If you don't know, I'm talking about this: https://www.cnn.com/2013/01/17/business/us-outsource-job-china/index.html NPR and BBC also reported on this.

From what I've read, Bob only got fired by his employer. He did not get prosecuted or charged, or else I assume the news will state that as well.

I'm wondering, isn't outsourcing as an employee illegal? That company was also a critical company, so couldn't Bob be charged with leaking confidential information or something like that?

1 Answer 1


Many things that are "illegal" are not crimes and you can't be prosecuted or charged for them. Many "illegal" things are merely breaches of contract or civil wrongs, and even then, money damages obtained in a lawsuit are not always the primary remedy that is available.

Outsourcing an employee is not generally a crime, although it might or might not be a breach of an employment agreement. This wouldn't necessary be a breach of the employment agreement as a default matter, however.

Most U.S. employment agreements are oral and only specify the rates of compensation to be paid and the general nature of the job to be performed, because the vast majority of U.S. employees are employees at will who can have their employment terminated at any time with or without cause (although employees fired without cause are entitled to unemployment benefits, while employees fired with cause are not entitled to unemployment benefits, and unemployment benefit claims rates affect an employer's unemployment insurance rates).

Of course, if there was a non-disclosure agreement (which would almost always be in writing) and it was violated, breach of that agreement would often give rise to a lawsuit, and infrequently but sometimes, to a criminal prosecution (especially if the non-disclosure agreement were to protect state secrets rather than trade secrets).

Leaking trade secrets (or state secrets) to from someone subject to a non-disclosure agreement to someone not bound by a non-disclosure agreement or in violation of one's own non-disclosure agreement could be a civil or criminal offense, but an NDA violation might be a very challenging matter to prove beyond a reasonable doubt in a criminal case.

The linked story doesn't make clear what kind of employment contracts Bob the software developer at Verizon (a major long distance phone company) had, or how sensitive the work he was doing was at that job. There are no indications that his surrogate ghost workers in China were anything other than private individuals doing software development work that Bob otherwise would have done. It doesn't seem to be a case of national security or industrial espionage. It is possible that Bob even had his Chinese workers sign a non-disclosure agreement.

  • Isn't outsourcing as an employee a breach of employment contract?
    – No Name
    Nov 15, 2023 at 1:20
  • 2
    Very few workers in the US actually have contracts. There may be offer letters or handbooks that spell out expectations and policies (and the authors may or may not have thought to say "no outsourcing" if they didn't expect anyone to try such a thing) and generally the maximum penalty for violation is simply termination.
    – nobody
    Nov 15, 2023 at 1:47
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    @NoName Termination is usually the only remedy for a breach of employment contract, and usually employees in the U.S. are employees at will with only a contractual agreement (often oral) about employment terms. Whether outsourcing work in a default case with no express agreement on the point would be a breach of the employment agreement is not a very settled or clear in U.S. law since termination of employment of at will employee cases don't end up in court. If there was a non-disclosure agreement (almost always in writing) it would have its own terms which might or might not be relevant.
    – ohwilleke
    Nov 15, 2023 at 2:04
  • @NoName Certainly, outsourcing work as an employee is not a crime (absent trade secret violations in some cases). It would be a civil matter between the employee and employer. Many things that are "illegal" are not crimes and you can't be prosecuted or charged for them.
    – ohwilleke
    Nov 15, 2023 at 2:05
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    "Termination is usually the only remedy for a breach of employment contract": demotion? Pay cut? Also while it might not be strictly speaking a remedy for the breach of contract, couldn't certain tortious acts (that would presumably also constitute a breach of contract) lead to an award of damages? Also, from the article, "Bob" "physically FedExed his RSA token to China so that the third-party contractor could log-in under his credentials during the workday,” which seems more likely to constitute a crime than the mere outsourcing.
    – phoog
    Nov 15, 2023 at 12:10

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