How wrong is it for a headhunter who's worked for the equities dept of Bank X to then poach people from X for Bank Y?
Very wrong according to most banks, which are doing their best to stamp out the practice with so-called 'off-limits' or 'non-compete' agreements. Signed at the time headhunters pick up mandates to fill roles, these specify that they won't be able to pull anyone out of that department for a specified period in the future.
This is all very well in theory, but recruiters complain off-limits agreements are becoming a problem as banks try to extend their scope.
"Off-limits agreements are definitely becoming more onerous - but they can be difficult for banks to enforce," says Andrew Chancellor, head of financial services at Robert Walters. "Some banks will try and insist that if you have an agreement with them you can't headhunt anyone out of the department for two years after it was written."
Another headhunter says banks are being unreasonable: "In extreme cases, some banks are trying to demand that you can't pull anyone from the whole organisation for the next year," says one. "It's just not worth it - unless they're going to give you 80m in business."
The HR director at one US bank in London says these kind of business-wide arrangements are rare; the bank only has one in place and gives the headhunter in question plenty of business to compensate.
Despite unconfirmed rumours of a court case against a headhunter who breached an off-limits agreement in the US, plenty of search firms seem willing to ignore highly restrictive clauses - even if they've signed up to them. "It's very difficult to prove," says one. "Who's to say the person we're placing didn't approach us first?"