The "red badge" thing was very real. It was really weird having TVCs on your team. You'd all work hard together to launch a thing, and then everybody except the red badge would get a celebratory team tchotchke or a team lunch or something. If you asked about it, the manager would say "we can't give Jim things directly because that might be like compensation and they'd be like an employee." There'd be all-hands meetings they couldn't go to, or seemingly arbitrary doors they couldn't open or internal sites they couldn't see. If you worked with a TVC, you'd get training that felt like you were learning how to own a House Elf: "Remember, never give them clothing or they'll be free! And report them if they ever claim to work for Google."
i was a red badge. it was fucking demeaning. i have a lot of stories, but my favorite was when everyone on my floor got an earthquake safety kit except me. literally google didn't care if i lived or died.
the expectation was that if i sucked up enough ("demonstrated my value") they MIGHT make me a real boy, like some bizarre Velveteen Rabbit fetish game.
i loved watching how Google would continuously pat themselves on the back about how good they are to "their employees," and then openly shit on the people who worked full time at the company but technically weren't FTEs.
it's a caste system. a company that behaves this way should be run out of town with extreme prejudice. but instead they somehow took over San Francisco.
Ok but then contractors have the freedom to work whatever hours they want, not show up to the office, and subcontract out their work - right? If so that might be more appealing than being an employee
Not in practice, because they use a hiring entity to dictate the terms. You're expected to show up on a schedule, do the work etc. much like a FTE, but you're not an FTE.
I think some folks have this illusion of software contractors that this is somehow common, it really isn't. The norm is you-are-almost-but-not-quite an employee type work environment, and thats at the better places.
I've worked at a place where contractors were treated like they weren't human, basically. Worst equipment, forced to work in an old warehouse that barely passed code to be considered retrofitted for an office, people routine got sick out there because they were exposed to the elements. Not to mention, during fire season (this was California) they were in a building that didn't have a good enough air filtration system, so they were forced to sit in smoke all day, more or less
I quit that place pretty quickly, but it was nothing short of terrible
I think the GP's point was that's how it should be. If a company is going to -- for "legal reasons" -- not treat contractors the same way they treat employees, then they should be doing so not only in bad, exclusionary ways, but also in good ways, with the expected perks of being a contractor that FTEs don't get: freedom to set their own hours, work where they want, and subcontract out their work.
But no, companies like Google want to have their cake and eat it too: they want a class of workers where they can require of them more or less the exact same things that they require of their employees (and much more easily fire them), but can give them a lot less, and treat them like a second class.
That's entirely Google's choice. It does not have to be that way. But they've decided to create this two-class system for their own benefit, not for anyone else's.
Also consider that these people are probably often not contractors in the legal sense. They're likely W-2 employees of some sort of staffing agency, who are then placed at Google. Google pays the staffing agency, the staffing agency pays the "contractor" a salary (significantly less than what Google pays the staffing agency), and all is fine... legally, anyway.
>> Google pays the staffing agency, the staffing agency pays the "contractor" a salary (significantly less than what Google pays the staffing agency), and all is fine... legally, anyway.
The staffing agency vig is so high it is practically the same as an FTE.
I used to work for a temp agency (clerical, not in tech) and I remember once seeing what my agency was getting paid for me on an hourly basis. Iirc, it was something like 3-4x what I was getting paid hourly. It was kind of sickening tbh. Plus many agencies forbid temps from being hired away without paying an outrageously hire fee to do so.
It felt like being an indentured servant in many ways. The only upside was that if you hated the place you worked, you could always ask to be reassigned someplace else. But that's the only major plus I can think of.
The most profitable consulting-type businesses have profit margins >=50%, before distributing profits to equity holders. But either way I'm not sure about your implicit assumption here that the profits should be comparable to the pay of the employees.
Hey, you began your comparison with the most profitable consulting firms…
2 things -
1) Accenture has an EBIT of 20%.
2) The tippy top of the consulting pyramid plays on branding in a way that the average firm does not.
The VAST majority of service driven firms will not become McKinsey etc. making this a poor comparison
Finally - I doubt that the top firms have those margins, I would most definitely like to be corrected though. If you could clarify or share your source, I’d appreciate it.
Note I mention profit before distributing to equity holders. The highest prestige and therefore most profitable consulting companies are all partnerships.
Some highly profitable consulting companies that are partnerships have very high margins, if you don't include the profit sharing component of the pay of equity partners (but do include bonus and fixed salary). The primary public source I can point to is that many top law firms publish their margins to be >=50%.
As for McKinsey, according to Google, McKinsey has 10k consultants and 2700 partners. There are 30k employees, so I give you that the overhead rate is higher than law firms. But
given how different pay is between partners and non-partners, and there is still a relatively large portion of partners compared to other employees, the margins, if calculated this way, is probably still pretty high.
Now is this the right way of considering profit margin? There are some good reasons to disagree with it. But in the same way people can like or dislike EBITDA. At least, it's like nobody discounts Larry and Sergey's cut from Google's profit.
In this context, I would argue it is indeed a good way, especially for the purposes of discussing the discrepancy between grunt pay and hourly charge. It tells us that a very large part of that discrepancy goes to equity partners (who aren't those doing the execution work), rather than "overhead" as it's being argued. This is very different from big-corp type public companies where, even though executive pay is a lot, the bulk of the pay goes to shareholders ans a large number of rank and file and moderately paid middle-managers, which I suspect to be closer to accenture's profile.
The idea of equity in a consulting-type business is pretty strange, on the face of it.
Leaving aside the partnership fair/unfair model, equity = access to capital.
But consulting-type businesses are essentially headcount machines, because the product is 1 person's time.
So why do you need access to capital?
Granted, it makes expansion easier (hire ahead of work), but as far as profit distributions go, what are equity holders providing in exchange for their slice of the profits?
Primarily, you want an apples to apples comparison. A law firm is a service provider, however not a consultancy. The service the two types of firms provide are not directly comparable.
Furthermore, a law firm is a place where your assertion - “ discrepancy goes to equity partners (who aren't those doing the execution work)…”
Senior partners are pretty critical in bringing and keeping clients.
In my previous service company, we aimed for 10%, which was considered the norm. However, we were particularly bad at achieving this, with only 8-9%, though we did have a good atmosphere and happy employees
Getting to profit through pure people power is hard. Every next person you add doesnt double your output. It’s maybe increases it by some %. (This includes overhead costs)
FWIW, this isn't the case at Google (or many other large technology companies). Google dictates the staffing agency markup (which is very limited) and audits for compliance.
This, among many other processes, has significant negative impacts on the quality of the agency that will work with Google on this sort of work - but it does help with cost control.
(Source: I ran one of these agencies, and Google was a past client.)
> They're likely W-2 employees of some sort of staffing agency, who are then placed at Google.
This is precisely what Samsung does in Austin at its fab, via Randstad. I was a supervisor, and had about 50:50 FTE and Contractor. They were treated exactly the same, including getting pizza parties and the like. The main – and largest – difference was FTE benefits were awesome, and Contractors got the bare minimum required by law (Texas, so basically nothing).
I often complained about this to management, to no avail. My main argument was that we were training people to quit and go work for Intel or GloFo as FTEs. Didn’t seem to matter.
I hate this model so much. Just pay people if you want FTEs.
It is a shell company, except that it is not Google (or its equivalent) who is creating it. It is the Infosys and Cognizants (or other bodyshopping firms) of the world who create this structure to satisfy the demand created by the Googles.
I mean classic example are contracting out food service in the corporate cafeteria. You contract the work to some random other company who hire people to do food service or do you want Google or whoever to start hiring cooks themselves? Janitorial staff is also a classic role for this style of employment.
That's quite different - Google contracts for a service to be provided and takes no interest in managing janitors and cooks individually. The red badgers sound like they're being given individual instructions but denied employee protection.
Two different kind of outsourcing contracts. And red badgers, unless they are freelancers, have employee protection. Just not from Google, or any other company using subcontracting agencies for that matter.
but looking at it from a top down perspective, it does seem like google treats these contractors no better than the janitors and cooks. So i dont think you can say it's different merely because the nature of the work is not the same.
