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I work for a large company, and it frustrates me that they rely so heavily on contractors for campus support positions. At the same time, the incentives are po
by bsimpson 9y ago
I work for a large company, and it frustrates me that they rely so heavily on contractors for campus support positions. At the same time, the incentives are pointed that way. It's easier to hire vendors to manage non-core services (food, massage, etc.) than to develop those processes in-house. At the same time, it's cheaper to not have to provide equal benefits to vendor employees.
The lack of access to on-site medical or to cultural events like Take Your Kid To Work Day is presumably to draw a clear line between Vendor and Employee. If a group of vendor workers file a class action suit to be reclassified as employees (with backpay/benefits), a company wants to be able to say "Nope, they were vendors. Look at all the ways we made the distinction clear." If they're treated as employees in every way except the payer of their checks, it's a lot harder to justify why they were classified as vendors and received lesser benefits because of it.
I was a temp at another large company before moving to a full-time role at my current one. My contract was capped at 1 year, because without the cap, there was a perceived risk that I could seek to be retroactively classified as an employee and entitled to the benefits I didn't receive as a vendor.
- pacaro 9y agoYeah, this happened at Microsoft. Back in the day there wasn't such a clear line between contractors and FTEs. The lawsuit did a lot of damage in both directions. It's not clear who benefitted other than the attorneys. Also, if you make these roles direct employees, then you can get into an awkward position wrt 401K contributions, if the delta between your highest and lowest payed employees is too great. My understanding is that this is why Amazon caps salary at 160/185k
- jazzyk 9y ago>The lawsuit did a lot of damage in both directions. It's not clear who benefitted other than the attorneys. That lawsuit single-handedly created an additional layer of intermediaries (whole industry, really), which eats up ~30% of consulting revenue and provides close to zero value.
- bsimpson 9y agoAt the large company I contracted for, I negotiated my rate directly with the company. Then, they had their vendor manager hire me, and agreed to pay them my rate + their markup as an hourly wage for my services. I worked directly for the large company, but was an employee of a vendor whose sole purpose was to manage that company's contractors. It was quite bizarre.
- 5thaccount 9y agoThink how much regulatory red tape there must be for that to be a better way to do things! There is the point at which laws designed to protect people end up hurting them. The Seattle minimum wage experiment is a good example: http://marginalrevolution.com/marginalrevolution/2017/06/seattle-minimum-wage-study.html http://marginalrevolution.com/marginalrevolution/2017/06/sea... (https://evans.uw.edu/sites/default/files/NBER%20Working%20Paper.pdf https://evans.uw.edu/sites/default/files/NBER%20Working%20Pa...) > – The numbers of hours worked by low-wage workers fell by 3.5 million hours per quarter. This was reflected both in thousands of job losses and reductions in hours worked by those who retained their jobs. > > – The losses were so dramatic that this increase “reduced income paid to low-wage employees of single-location Seattle businesses by roughly $120 million on an annual basis.” On average, low-wage workers lost $125 per month. The minimum wage has always been a lousy income transfer program, but at this level you’d come out ahead just setting a hundred million dollars a year on fire. And that’s before we get into who kept vs lost their jobs. When laws with one goal achieve the exact opposite, we need to rethink the laws. Unfortunately, pyrrhic victories are rather common in politics.