Adani Group And Mukesh Ambani's Reliance Industries Sign A No-Poaching Agreement
The third-richest man in the world, Gautam Adani, and Mukesh Ambani, the head of Reliance Industries, have agreed to refrain from hiring employees from one another as part of a no-poaching pact. The agreement will be applicable to all of their businesses as of May of this year.
This agreement is intriguing since it was reached between two of the biggest conglomerates in India, both of which have recently entered markets where the other has a significant presence. Reliance has a major foothold in the petrochemical industry, and Adani Group announced its debut there through Adani Petrochemicals Limited last year. The high-speed data services, for which Adani has submitted a 5G spectrum bid, are the other area where their paths converge.
No poaching agreements have existed in India for a long time and are growing more common as the competition for talent grows and labour expenses rise. Companies are at risk from rising labour expenses, particularly in talent-scarce areas, and a potential bidding war can make this risk worse.
On condition of anonymity, a senior executive search consultant who works with both corporations said, “These pacts have always existed and they continue to be informal in nature. From here on both groups cannot poach from each other.” No poaching agreements are legitimate so long as they don't impede someone's ability to look for work.
According to a partner at a corporate law firm, as long as two entities are not market leaders in their respective industries, there is no law that prohibits them from making such agreements. Neither of these companies currently holds a dominant market share in any industry.