The difference between a legitimate third party service and these ought-to-be-illegal body shop arrangements is whether Google is paying for a specific service—e.g. clean offices—or people that they boss around.
Google managed to hire their first chef in 1999 and manage them directly, I'm sure they can manage a global team of cooks better than anyone else if they wanted to, because of their specific needs and so many global offices to spread the gains through. It's all just a decision they took.
Google has infinite money and doesn't have to care about things like that. They can waste money on food just like they waste it hiring 10000 engineers who don't do any work.
What surprises me the most is how a corporation like Google is incapable of meeting temporary staffing needs internally, by shifting people already on their payroll around projects. It's as if they are just admitting that they are shit at managing projects and workloads and scoping work to the point that they need external help to plug these gaping holes in their load management.
How many people do they need to pay to manage this contractor circus? How much effort do they waste sourcing contractors, tracking work assigned to them, treat contractors differently even interns of security processes, and dealing with higher attrition levels? So much waste.
That’s not legally a contractor then. As someone who has done contracting, both for software and in construction plus has hired them and had to be advised by lawyers around the legality of what makes or breaks a contractor…
If you are setting their hours, bossing them around and/or providing equipment they are not a contractor they are an employee. This is the law in 100% of the United States.
>That’s not legally a contractor then. [...] If you are setting their hours, bossing them around and/or providing equipment they are not a contractor they are an employee.
There are 2 different uses of "contractor":
(1) contractor : official IRS tax classification of 1099 independent contractor
(2) "contractor" : a W-2 employee of a "temp agency" or "staffing agency" or "bodyshop" that is sent to a client company (such as Google) needing contingent workers. Adecco[1] is an example of a staffing company that sends people to Google. These temp agencies with workers classified as W-2 employees act as legal cover to "avoid repeating Microsoft lawsuits". From Google's perspective, these Adecco employees are "contractors".
If the above working arrangement looks convoluted with the economic inefficiencies of paying for an extra middleman (the temp agencies), it is. But it cleverly avoids the IRS claiming, "Hey Google, your so-called contractors are misclassified and should be employees!" ... and Google can say, "They already are employees! They're Adecco employees!"
The "1099 real contractor" is not as common as "fake-contractor-but-really-somebody-elses-W2-employee" ... because the "1099 contractors" won their lawsuit against Microsoft.
The tax reform act of 1986 removes the safe-harbor provision for engineers and programmers. This strange sentence means that if a company hires an engineer or programmer - as an independent contractor - and the IRS later decides that this person is really an employee, then the company is liable for back taxes and probably penalties. For other professions, the "safe harbor" provision means that the company is only liable for paying the employer share of taxes going forwards - the previous stuff is handwaved away.
In effect, this scares companies so much that it is very difficult to get hired as a 1099 contractor as a programmer/engineer. The vast majority of companies will require you to be a W-2 employee of some other company (which will be the "staffing agency" or "bodyshop" or "temp agency").
One programmer was driven to fly his aircraft into an IRS building due to this issue.
I'm a mostly fake contractor. I miss the good old days when I could fake contractor directly to companies. Now I have to go through a middle-man that takes a cut. I still make triple what I was making before, but it bothers me that the middle man is likely taking 30-50% off the top.
These laws do not protect workers, they protect entrenched wealthy body shops.
IIRC they can, but only if the other company is also paying some proportion of the costs relative to how many of their employees are present, or something like that. It's been a little while but the rules are in some training presentation or other.
And the ruling makes it
clear that it’s based on the actual on the ground reality, which is why vendors get pulled in the same way.
If the main company is the one giving the vendors employees their direction, managing them, setting hours explicitly, they get included in all hands, etc. then the main company is also on the hook for being their actual employer as far as benefits, taxes, etc. go.
So there needs to be a clear delineation at all times, or bad things happen to the primary company regarding costs.
> Ok but then contractors have the freedom to work whatever hours they want, not show up to the office, and subcontract out their work - right? If so that might be more appealing than being an employee
Depends on the agreement. First off, probably 99% of these contractors work for a contracting company, so as a contractor you have no say: You are an employee of (another) company and they'll set the rules.
If you're truly independent, then sure - try to make whatever agreement you want with Google.
Which is because it is extremely rude, like meanest of meanest, to not share food with each other. Like, of all mean but not illegal things you can do to contractors, not sharing food is probably what people consider the worst. Small every day things are way more provocative than abstract things like retirement funds or whatever.
Been there. Done that. The FTEs got strawberries. I didn't. I don't think I have been that pissed off in my life. If someone had wrecked my car on purpose I'd be less pissed.
I experienced something similar at a previous job. It was funny. I was working in a satellite office for an org based in a different country, and once in a while (minimum once a year) we'd be sent to HQ for a few weeks. Wrapping up projects, team coordination, whatever. So of course we'd eat together.
The team got a new manager when I joined, and he was told that our treatment was equal despite satellite office status because we were on the same teams coordinating on the same projects, but in different timezones.
Anyway, even though I was technically a FTE at the company, I didn't have the necessary prerequisites to pay for cafeteria food at FTE discounts. I was forced to pay contractor prices. A full extra $5 per meal. My manager was initially confused, then upset. Then we tried to talk with the cafeteria contracting company. They told him it was out of their control. So, we began investigating...eventually uncovering some internal "separate but equal" undocumented employment scheme were compensation, benefits, whatnot, unraveled into a weird caste discrimination system. The people that were pulling their weight were paid pennies while senior team members who were awaiting retirement just raked in the big bucks with benefits on contracts no longer offered, or offered through some backdoor deals before the company really expanded.
In the end, the lunch situation was solved by just stating that I was a FTE because I had the same color badge. It turns out the cashiers didn't even
scan badges or anything, just asked you if you were internal and to show your badge.
But out of all the bullshit we uncovered, the food situation really broke his spirit the most.
I don't get it. Why would you be pissed if those were the rules of the company you were contracting to? As a contractor you get paid more than the regular employees because you take on a greater risk (such as being fired at any moment without any explanation) and you do whatever you're told. If you don't like it you can always look for another client. My point being you can't have your cake and eat it too. Does it suck sometimes? Yes. But such is contractor life.
Hospitality is a fundamental virtue. Skimping out on food is maybe the fundamental transgression of norms. The anger is subconscious and maybe primal.
I was a "contractor" from an in practice body shop consult agency, not an actual contractor. I did every day office work for three years, being part of a normal work group going to every day meetings etc.
But I don't think that matters. If you have an actual consultant in the office, being there once a month, you give him strawberries too, if you hand out strawberries.
Also, the pay was somewhat lower. I was fresh out of uni so I didn't know better.
Notably, only bosses two layers up thought it was a good idea to skimp on the strawberries etc. The bosses that had to deal with the ensuing bad mood ensured there was no such distinction between FTEs and "contractors".
I think we're talking about different things: contractors are paid more than regular employees doing the same thing. And they don't have any benefits the actual employees have.
> Also, the pay was somewhat lower. I was fresh out of uni so I didn't know better.
What you describe is outsourcing, not contracting.
The body shop and their client call it contracting. If one will follow the mantra of "words mean whatever people use them as" then this is contracting.
> Why would you be pissed if those were the rules of the company you were contracting to?
Not being on the Google health or retirement plan is one thing. That's something you can do maths to, see if your alternative arrangements make sense.
But witholding food is something that feels anti-human. Like it hits some primal parts of me. Eating a meal with people you work alongside is, depending on your interpretation, between a few hundred thousand and a few hundred million years old as a social act.
I doubt there are true contractors. Giants would not bother to do contractor paperwork with individuals. Most common is when "contractors" are employees of other bodyshop company and are paid as their regular employees, just leased to the client.
And if the we are talking about US - then their salary is much lower, simply because they cannot go anywhere else due to visa constraints.
Different treatment is a thing. But I couldn't imagine someone is ESA will say fruits and pizza are for employees only. Please leave the room while your coworkers eat.
You are missing the point that legal vs. socially acceptable are two different but very real factors that people care about.
You can’t legal away basic courtesy and explain away people’s anger at being treated like a lower social class.
Imagine if first class seats on a commercial flight were interspersed among regular class seats. First class passengers get more room, better food, more respect from attendants … right in front of people who don’t get those.
