> Turnover at an acquired company isn't unusual, nor is friction in the transition.

Things are a bit different in Germany than in the USA when it comes to this.

Would you care to elaborate?

>>> Turnover at an acquired company isn't unusual, nor is friction in the transition.

>> Things are a bit different in Germany than in the USA when it comes to this.

> Would you care to elaborate?

Here's an attempt at an explanation:

Both turnover and friction occur during acquisition in Germany as well, obviously. And indeed friction is probably independent of nations (and their differing laws and cultures), so I'll focus on turnover.

So, turnover. The legal notice period in Germany is (ignoring exceptions) at least one month, and up to seven months by law. Often employer and employee contractually agree on even longer minimums, three months are quite usual. There's also an unspoken expectation that permanent employees are in for the long haul. By contrast, IIRC many US States allow essentially zero notice period, and the famous two weeks' notice is essentially just courtesy.

Culturally, there's also stronger (albeit eroding) attachment between employers and employees. Especially in Mittelstand companies, such as Grohmann seems to be, the owner takes the stance of a benevolent patriarch, taking his responsibility for his employees seriously, and workers tend to reciprocate, and be very protective of their boss. In fact, such a company structure and climate may well be a factor for when considering an employment offer.

Since identification with a company can thus be very strong, there would be considerable reluctance to leave, especially at such a critical time. You don't just leave your colleagues and your customers hanging. In fact, perhaps it was this sentiment which caused Klaus Grohmann to throw in the towel, when he realised he was expected to work against the best interest of his clients (and, by extension, employees).

I assume that such a departure of a patriarch will be a strong signal to the rest of the company.

very interesting. thank you very much.

If Tesla was smart and gave these aquihired employees adequate golden handcuffs and noncompete clauses then I agree. But if they didn't and key employees just leave and use their expertise to start another company that helps out the competitors again then Tesla will have played themselves.

This isn't software that a team of 6 can replace in 6 months. This is stuff like assembly lines, metallurgy treatments, the characteristics and quirks of specific machines, and requirements of suppliers. These can't just be replaced by a rogue team leaving.

On the contrary. The rogue team leaving knows how to build and maintain the assembly lines, invented the metallurgy treatments, designed and built the machines, and created the supplier network themselves. Without the team, the automated manufacturing business is probably not worth nearly as much. The team can go elsewhere and repeat the feat.

No, no they didn't. They inherited the machine, or bought it from someone else. This isn't software engineering, where people bootstrap their compilers.

They signed exclusive contracts with suppliers.

They designed parts which took many iterations of surface finishes and annealing schedules and tolerances to get right. Each iteration requires months of turnaround time and $€£ in manufacturing costs.

Sure the team can go elsewhere. But it will take them almost as long to set it up the second time around, and almost as much money.

It can easily be argued that those people are the real value behind this acquisition. Even if they could be replaced easily (not likely) it would still be a huge blow.

Agreed, the loss of institutional knowledge will cripple the team. However, what I am arguing is that they leavers won't be able to take the business elsewhere just with what is in their heads.

It could go poorly. Those are good points. It was a decent but if they retain talent and deprive competitors. Takes a long time to start a company and Tesla is likely attractive place for engineers so they will prob retain employees and IP to make it palatable if not profitable

> If Tesla was smart and gave these aquihired employees adequate golden handcuffs and noncompete clauses...

BTW noncompetes are illegal in California where Tesla is based.

Grohmann Engineering is a German company. Can someone chime in on the legality of non-competes in Germany?

Totally legal, as long as the employee is paid at least 50% of their salary after they leave for the full duration of the non-compete period.

http://www.lexology.com/library/detail.aspx?g=2bae173f-7fe4-...

That actually sounds fair given the circumstances. Paid time to either stay out of the market and relax, or to transition to a fresh field unaffected by the non-compete.

California law is not relevant to employees living and working in Germany.

AFAIK in Germany con-competition agreements are possible with the maximum term of two years.