You’ve seen them on LinkedIn and met them at a few trade shows, but now that you are so desperate for talent you are considering reaching out to your competitor’s employees in an attempt to hire them.
Before you begin drafting LinkedIn messages, consider a few do’s and don’ts of snagging employees from your competitors to avoid pissing off your competition and some nasty lawsuits.
DO: Offer a Salary Increase of 3% – 5%
Elaine Pofeldt wrote about scalping the competitor’s talent in Inc. this month in the article, How to Master the Art of Poaching Employees, and she recommends sticking increasing the salary if you want to compete with their current employer.
If you don’t have the funds to offer a bump in salary, consider giving them equity, but avoid scaring off investors and “limit the total amount of equity you distribute to no more than 10 percent to 15 percent.”
DONT: Hire someone with a noncompete agreement
Double check with your lawyer before extending any offer to a competitor’s employee. Pofeldt says that “in many states there can be repercussions for poaching,” and the last thing you need is a lawsuit from a competitor.
“The first thing a responsible employer would want to do is to find out whether the talent they want to snag is subject to any covenants, such as a noncompete agreement,”says Andrew J. Sherman, a partner at the law firm Jones Day in Washington, D.C.
DO: Approach employees when a a shake-up happens
If you hear about a competitor’s visionary or CEO leaving, this might be the perfect opportunity to poach their employees. When a visionary leader leaves, it signals to the remaining staff that the company might not be as solid as it was,” says Jaime Klein, CEO of Inspire Human Resources in New York City.
DONT: Expect Poached Employees to be Perfect
Norm Brodsky warns against hiring your competitor’s salespeople in the Inc. article titled, Why You Shouldn’t Hire Competitors’ Salespeople, because all the industry knowledge in the world can’t fix the bad habits they bring over.
Brodsky complained that his poached salespeople “thought they knew more than I did about selling our service and wouldn’t listen when I told them how I wanted them to do it.”
DO: Make Your Team Poach-Resistant
Polfeldt recommends doing the following things to avoid losing your employees to competitors:
1. Ask what matters to them and actually listen to their comments
2. Create a 12-month plan that lays out career growth and goals
3. Give the highest title you can without pissing off your other employees
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