If the first class passengers get faster access to something basic like water, some people will go ballistic.
Sure people paid more for the nicer seats, but do you think that legal fact dispenses with the unhealthy social situation and bad feelings that would create?
ESA is one of the world’s leading space exploration organizations and one of the few that is international in scope, representing 22 member states. Contrary to a common misconception, ESA is not part of the European Union and not bound by European law. In fact, ESA is not bound by any real-world law, either local or national—it’s governed only by its 130-page Convention and a set of internal regulations.
This international status grants the ESA and its staff privileges that are far superior to those afforded to its bigger sister and role model, NASA, notably the ability to maintain any internal documents as confidential.
ESA were basically granted immunity, almost like a UN agency, and of course they are abusing it.
They also pay lower taxes than everyone else and so on. The best thing about ESA is that it sucks and doesn't actually accomplish much, so hopefully they stop this scam.
Again my complaint is not the end result isn't "impressive" in isolation it's that it's not impressive for the amount of time and money dumped into it compared to any other space program on earth. I said "for the money we pump into it".
Based on the data shared you're right and my assertions are wrong or at least overblown. To be honest I was thinking mostly compared to the Indian space program and their recent successes and I see that the data confirms that they have pumped less money and have (imo) done way more. But overall I'm wrong in the way I was positioning this, thanks for sharing, I did some more research on account of your comments.
No problem. After all, those programs are as much about maintaining knowledge, industry and capabilities in country as they are about specific missions.
To be fair, Austria had a pretty decent navy that used to give the Italians a run for their money. They probably did a bit of surfing here and there, too.
Eh, Scotland is in a similar position with a common-civil hybrid. The Channel Islands use a local customary Normon-derived legal system. And that's only in one European country!
UN geoscheme lists it as such if you want something concrete. (Though it also puts the UK in Northern Europe, and leaves out Italy & Spain & Portugal (Southern), which I didn't mean either.)
It's a funny term. In UK use it means something like 'mainland Europe but not Russia or some former Soviet states'. It's about the bits you think of and travel to, I suppose. Although that makes it sound obvious, which it isn't, because nobody means India when they say Asia, but it's at least as much in the public psyche as anywhere else in continental Asia.
I'd like to as in what ways is Europe great? From my narrow point of view, most if not all successful startups were founded outside Europe, most countries in Western Europe tend to be monolithic cultures where outsiders are made to feel like outsiders, and many European nations are socialist utopias (which means they take away a HUGE chunk of salary as tax).
(And I am asking this in a friendly tone, as a genuinely curious question, and not a combative one. These nuances get lost, so putting them down in words). Thanks.
It is great for living, for raising kids. For life.
Taxes in Europe are huge, but comparable with taxes in California. Just sum all federal, state, local taxes on the salary, property taxes, sales taxes, health insurance fee, college tuition fee. Don't forget to add 25% tips to that. Count also small vacation, maternity leave and sick leave.
And then compare for example with France.
And not to mention you wouldn't find anywhere in EU thousands of homeless junkies shitting on the streets.
I'm sorry, I don't think you have sufficient perspective on what middle class life is like in France to make this comment with any justification. French taxation is incredibly complex and heavy on the middle class. It is financially unfeasible for most middle class households to pass down their homes to their children due to the estate tax kicking on assets over 100,000 eur. There are many unhoused people spread across rural city centers and the outer banlieues of Paris. College is vastly more restricted in France and unavailable to the majority of the population. Social mobility is significantly constrained. Life grinds to a halt with some regularity due to general strikes. I am immensely grateful to have American citizenship and not have to raise my family in France.
It is financially unfeasible for most middle class households to pass down their homes to their children due to the estate tax kicking on assets over 100,000 eur.
That seems OK to me. Why should children who are lucky to be born into a stable middle class family have a large financial advantage over other children? To be clear, passing down an entire home tax free in a highly developed nation is a huge financial advantage. Literally: 1,000+ EURs per month, for life would be saved. Why do so many people on HN think this should be normal to allow? In my eyes, this is the path to Old World aristocracy. The purpose of inheritance taxes is to reduce this advantage.
I can guess what the reply/replies will be: "Oh, but housing is more expensive now. There is no choice but to use inheritance to give my children a head start." It would be better to ask why housing has gotten so out of control, not using inheritance to side step the issue.
You know, it's interesting. 100,000 eur really isn't a lot of money. I wager decent houses probably go double or triple that. Still, an entire life savings would most likely go into paying for that. Decades of labor in a country with small salaries and large taxes. 100k is nothing. Comparatively, to the rich that dominate the socio-economic and political landscape, it's probably a fun weekend vacation somewhere. I think that's what you dread: The rich that can afford to live lavishly. But you're harking over the barely haves, the not rich.
It's interesting.
A country with dwindling birthrates far below replacement levels perplexed by the fact that its people are refusing to father the next generation when they can't even provide a home for them. (It wouldn't even be tax free, by the way. Because the original proprietors bought and paid taxes on the house. What you're suggesting is double taxation :))
But it's okay. France has solved that problem: Make it illegal to take statistics on ethnic origins, let the poors of the world come flood your land, let them work for lower wages, and then act surprised when their culture is fundamentally incompatible with yours. Your streets are now unfamiliar. Unsafe. Dirty. They don't share your values of cleanliness and respect. Your freedom of expression. Don't worry. Their children won't be able to inherit their homes either. That's fine with them though: because they'll send their money back to their homelands where they can build villas with it, (or comfortably live in a ghetto squalor in Paris because it's still better than the conditions back home.)
> Why should children who are lucky to be born into a stable middle class family have a large financial advantage over other children
The reason why we have inheritances is people in power convinced each other that regular people will work harder throughout all their lives if they know they can give their children a better life. Meaning the economy is way better with some inheritance present than without inheritance.
Love is a powerful thing and while most people would agree with you that in theory they'd like all children to have the same opportunities, once their babies are born they will fight forever to give them the best conditions they can.
I agree with inheritance taxes, probably not 100%, but wanted to explain the perspective of people that want full untaxed inheritances.
> That seems OK to me. Why should children who are lucky to be born into a stable middle class family have a large financial advantage over other children?
Are you for real? Because it is not my or my children's fault other children don't have anything to inherit. This is how life works. You do whatever you can to get ahead of other through any means necessary to have a better future. You should not exepect the same outcome for people from different walks of life.
And just because not everyone can afford a house it is not my problem either.
> In my eyes, this is the path to Old World aristocracy. The purpose of inheritance taxes is to reduce this advantage.
So the world would be better if everyone was poor, right? The purpose of inheritance taxes is for the government to steal from your hard earned assets. Just because you're jealous of someone who inherits a big house or whatever will not make the world a better place.
> This is how life works. You do whatever you can to get ahead of other
Except its not how life works. Because we decided to make a law against it. You're trying to argue that the law is bad by... saying that it's not a natural law of the universe (no law is, murder is neutral on a cosmic scale)
> So the world would be better if everyone was poor, right
if you're arguing in this sort of bad faith its pointless discussing anything. Social mobility is demonstrably different across different nations, and policies do exist that actually affected social mobility. Social mobility correlates strongly with GDP. If you want a wealthy society, make it so hardworking people born into poor families can outcompete wealthy failsons
you replied to that by saying > You cannot have the same outcome
I explitly talked about outcome being dramatically different. Children of wealthy people who have no motivation to contribute anything to the world, learn no skills, and are lazy, should not end up on the same level as hardworking skilled children of poor parents. They should end much lower. Barriers to this include enormous inheritances, the housing market (prices driven up enormously by hoarding and inheritance), the cost of university education, vast disparities in the quality of education available in different areas, and nepotism in the jobs market.
These factors are very different in different countries. I forget the name of the stat but looking at the percentage of people born to bottom fifth income parents ending up as top fifth income earners themselves is quite telling. If I remember right there is a dramatic difference between similarly "developed" countries. I looked and couldn't find the original data I read but here [0] is similar, showing denmark children born to bottom quintile parents reach top quintile 14% of the time (perfect unachievable meritocracy would be 20%), wheras in the US its 8%.
