Google Masters Bad PR: Fires Engineer Who Leaked Pay Raise Memo

Last Updated Nov 11, 2010 8:25 AM EST

Yesterday came the news that Google (GOOG) planned big pay bumps for everyone in the company: a 10 percent across-the-board raise, $1000 holiday bonuses, additional money equal to annual incentive bonuses, and merit bonuses to boot. But don't feel bad for the investors, because Google took a step to control costs. It fired the engineer who leaked the memo from CEO Eric Schmidt.

Every company wants to control competitive information. And clearly Schmidt has long wanted to become Steve Jobs. But for Google to fire the poor schnook who passed along the information is unfair and inept on many different levels. If any company could write lessons on how not to handle public relations in a tight situation, it would be Google. All management would need do is print out a list of what the company has done over the last year or two.

It should have been screamingly obvious to management that with 23,331 full-time employees, the thought that Google could keep such a massive pay hike under wraps doesn't even rise to the level of naiveté. There is simply no way this could remain a secret.

Even more confounding is the thought that Schmidt and company would even want to keep this secret. A memo to all employees clearly told them that it was financially worthwhile to stick around -- the whole point of the payment exercise, of course. But as Peter Kafka of All Things Digital pointed out, for a company that needs to keep attracting talent (to make up for all those engineers who moved to Facebook), you'd think that it would want prospective employees to know. Unless, of course, someone decided that advertising all that money to be had would simply discourage people.

Now for a more subtle PR point. When you include the following in the risk section of your most recent 10-Q filing:

Our performance largely depends on the talents and efforts of highly skilled individuals. Our future success depends on our continuing ability to identify, hire, develop, motivate, and retain highly skilled personnel for all areas of our organization. Competition in our industry for qualified employees is intense, and certain of our competitors have directly targeted our employees. In addition, our compensation arrangements, such as our equity award programs, may not always be successful in attracting new employees and retaining and motivating our existing employees. Our continued ability to compete effectively depends on our ability to attract new employees and to retain and motivate our existing employees.
and you're about to spend tens, if not hundreds, of millions of dollars a year to make employee compensation more expensive, then perhaps you might consider the fact to be something material to report to shareholders.

Finally, how do you justify firing an engineer for passing on a memo when the company's CEO has been a one-man public relations wrecking ball?


Image: Flickr user woodleywonderworks, CC 2.0.
  • Erik Sherman On Twitter» On Facebook»

    Erik Sherman is a widely published writer and editor who also does select ghosting and corporate work. The views expressed in this column belong to Sherman and do not represent the views of CBS Interactive. Follow him on Twitter at @ErikSherman or on Facebook.