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Fellow Weekly - Issue 108
WHAT'S THE LAW ™
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Encouraging intelligent and entertaining debate at your Shabbat table.
Fellow Weekly raises issues of business law and ethics through lively emails by featuring your real-life scenarios answered by our leading authorities and professionals.
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Case # 210/211 Sahara Air and Coca Cola Poaching Incidents: A Battle for Talent Sahara
Real Life Scenarios: What would the halacha have been in these cases pulled from actual contemporary news items?
Sahara
Jetways Airlines invested time and money into Teddy Martins, a promising and skilled airline captain, sending him through a rigorous sixth-month New Generation Aircraft Training Program. Upon his successful completion of the intensive and highly specialized course, Jetways promoted him to man the next generation B777-300LR Fly-By-Wire, a futuristic and technologically advanced craft.
Four months later Sahara Air, Jetways' rival airline, poached Teddy by enticing the now-expert pilot with a $30,000 raise in pay plus other perks. Teddy was soon under their wings!
Jetways responded by suing Teddy in Indian court for joining Sahara Airways.
In May 1998, Pepsi filed a petition against the Coca Cola Company, alleging that Coke had entered into a conspiracy to disrupt its business operations. Pepsi accused Coke of luring away three of Pepsi's key sales personnel from Kanpur, going as far as to offer at least one of the employees the Indian equivalent of $20,714 a year in pay and perks, almost five times what Pepsi was paying him.
The other sales personnel, who were earning the equivalent of $994 a year, were offered a salary equivalent to $3852. Many truck drivers in the Goa bottling plant, who were getting $51 a month, moved to Coke, where they received $207 a month.
Pepsi claimed that these tactics were causing immense damage, as those employees who had switched over were carrying with them sensitive trade-related information.
What is the law?
Please email us with your comments and answers at weekly@projectfellow.org
Read next week's issue for the answer!
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Case # 208/209: Meds & The Baffled Babysitter XII
Meds
Ear thermometers, surgical tape, single-use capillary blood sampling devices, sterilizing solutions and more...Two years passed since the Adlers relocated to Ramat Beit Shemesh. By now, Dr. Adler secured his permanent Israeli medical license, and set up his private practice as well. In due time, Adler became a loyal customer of RIMS (Rofeh Israeli Medical Suppliers).
On Thursday Sept 15th Yaron Avraham, a salesman for EMES (Emergency Medical Supplies); RIMS' competitor showed up during lunch; to convince Adler to switch suppliers and receive more for less.
- May Yaron convince Adler to switch suppliers?
The Baffled Babysitter
Wondering why she was experiencing a lull in her employment by the Greens, [See Issue 92] Bracha did some investigative research. Did Temima present herself to Mrs. Green as a more talented young lady and willing to work for less?
- May Temima convince Mrs. Green to hirer her instead of Bracha?
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What's the Law?
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The Answer
We present you here with a concise ruling. For a more intricate elucidation, please see the detailed explanation below.
Yaron may convince Dr. Adler to switch suppliers.
Temima may advertise that she is available for hire but may not convince Mrs. Green to hire her instead of Bracha |
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Detailed Explanation
Meds & The Baffled Babysitter XII! invokes the following laws
1. A local entrepreneur may open a competing establishment. Darchei Moshe forbids it if doing so will compel the original enterprise to fold [Darchei Moshe 156] .
2. A competing establishment or service provider may offer perks and better deals than the first enterprise in order to entice customers to switch to the competition [Choshen Mishpat 228:18]. Darchei Moshe forbids it if doing so will compel the original enterprise to fold [Darchei Moshe 156] .
Note that the guidelines for aggressive targeted marketing practices at the competitor's loyal customers are delineated in points 4 and 5 below.
3. Once B decides to hire or buy merchandise from A, A has attained a sense of opportunity security.
While Competitor C may publicize his/her higher bid, C may not jeopardize A's security by approaching B with a higher bid until A walks away from the deal (see Issue 107) [Choshen Mishpat 237 Prisha 1].
If C jeopardizes this security, Beit Din may publicize that C is "a rasha" and "evil," as well as penalize him/her, but cannot force C to return the merchandise, the service, or the position to A. (Let C extend the effort and obtain a similar item somewhere else!) [Choshen Mishpat 237:1, Pischei Teshuva 2; Yam shel Shlomo: Kiddushin 3:2].
4. In a relatively "closed market" economic environment, tenure and customer loyalty create the same level (if not more) of "opportunity security" as would B's decision to hire or buy merchandise from A.
Thus, C may not manipulate B's employer or loyal customer to forgo his/her long-standing trusting relationship with A.
A modern day example of a closed market environment can be found in the medical field; namely a family doctor. In the US, families generally stick with their pediatricians for decades. A new doctor may not cajole patients of the old doctor to switch over to his/her practice [Tosafos Kiddushin 59a].
5. In an "open market" economic environment, tenure and customer loyalty do not afford the provider with "opportunity security." Instead, the provider is always wary lest he/she lose the customers to the competition. Under such conditions, C may attempt to manipulate B to forgo his/her long-standing and trusting relationship with A.
A modern day example of an open market environment is an internet service provider. Consumers generally do not build "trusting relationships" with their providers. Provider B may call Provider A's customer and cajole him/her to switch over to the service B upon the termination of the contract with A [Choshen Mishpat 237 Prisha 1].
Application
Arguably, families like the Greens build trusting relationships with their babysitters. A constant babysitter like Bracha is likely to develop a sense of opportunity security without having to look over her back lest the competitor beat her to the job next week. We would view such employment as a closed market economic environment. While Temima may publicize her better rates, she may not approach Mrs. Green and cajole her to employ her in Bracha's stead. Let Temima find other employment somewhere else.
Nevertheless, in the competitive market of medical suppliers, each provider is well aware that doctors will constantly be looking for better opportunities across the global economic environment. RIMS know that Adler's loyalty is due simply to the fact that he has yet to find a better deal by a competitor. As such ROFEH would not be guilty of "stealing" RIMS loyal customer, even by approaching Adler and convincing him to switch.
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Note:
Although we aim to present the correct ruling, varying details are always important and decisively influence every individual case. Our readers are thus encouraged to present their personal cases to a competent authority and not solely rely on the information provided.
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