It goes without saying, but the reason it is important to point out that it is different between countries is to argue against vibes based arguments of people who just throw their hands up and say "oh but woe is us this is the natural way of the world why rage against nature it will always be thus" simply because they think that is the case without any data whatsoever. This is literally table stakes for even discussing the problem.
> Children of wealthy people who have no motivation to contribute anything to the world, learn no skills, and are lazy, should not end up on the same level as hardworking skilled children of poor parents. They should end much lower. Barriers to this include enormous inheritances, the housing market (prices driven up enormously by hoarding and inheritance), the cost of university education, vast disparities in the quality of education available in different areas, and nepotism in the jobs market.
My gripe is with the above. Why would they try when they don't have to? Would you? And what does it matter to you that someone just spends money they inherited? It's like winning the lottery.
And what has someone's else wealth has to do with university costs?
I am not arguing it is morally wrong for a wealthy child to spend their wealth. I am talking about the whole of society. It's really very annoying of you to persist in strawmanning me in literally every coment. Sure I used negative words to describe an entirely hypothetical person, but the reality is that people exist on a range of productivity.
let me switch to a tangent. You seemed to be concerned with making a wealthy society, where at least some people have wealth, right?
In order to do that we have to ensure that its worthwhile for a talented person to work hard. When someone cannot become wealthy no matter how hard they work, why would they work to make anything in this world?
and so society suffers. The way to make people work to make things, is to reward them for doing that. This is an economic reality, and is demonstrable, there are many economics papers on the relationship between income inequality, gdp growth, and income mobility. Suffice to say, no matter who you are, its in your interest for there to be more mobility, and for inequality to be in a certain range (not too equal, for incentive, and not too unequal, it causes dramatic negative outcomes like crime, unrest, addiction, violence)
One aspect is the work you do and what it pays. If you're in the right industry, you can become wealthy (being in top 5-10% or less of the population) working a normal job.
On the other hand, if you're in a industry that pays very little, then no matter how much you work, you're not going to make it. And probably you're going to make if you decide to become an entrepreneur and get a piece of the pie. But it doesn't work for all and the only thing you can do is to switch industries if you can.
And these days I think the inequalities are greater due to rampant inflation that makes everyone poorer (considering only money earned) and though in percentage terms it is the same for everyone, it hits the lowest earners the most.
The thing is that in a free market I don't know how this can be solved.
Well the taxes pay to enforce property rights. It sort of becomes your problem if others don’t have a place to live and you won’t pay men with guns to keep them from taking your place to live.
I don't think we are on the brink of societal collapse :)
And it is just like now, I use a gun to shoot people that try to enter my house. What you're saying is that I should have people with guns in the house for the times that I'm not at home.
How is this different than today when your house gets robbed during the day?
Anecdotally to me USA even looks like it's collapsing every time I visit it. In the larger cities there are homeless everywere, and often literally next to luxury yachts and limousines. A lot of the infrastructure seems like it's literally gonna collapse, and lots of it really does. It's quite a cyberpunk vibe when compared to e.g. the nordic countries.
Of course there are similar problems in many european countries too. Especially England is quite bad w.r.t homelesness and infrastructure. But England is in many ways culturally closer to USA than most europe.
It is financially unfeasible for most middle class households to pass down their homes to their children due to the estate tax kicking on assets over 100,000 eur.
Inheritance tax for children caps at 20%. That's hardly "unfeasible".
> College is vastly more restricted in France and unavailable to the majority of the population.
French citizen here, I'm really surprised by what your saying as it doesn't match at all what I've seen about french higher education.
> French taxation is incredibly complex and heavy on the middle class
Yes and no. French taxation can be complex, but it's also mostly pre-filled and automatized. For most people, it's simply a matter of checking if the tax form is correct (and I've never had an incorrect one so far, as my employer automatically transmit my paycheck info to the government)
> Life grinds to a halt with some regularity due to general strikes
There are often disturbance due to strike, but "Life grinds to a halt" is also widely hyperbolic. The last real impactful strike I remember was the late 2019 month-long strike on parisian public transport, which was annoying (and was quickly followed by Covid lockdown)
But I also agree on many points you bring, there tend to be far less upward social mobility than in the USA (I'm always surprised by how fast people seem to be promoted in the USA), and generally more disposable income and opportunities. On the other hand, instead of having everyone thinking themselves as "temporary embarrassed millionaires", it's more accepted that even lower socio-economic classes should have decent working and living conditions, along with a better safety net.
On the plus side, apparently very few place in the USA are actually walk-able, even the malls seems to need a long drive instead of being part of living in a city.
There also aren't any food desert, with unprocessed food cheap, tasty[1] and widely available. Also, while there certainly are a fair share of drugs and homelessness, it's quite also quite safe[2].
[1] I know how smug that will sound, but all the echo I have is that fruits and vegetable in the USA taste very bland, and are far less nutrient-rich than they used to be a few generations ago. A friend who visited the USA was shocked about it, and half-seriously though he had Covid when he tried them, and he wasn't the only one.
[2] There are however pick-pocketing targeting tourists, especially asian, but a "hot" neighborhood in France is waaaay safer than a hot neighborhood in the USA.
Startups operating in Americas are founded in US. Rest of the world is different. For example, Lazada is huge in SEA and was created by Rocket Internet (DE). Delivery Hero (again, DE) is massive in SEA as well, the US ones like DoorDash have absolutely no presence. Uber isn't a thing anymore either.
In fact I see far more European and Asian companies operating globally nowadays, US startups are quite isolationist.
I had the same two-caste system enforced in European office of US company. Legally it was a local company with parent in US.
But anyway, "food is only for employees". Funny enough, even student who was there for 20 hours per week and did anything but work was allowed to eat.
It is a legal and cost thing. Said student is directly employed, the contractors have an employment contract with the agency. And those agencies are used to reduce costs, hence no sponsored, free or discounted food.
No, that's a rationalization. It is because psychopaths are running the place. I have never heard of an employer paying benefit tax on pizzas, and if they did, surely they can bill the consulting firm in some circle if that is the case.
Ok, but at Arm my red (intern) badge was no more 'demeaning' than my blue (permanent) badge. Not least because they only left my pocket when I needed to open a door...
(Colours from memory, I think that's right, they were certainly different anyway.)
Point is you can certainly learn not to treat contractors like employees, have badged access, etc., without having such hostility attached to it.
Edit: no! Red actually was a 'badge of shame', that was 'I forgot my badge today and had to get a spare from reception'. Anyway, it's beside the point exactly what was what. Different badges and access/treatment don't have to bleed into social treatment, they don't even have to be that visible.
This conversation isn't about the difference between intern and full time employee but rather the difference between contractor and full time employee.
Depends on when you interned! Before 2018 you would get a green badge as an intern, 2018 and onwards you got the same blue as everyone else, when they moved all the offices to GDAS.
The Microsoft problem was *independent* contractors. I.E. treating people as self-employed.
Normal contractors are employees of a temp firm. None of these issues apply there.
Footnote: I started my career as an IC, before I had family or kids. It was great. 32 hour work weeks and time (and the legal right) to do startups on the side. Ton of flexibility relative to a real job.
The microsoft lawsuit applied to the contractor staffing agencies, too. I'd google it for you, bute they had so many orange v-badges back in the day, that it has to be pretty easy to google.
Web search says that contrary to stereotypes, the problem was that they did NOT have contractor staffing agencies, and that as a result, they were not withholding taxes. This was resolved by bringing in a staffing agency.
A second problem was that they DID have ambiguous language in their employee handbooks, which meant that once temps were ruled employees, they became benefit-eligible, including in retroactively.
Yup, when I read the blog post, my immediate thought was, "Hey, this sounds just like Microsoft when I was there." There it was blue badge vs. non-blue badge.
All the other stuff, too –– wanting to innovate but finding everything so slow, lots of process, feeling very pampered, etc.
There's "contractors" and then there's "branded as outsider". The red hot iron kind of branding, not the marketing kind. Red badging is what you do when you view people as numbers in a spreadsheet instead of people.
Yea I've experienced this in capital one. Some smaller non tech companies are chill, where there is really no difference in how they treat contractors and employees.
Intel used to do this. I was a high school and college intern in the late 90s and it was this blue badge / green badge thing.
