of industrious engineers creating actual products for non-engineers to sell (who try selling customers the sizzle but not the steak) and the engineer's creations makes a lot of money. Then when it is time to divvy up the spoils of war, engineers find themselves cast-off because they didn't sell anything and just hid out in the lab while others did the real work.
Settling for such a lower number does not make sense. But i think making consensus between 64,000 people is a tough task and most of them will go with what the lawyers will say. This case could have been historical case and could set a precendent for the corporates against setting up anti-discriminate policies against employees.
These "agreements" between large companies may have had a chilling effect on compensation for the ambitious and talented, and were obviously illegal because they settled, but consider the laws of unintended consequences. One of the benefits of companies holding their employees is that it slows down significantly the swirling movement of intellectual property. IP Entropy, if you will. Good employees constantly learn things while employed or they wouldn't be top performers. An officer of his/her company can be pretty sure that their company's IP is not going next door if their employees don't go next door. This minimizing the entropy, so to speak. Start mixing the reagents and turn up the flame of that bunsen burner and all of the sudden we've got IP soup forming. IP is gold so companies will be compelled to do something about that. What form will that take? Will it make things better for pay?
This is ridicules. I wouldn't settle. The payout to individuals based on the amounts and number of people affected comes to a measly $4687. This practice could easily have reduced individual incomes by at least 5% over 5 years. For a base salary of $100K annual that comes to at least $25K in lost income - per person! Granted all people covered by this class would not fall into this income bracket, but I'll bet a significant number fall above this bracket.
I would urge members of this class to not accept the settlement and make the companies really pay for their collusion.
So 1/3 to 1/2 is going to go to the lawyers right off the top. So it's more like $2,000 each because it gets peanut-buttered across all 64,000 folks. It may (or may not) get prorated by how many of the years in question each one was employed by one of these corporations. (Probably will be, because the lawyers get to bill for that "service" too.) The real shame is that it's going to everyone, instead of the much smaller number of folks who saw real economic harm and missed out on salary bumps that are cumulative over the rest of their careers. Still, it's OK as a remedy, because it did have the effect of restraint of trade and keeping everyone's salaries down through the corporations' unethical price-fixing through their annual salary surveys. And it really does have a long-term impact on the behavior of the corporations, at least for the next 10-15 years until the next crop of MBAs doesn't have the benefit of institutional memory anymore when the current crop retires / moves-on.
To answer the question, above, the law against it is called the Sherman Anti-Trust Act.
And finally, its still going on. They call it an annual employer's salary "suvey," but its really price-fixing. If any of these companies did the same kind of "survey" of product prices, they would be in front of a jury faster than a Federal Prosecutor can say "It'll position me great for next years election!"