The funny thing is, there was another level which was how worn out your blue badge was. The longer you had been there, the closer the badge was to white.
If by "this" you meant a caste-like system, then my experience at Intel in 2010s was very different. Different people (contingent workers with green badges and others with blue badges) worked well enough together, and got well enough along (with one or two instances being the exception, not the rule). That's funny about the white badge. I am sure they could have gotten new ones, engineers have the funniest status symbols...
Wow, somehow I missed all that despite being a contractor for about half of 20+ years of working in this industry... Perhaps it is a USA thing? Although I worked for a couple of US companies remotely and I never noticed it.
I'm currently doing contracting for a Polish branch of a US company you would recognise a name of and the only difference between being a contractor (other than tax stuff of course) is that I can't fill security exception requests, and I get asked if I want to work during certain national holidays or not (employees get a day off per default, I have a choice).
I remember Google had something like contractors need to pay $1 to use the gym, meaning it wasn't free so it doesn't count as a benefit, but the amount was clearly not something that was material.
In the UK at least, if you are a contractor you are legally not an employee.
If you took any employee benefits, the tax man could retroactively classify you as an employee and demand a huge tax bill from you.
So many contractors would refuse any such benefits even if they were offered. Some didn't care of course and took them anyway, but they were potentially setting themselves up for a huge legal and tax problem.
One required by federal policy. Companies are legally bound, or at least incentivized to not risk lawsuits, to degrading temporary staff so as to distinguish between regular employees and contractors.
If the feds said you had to insult someone every time you bought printer ink, and then lots of people started getting insulted, I would lean towards blaming the feds for that outcome rather than blaming the people who buy printer ink.
Of course, it could separately be the case that people buy too much printer ink, and that we have good reasons for asking them to buy less. In which case our feelings about these new insults might be complicated. But if the goal of a regulation is "do less X", and the chosen mechanism is "you must insult other people when you do X", I'd call that questionable policy design.
Coming back from the metaphor, it seems more accurate to say that this regulatory situation with contractors wasn't explicitly designed at all, but rather "emerged" out of previous policies and court decisions. So maybe asking whether it was designed well or poorly is beside the point.
This isn't printer ink, this is somebody working for you full time who you don't want to call an employee because it's cheaper not to.
The idea is that if you treat somebody like an employee, they're an employee, and that idea was allowed to be hollowed out. If companies participate in certain shunning rituals they're allowed to keep those same cheap employees.
The purpose of the ruling wasn't to allow companies to operate in an identical way with identical costs, just meaner. It's not even a perverse incentive resulting from the ruling. It's that we've decided that only superficial, administrative features define an employment relationship, and so long as those rituals are adhered to, the fact that you work full time completely under the control of someone for years on end is not sufficient. There's no limit to the indirection, you may not have ever met your "actual" employer.
This is not an accidental outcome, this is an efficient outcome. It could be ended by government, but for the people who pay the people who work in government, it's ideal.
> The idea is that if you treat somebody like an employee, they're an employee, and that idea was allowed to be hollowed out.
Other way around. The status quo was that you could treat a contractor like an employee in everything but pay and benefits (like healthcare), and they were still a contractor.
A court ruling decreed that was no longer the case, so now for companies to have contractors at all they must draw a bright-line demarcation in perks between FTEs and TVCs. A line that is frequently dehumanizing, because dehumanizing is visible and easy to argue in a court of law.
Anyone who predicted any other outcome was naive, and those of us who want this silly pageant to end should be agitating for a law that functionally bans contracting.
Contractors are not normally cheaper than employees. All the overheads of an employee need to be paid for in the contract, plus profit, so if it comes out less than an employee, something isn't right.
Contractors offer flexibility. Contractors can be engaged and disengaged without labour law complications.
This is 100% on the companies who are working loopholes to avoid providing the same benefits and protections to some of their employees. The government would have zero issue with Google hiring everyone as an employee, but Google is choosing to twist the system to their own selfish benefit.
So... Google is legally required to treat contractors as second class citizens to afford them the privilege of being able to mistreat them and fire them at the drop of a pin.
We understand the """"purpose"""" of having contractors.
Not unlike how the GDPR resulted in banners everywhere, because the law stops short of banning contracting, companies have, of course, sought the optimal just-up-to-the-edge balance.
The biggest two reasons it matters (i.e. two biggest disincentives from just hiring contractors) are healthcare and quarterly reports. Healthcare provision is very expensive, even amortized across the employees in a company, and TVCs get no healthcare from the client company. And the client company can grow and shrink TVC contracts all day long without having to tell shareholders they went through a mass hiring cycle or a layoff cycle.
It's weird that we look down on people acting like massive pricks to save money in their personal lives. But once you wrap a business around them then most people don't seem to care.
As I grow older it bothers me more. Some classes of people have a facade where it's socially acceptable to be assholes, but other people, well, that's a moral failing. The US has a new religion, and it's worse than the last one.
“Full-time” is misleading noise here; the employee/contractor classification distinction doesn't hinge on term (temp/permanent) or time base (full/part time). Its true that some shops only bring contractors in for one side of one of those divides, but that's not what defines the status (or what defines who can be assigned each status.)
What they should be bound to is making "temporary-but-not-really" staff, just staff. But for that, strong unions are necessary, and US unions have been very week for decades (especially w.r.t. rate of unionization and centralization of power away from rank-and-file workers).
> the expectation was that if i sucked up enough ("demonstrated my value") they MIGHT make me a real boy, like some bizarre Velveteen Rabbit fetish game.
Google goes out of its way to emphasize that TVC "conversion" does not exist. You can interview, but you'll go through the same process as anybody else, they'll make sure you don't interview with anybody you know, and your achievements as TVC are discounted completely.
Conversion of Temps (but not Vendors or Contractors) did exist when I started working at Wing (the Alphabet drone delivery company) in 2018. We talked about it when I interviewed there.
Well, "interview" is overstating it. They needed some airspace data importers urgently and knew I could do it based on my past work for Google and my experience as a pilot. So we met for lunch, talked about the project, and that was that.
I actually thought the "temp" thing was a brilliant hack: we agreed on a decent rate (paid through Adecco), and if they liked my work and I liked working with them, I could convert to FTE at some point (and this was true at the time).
Then in August 2019 a memo came out that Temps were no longer eligible for FTE conversion. Even those who were hired with promises of that possibility.
And yes, the memo was exactly as you said. The people you'd worked with closely for the last year, who hired you because you were just the person they needed and you already were doing a great job for them? They couldn't vouch for you or communicate with the hiring panel at all.
It would be a grind through the standard Google interview process, as if you had no history with the team you are already working with and delivering for.
What kind of a fucked-up system is that?
The thing that stung the most was that the memo also explained in detail that Interns were and remained eligible for FTE conversion, without any kind of full interview round like a Temp would have to endure. The rationale: Interns were already employees.
But remember that is because these companies were exploiting the use of contractors to deny them employee protections.
True contractors won’t care: they work for themselves and have multiple clients anyway. But these "red" people are employees in all but name, so that the companies can save money and other protections. A small slip up by Google (Apple/FB/MS/tons of others) and these folks get the protection they deserve.
Yeah being an actual contractor/consultant should feel GOOD. You should not be married to a single company for too long. You should have a sense of freedom.
There should be a simple test that if a person is working at only one client for too long (3 mo?) then they are to be converted to an employee. There's no reason for these middleman employers to exist except to make people disposable to companies. If that's the case, then they should be cycled in and out with a higher frequency. Nobody should remain a "red badge" at Google for any significant length of time.
> True contractors won’t care: they work for themselves and have multiple clients anyway.
Some companies will even go as far as to prevent you from having multiple clients. Try asking anyone who contracts for Apple if they have any side work…
It's not illegal - they'd just have to provide them employee-like benefits which would be expensive. So it's just costly to treat contractors too well.
This is a case with contractors in all big companies. You are not a company employee. The expectation is that your employer will compensate you and take you out to lunch, etc, etc.
But otoh you don’t need to deal with performance appraisals, office politics and all the other bullshit. Do your work, take the money.
In such companies you are not truly a contractor, but employee of the bodyshop company which lease you to the client.
As the result you deal with politics in both companies: your employer and their client. And bodyshop has performance reviews as well.
Not really. A staffing co like randstadt won’t give you perf reviews etc. You just work through them for tax reason. You hardly even interact with your account manager.
That’s a strange accusation. I never said they were a body shop. They are a staffing company. I’ve known people who have worked through them. Have had good experiences.
I just said you could freelance through them. A lot of people do.
Oh, you absolutely do have performance reviews. Not in the sense that they determine your comp or whether you're promoted, because that will never change, but if you have poor performance they will talk to you about it and possibly cancel your contract. Seen this happen to several a contractor.
I worked as a contractor for a decade before, I didn't find it demeaning when employees didn't invite me to team lunches or special meetings. Just charge more for your services. Do you care when you get paid $200 per hr, if you are not invited to employee only meetings/lunches? Definitely not. The issue is about the right pay, not so much about demeaning/or that 'caste system' everyone invokes whenever someone sees unfairness.
Agreed 100%. Our (informal) manual for consultants used to say something like
"The cupcakes in the break room are not for you. Most people will not care if you take a cupcake, but somebody will, and we will hear about it. We give you money instead, and we will certainly bring you a cupcake if you want one."
No doubt there are some HR/legal folks wanting to avoid the liability of 'training' someone on something that goes badly. The workaround to that is to have the training in an auditorium and not keep attendance on who is in the room.
Why would they train you? It’s the responsibility of your parent company and for all they know you’ve already been thoroughly trained for active shootings in numerous other companies you’ve worked at.
There have been some recent court cases, sponsored by the unions, seeking to include full time benefits to subbies, but it's all a bit hand-wavy and, on the whole, people working with an ABN are not yet equivalent to full time employees.
Refer to the Casual Employment Information Statement (CEIS)[1] and due-to-be-released-on-6-December-2023 Fixed Term Contract Information Statement (FTCIS)[2].
1. Person directly employed on an ongoing basis. The employer pays all insurances, professional memberships and generally contributes to the professional development of the employee.
2. Person directly employed on a fixed-term basis. The employer must offer employment on an ongoing basis if the employee has been engaged for a certain period of time. The employer pays all insurances, professional memberships and generally responsible for professional development of the employee (but generally more limited than what is available to employees under option (1)).
3. Person contracted from a consulting firm, where the consulting firm directly employs the person on an ongoing basis. Once one client engagement ends, the consulting firm try to place the person with a different client as quickly as possible, and will keep paying the person during this process. The consulting firm pays all insurances, professional memberships and generally responsible for professional development of the employee.
4. Person contracted from a labour hire firm, where the labour hire firm directly employs the person on a _casual_ fixed-term basis. The labour hire firm may be required to offer employment on an ongoing basis if the employee has been engaged for a certain period of time with a regular pattern of work apparent. The employee doesn't have to accept (and it typically wouldn't be in the persons or labour hire firms interests to do so). Labour hire employment agreements will typically specify a base rate and then a casual loading on top, so it is clear what the remuneration changes would be if casual employment is changed to ongoing employment (including if this occurs retrospectively). This option is generally used by professionals in unregulated professions such as ICT. Labour hire firms pay insurance, taxes, etc and clients and/or employees generally provide facilities and tools of the trade.
5. Person directly contracted through that person's "personal services income" "business" (note: it's technically not considered a business). This option is generally used by professionals in highly regulated professions such as medicine. The person's "business" pays the person wages, insurances, professional memberships, and more commonly than (4) also facilities and tools of trade.
For total remuneration benefits from highest to lowest, it's generally (5) > (4) > (3) > (1) > (2). Ongoing employment of (1), (2) and (3) are generally detrimental versus casual employment of (4) and (5) because a person could be employed for 6 years and have accumulated months of personal/sick leave and be close to having long service leave payable, and be forced out of their employment arrangement for an external reason such as a bad boss, a spouse needing to relocate or a family member some distance away needing care. When the person leaves their employer, they lose all accumulated benefits and start from scratch with their new employer. Options (4) and (5) ensure the person is no worse off when changing employers as the person has been paid the benefits upfront on a continuous basis, rather than waiting for a day that may never occur to obtain those benefits.
For job security, there isn't much difference. Sometimes directly employed persons are made redundant before labour hire persons. Sometimes it's the opposite and labour hire persons are first to go. The main difference is whether a person gets 1 day notice and pay (casual employees of labour hire firms), 4 weeks notice and pay, or longer if a person has worked for the same employer for over a year. As employees have to change jobs every few years to grow a career and gain higher remuneration, the redundancy payouts for extended service are minimal compared to missed opportunity cost of not changing jobs. 1 day or 4 weeks notice and pay is negligible in the grand scheme of things, and most of the time labour hire employees would get much more than 1 day notice anyway to avoid the client gaining a bad reputation amongst the pool of labour hire employees.
For the order in which people progress through these options in a professional career, it's generally (2)|(1) > (3)|(4) > (5).
For overall employment preference of professionals, I'd suggest perhaps most to least preferred of (4) > (5) > (3) > (1) > (2). (4) has less overhead and distraction of (5) as one can focus on their profession without having to worry about frequent changes to tax laws, changes to insurance policies, etc. But eventually to grow further, a professional would be required to switch from option (4) to option (5) and then may need to switch focus away from their profession and towards business priorities such as hiring support staff, engaging other professionals such as accountants, lawyers, insurance brokers, etc. (3) generally provides better remuneration and career growth over (1) and (2) because client engagements are shorter and more varied. But sometimes (1) is a good way to get a foothold into an industry or move into more senior positions (particularly management roles), and may make more sense than options (3), (4) and (5).
I'm sorry to hear about that. I always went out of my way to make the contractors feel seen and important. I'd find their manager from the contracting company and write glowing reviews. I'd talk with them, treat them as equals, give them extra swag I got as an employee.
To "stick it to the man" directly by being kind and generous is perhaps the best possible task I can assign to myself.
IBM basically invented this particular kind of caste shaming in a business organization. Hardly their worst crime, and they're still allowed to operate.
I worked at a small company in London and got treated the same way: feeling left out, excluded.
It took me a bit of thinking before I realised it was actually being done for my own benefit, as I was a contractor there. Had they invited me to the office party etc. it would have contributed to me being seen as an employee, and losing the status of a contractor. They could not do this, I didn't want it. Once I realised that, I was fine with it, but it did hurt initially.
I must say it would have been a whole lot easier if the boss had simply bother to explain, but it doesn't really matter, he did actually have my best interests at heart (as well as his own of course!)
Referring to it as a caste system is pretty offensive tbh. It's a distinction between different types of highly paid tech worker ... not a system of oppression.
In the UK we have IR35 laws that say contractors must be distinct from employees in various ways.
The legislation is a shitshow.
It was supposed to be a way to protect people from zero-hours contracts but ended up being a way to extort more tax from businesses.
As a result, contractors face very odd rules to ensure that if HMRC (the UK tax body) comes knocking ... everything seems legit.
This means everything is policed from how you write emails to if you pay for the Christmas team meal.
I had the same issue when I was a contractor at Allstate in the investment department. They were frightened by the Quaker Oats decision where they paid folks as contractors who "forgot" to do their own tax withholding.
This was in the days of cubes, and contractors got the ones that were two folks per cube and there were other things.
Some of us did get hired and became "real". But the concerns that led to this kind of treatment were quite real.
I've worked as an employee and as a contractor in Silicon Valley (never at Google). While it was nice to be treated like an employee by some companies, my attitude was that it's just understood that as a contractor I'm not as much a member of the team as the employees are, and I'm the first to be let go if the money gets tight. Those were the tradeoffs of the flexibility I got. If contractors are the same as employees, why even have a distinction?
The way you should think about it is they didn’t want to spend the money on a full employee for that position. If they were forced to do that they just wouldn’t hire for that position. Or that position would be as competitive as any other job at Google and probably would not be the same people that are currently red badges.
There absolutely is a caste system in Silicon Valley based on how you can jump through credential and interview hoops. Which doesn’t necessarily correspond to job performance, which is frustrating for everyone. But nobody can figure out a better way to predict on the job performance. There are some emerging signals like open source contributions but not everyone uses that either because it can also be gamed.
Working alongside someone with significantly better employment conditions than you is disproportionately unpleasant, to the point that working under objectively worse conditions feels better.
I don't think that's a universal thing. I would rather make 10X working for someone who makes 10X (eg, very common situation in finance) vs making 1X sitting next to someone who also makes 1X (eg, DMV)
I get what you are talking about, but it's your choice to obsess more about what the other guy's getting rather than what you are.
So what about when two people have the same title, and tenure but one makes $50k more per year?
This is a similar situation and is happening at many companies. I know I make more than some peers that have higher job levels(and tenure in company) then I do.
> So what about when two people have the same title, and tenure but one makes $50k more per year?
Strangely enough that's a lot less viscerally unpleasant - perhaps because money is quite abstract (and you never actually see person A get a bigger pile than person B, whereas you notice immediately if there's a team pizza that person B isn't allowed to eat), perhaps because it's understandable that companies want to pay some people more and others less, whereas limiting who gets cheap perks feels like it's just nastiness.
LAWYERS and insane politicians are the reason why it is this way. Google is just working around all the BS which unfortunately leads to these bizarre behaviors.
I worked for one of the largest banks in Australia as a contractor. When I first joined, "we don't discriminate based on the employment type". The perm staff were wonderful in that regard. Then a new COO joined. He was a fucking sociopath. First we started getting locked out of various internal sites, needing to "reapply" for security reasons. Then they introduced the email badging that appended a big "(EXTERNAL!)" to your name in the address book. Then, if anyone attached anything to an email that included even one contractor as an addressee, they'd see a big WARNING! reminding them that they were potentially leaking the keys to the kingdom to us untrustworthy SOBs. Then in November a big rumour started going around that contractors were going to be "surprised" with a forced 6-week holiday (normal shutdown for contractors was 2 weeks over the break). I politely called out the COO directly on the internal Yammer, asking him to please put an end to the rumour mill and just confirm or deny whether it was true. I said the company would be within its rights to make that call but reminded him that "contractors are people too" and given the time of year, might want to know if their services weren't needed in January. I got a bunch of support from employees (and the managers I worked for) - perm and contractor alike. Many perms were embarassed and apologetic for this outcasting of contractors (way to increase morale Mr.COO). Anyway, within 24 hours, I was pulled out of a meeting and escorted out of the building. The entire Yammer forum was nuked from orbit (I still have a couple of screenshots) and I ended up in their non-existent "black book". I know this latter point because in the intervening years I would occasionally get pinged by recruiters for roles at that bank. I'd laugh and told them I was probably still in the black book and to contact so-and-so to confirm whether I'd be welcomed back. They were always surprised when they did so and were bluntly told that I was not welcome.
Since then I've been a perm at a couple of places were I had hiring responsibility and teams that included contractors and I ALWAYS made a point of treating them EXACTLY the same. I also never encountered another organisation that was as fucked in their treatment of contractors.
This is a direct consequence of the infamous Microsoft case. Contractors used to be treated much better, similar to employees. Then some Microsoft contractors sued for shares worth a considerable amount. Their argument was that they were "treated like employees", and therefore deserve the same things as employees. They won the lawsuit.
Now contractors have to be treated much worse because there is precedent for legal consequences if you treat them as well as your employees. It's just business, it's certainly not good for morale or productivity to create a class divide, but not creating that divide incurs serious liabilities.
My experience as a red badge person was very good. While it is true that I was unable to bring my wife to lunch and I didn’t get free massages, everything else was great.
I was hired by someone with some clout who enjoyed reading two books I had written. He would occasionally call me to talk, and then one time he invited me to work on his pet project at Google.
Some of the perks were amazing. I took an 8 hour class ‘end to end’ that I would have paid a lot of money to take and in one day I got to learn how to use all of the internal systems I would need for my project, plus lots of other interesting stuff. Pure joy, that one!
I totally enjoyed the food (this was in 2013) and I went to invited speaker talks (I made sure that I wasn’t counting this against my 8 hours a day). Getting to meet Molly Katzen (author or Moose Wood Cookbook, etc.) and having a long conversation with her was great. Ditto for Alexis Ohanian.
I also have a work eccentricity, that apparently was not a problem: I always like to start work around 6am, and then leave early. As far as I know, this was not a problem. I need at least two hours a day with no interruptions.
Anyway, if you get a chance to work at Google for a while as a contractor, go for it!
Ah yes, the TVCs. Nothing said "We're evil" more than the subclass of contractors. It is almost a trope in Sci-Fi literature that our characters in this Utopia world discover there are people who are essential to the utopia and yet aren't "part" of the utopia.
Of course in the stories our heroes rally the rest of the Utopians to the plight of this 'untouchable' class, the evil overlords are over thrown, and a more equal society for all is established. But that's why they call it fiction right?
Given that this article is written by a team that was acquired 8 years after I left, and yet experienced the same systemic problems that I explained in my exit interview would eventually kill Google as a company, I feel sad.
Kind of the reason I prefer mid-market tech companies. More likely to treat "contractors" as equals. The place I'm at now they're indistinguishable internally from regular employees, they're just paid by another company.
Effectively the fact that an employer treats a temporary employee "the same" as a regular one (i.e. by granting them the same perks) is construed by courts as evidence that they are not temporary.
So, if a company wants to hire temp/contractor employees, they just can't do this. It's not a "caste" thing, it's not about deliberate discrimination, it's not about keeping wages low or reducing overhead, and it's absolutely not unique to Google.
Blame the courts, basically. It was a terrible decision, for exactly this reason. Its effect is directly contra to its intent.
> If you worked with a TVC, you'd get training that felt like you were learning how to own a House Elf: "Remember, never give them clothing or they'll be free! And report them if they ever claim to work for Google."
Yes! That's exactly what happens. And it did, to Microsoft, and it was extremely expensive. So no one wants to see the same thing happen to them.
Again, to repeat: the desire in the suit (to prevent employers from inappropriately using temporary labor) was valid. The EFFECT of the suit is exactly the opposite: it's forced employers to performatively discriminate against temps in every way they can find as a way to prevent the kind of finding that hurt MSFT.
Thus, it's a bad ruling. I'm all for reform of contractor labor laws, but this decision broke things.
No one is forcing employers into performative hysterics, it's a reactionary choice by the corporate legal community. MSFT was guilty of what they were accused of. If they don't misclassify workers, they won't lose such a suit.
> No one is forcing employers into performative hysterics, it's a reactionary choice by the corporate legal community.
"The rest of the world is wrong, only I know the truth in this thread on a random web forum" is an unpersuasive frame to be arguing from. Corporate legal departments may be inflexible and hidebound, but they surely know this stuff better than you do.
No, this is the way it works. If you do what MS did and offer unrestricted perks to your temps, they'll sue you and you'll lose. Period.
What you're arguing amounts to "no one should hire temporary labor to work alongside salaried employees". And, OK, that's a position. But if that's what you want then you should make that case and not argue that somehow Viscaino doesn't exist, because it does.
Microsoft wasn’t offering unrestricted perks to contractors, they were treating them like second class employees, paying them less, not giving them benefits or allowing time off, dictating additional rules, excluding them, and avoiding existing labor, discrimination, and tax laws — exactly the same thing they (and every other big corporation) are still doing now — with a codified fiction in place that didn’t exist previously.
Microsoft didn’t lose the lawsuit, they won a settlement — and their lawyers and lobbyists made sure it would never happen again.
Most corporations have preferred vendors and the 50% plus savings in salary and benefits has a large kickback that finds its way back to the employer.
The real issue that was skirted around in the lawsuit was that Microsoft actually owned the vendors that supplied them with contractors.
They weren’t temps, read the case - average tenure, 11 years. And the entire thing started because the IRS said they were dodging payroll taxes, so the common law employees sued for what they were rightfully owed. MSFT acknowledged wrongdoing and settled the case.
They will only win if you are violating labor law. Why is that so hard for you to understand. If they hadn’t violated labor law they would have appealed and won. And here you are 26 years later trying the case again on a “silly web forum”.
I don't think that the parent isn't aware of that. I think the parent says that providing employee perks for your contractors _is_ violating the US labor law.
Do you really think that Google should not be blamed that in cutting costs they don't want to provide same benefits for people they lease?
If they had a will, they could easily force their vendors to provide same level of benefits.
This is happening exactly to cut costs, to keep reported headcount low. There will be no news if Google cut 50000 of such contractors, simply because they are not counted, not treated like a people. Just a resource, leased from another company.
No, it's got nothing to do with workplace protection or wages. The original suit was actually about participation in the stock purchase program (which in the mid-90's was extremely lucrative at MSFT!), something that no contractor would normally expect to get. But because the contractors got free food at the cafe (or whatever), they did. Or rather they got a settlement making up for the stock the courts said they should have been able to get.
Basically, the rule per Vizcaino is "Any benefit offered to salaried employees must be offered to temporary ones too unless you deliberately discriminate against them in all your other benefits not related to their job."
And yes, that's a stupid rule. But it's the rule, and it's universally enforced at every US employer large enough to have a legal department.
The game is that the contractors are supposedly not working for the company that they're actually working for. Anything that might break that illusion puts the company at risk of needing to treat them as the actual employees that they are.
By that logic it's always fine for companies to get around labour protections.
Yes, it would be better if they hired no-one. When your job conditions are beneath human dignity, you don't get to hire people for that job, even if that means your stock price doesn't grow quite as much and GDP is lower this year.
I don't think workers generally agree with you. Certainly in the tech world, it is hard to describe contract work as "beneath human dignity". For blue collar work, I would understand your point.
> Certainly in the tech world, it is hard to describe contract work as "beneath human dignity".
Realistically in the US the distinction is mainly about whether you have medical coverage. Plenty of people work with no or bad medical coverage because they are some combination of optimistic/greedy/desperate; to assess how humane that is you'd have to look at how they feel about it after getting diagnosed with something that they struggle to get decent treatment for because they weren't an employee.
It's not "fine" but it's extremely hard to get them to do things they are disincentivized to do. And most government attempts do not result in the desired behavior.
I remember before this decision, I worked somewhere where people could take longer to be promoted as a temp, maybe even 2 years. I don't know that this was exploitive, it was usually a mix of developing competency and department having budget. If someone left the company, usually someone got immediately promoted out of being a temp. If not that, it was dependent on department budget increase in the next fiscal year.
The legal change meant some roles like QA were put on a company switching treadmill.
no - the reason the issue went to court in the first place, was MSFT and Apple and others, not hiring (stock, health insurance) and then making contractors "prove themselves" a.k.a. extra overtime, demeaning social situations, lower perks etc
That's how it works with contractors in most large organisations. The other side of the coin is that they're usually rewarded better than employees are, on the basis that they can be fired at any time with no notice.
In practice that rarely happens, as higher-pay => better-retention => becomes-most-knowledgeable-person-over-time.
I've never seen a contractor have better salary/pay unless they're a fully independent subject matter expert and have no interest in being employed. I've hired a quite a few contractors and there is usually two cases, I need workers, or expertise that is highly limited.
Most contractors, not SME, are sourced from staffing agencies/partners. Sure, the resource cost is on par with a salaried worker, but typically the staffing company sourcing these people are going to take a huge chunk on that contract, at least 1/3. So yes, the resource/person is 280K on paper, but it's extremely rare they actually get paid that. The staffing agencies will provide benefits, but they're not even close to what in house staff are getting.
It also becomes nearly impossible to hire a contractor from partners in cases like this because you have to buy out the resource on the contract which is almost a non-starter because these fees can easily be 6 figures per head.
The staffing agencies benefits are always subpar and more expensive.
And you’re right about the difference between “staff augmentation” contractors pay and SMEs. I just went into detail in a sibling reply.
But to add on, the company I ended up being a tech lead at with a full time position. I came in at $65/hour. I only took the job because I saw a chance to eventually wiggle my way into a tech lead role and I wanted to be on the ground floor of a green field project. I ended up working so much overtime - and getting paid for it - I made out pretty well compared to the local market. I got on my wife’s health insurance.
I also mentioned that now that I am a SME on a niche but growing AWS service [1], I am able to charge $135 an hour for a side project and that’s a discount.
[1] I beta tested the APIs while working at AWS and I was a major contributor on a popular open source official “AWS Solution” that’s built on top of it.
Not necessarily. I was a tech lead where I could only hire contractors. The run of the mill CRUD staff augmentation contractors were making about $65 and the contracting company was billing $100 a hour for them with no health care benefits, no PTO, no 401K match.
On the other hand, the “cloud consultants”, who were just old school operations folks who only knew how to do lift and shifts and make everything more expensive were billing $200 an hour. It was a small shop owned by the partners.
Long story short, I left there went to a startup for two years to get real world AWS experience, got hired at AWS in the ProServe department (full time job) and when I got Amazoned three years later (two months ago), I was able to negotiate a side contract with my former CTO for $135/hour and even that was low. I did it because I found the project interesting and I consider my former CTO a friend.
FWIW: I did get a full time job within three weeks.
I’m don’t think it’s true at companies like Google that contractors get paid better. My impression was they get a similar salary but no equity and worse benefits. I’m assuming we’re talking about the TVCs who basically act like ordinary contributors on a team. Not some specialist consultant, I don’t know about them.
Most large orgs don't have the perks of Goog, Meta. Amazon and Cisco don't have free food, massages, etc. so it doesn't matter contractor vs. fulltime.
It very much matters - paid time off, benefits, employer paid FICA taxes (if you are 1099). All that is just money and if you are an SME you can negotiate for a high enough hourly rate to make up the difference.
But if you are just doing staff augmentation, probably not.
I don't understand the concern. If a company has a choice of hiring more people with more elasticity, or not hire as much or at all, is that somehow a terrible thing to do?
Half of the things that feel like Google wanted to eject them was to satisfy IRS (e.g. paid rides on GBus), not because Google voluntarily wanted to treat them as such.
FWIW, most red badgers I knew were of non-engineering job functions and for them working at Google offices was a huge plus compared to their best alternative, not by a little margin, but a lot.
If I were to speak from the woke mentality, the author of the blog, who got sweet money through acquihire of a product no one ever heard of and probably never passed Google interview bar would be the bourgeois class at Google and every regular-E-badger with a PhD who works on ads for next to nothing, comparatively, to pay him is a third-class nobody. Gimmie. A. Break.
While FB had the same badge color for TVCs and FTEs, everything else was exactly the same. I later saw the red/white badge dichotomy at Google and thought that the explicitness of it was a bit better.
Cisco has/had an outrageously large contractor contingent (this may be different between Business Units). That's a huge cultural difference between Cisco the tech giant sets
Whatever fraction it is at Google, I'm willing to bet Cisco's is significantly larger, especially on "core-business" teams whose work is mentioned in analyst calls
The "TVC issue" is the flip side of Google etc culture and perks. When a company takes great care of its people, contractors seem unfortunate in contrast (since they are someone else's employees, there's no expectation of long-term investment from either side, etc.)
On the reverse of that is a company that's mediocre to work for. The contractors might seem like the lucky ones in that scenario (hence, resentful language like "highly paid contractor" etc.) In fact, the same TVC might be the "highly paid contractor" at the same pay and treatment somewhere else.
Other posters already explained why it's like this - mainly because they are employees of another company, with a much lower barrier to hiring (and firing), a different liability profile, etc.
> And report them if they ever claim to work for Google.
Google is already too big at this point, I'm talking about producing anything that would have a real impact in the medium to long term.
In a way, that's good, the last thing we really want is for really talented people to be able to do meaningful work at Google's scale and given Google's current incentives, on the other hand you have to feel for those talented people and for their wasted intellectual potential.
> If you asked about it, the manager would say "we can't give Jim things directly because that might be like compensation and they'd be like an employee."
While extending it to things as small as a team lunch is going a bit far, it's understandable that they don't want to open up a slippery slope of it looking too much like an employment relationship. In many European countries that can result in false self-employment and get both the company and the contractor in legal trouble.
> that might be like compensation and they'd be like an employee
Blame government regulations in this case, probably? It seems implausibly evil that they would be that anal about things just to preserve the in-group club status. But, if it's about employee vs contractor distinction for regulations, it makes total sense (well, not at a global/system level, but the behavior in isolation).
