My understanding--and I'm an engineer, not a lawyer--is that many companies segregate contractors as a response to labor laws. See http://en.wikipedia.org/wiki/

My understanding--and I'm an engineer, not a lawyer--is that many companies segregate contractors as a response to labor laws. See http://en.wikipedia.org/wiki/Permatemp http://en.wikipedia.org/wiki/Permatemp. The important point here is that if temporary employees are working alongside full timers doing very similar work for long periods of time, the employer (Google, not the agency) runs the risk of a suit like http://en.wikipedia.org/wiki/Permatemp#Vizcaino_v._Microsoft http://en.wikipedia.org/wiki/Permatemp#Vizcaino_v._Microsoft. Microsoft now (and I suspect this lies in part behind Google's various segregations of different classes of employees) makes an effort to restrict contractor access to various full-timer activities (like ski trips and such, as the author complains) and to ensure that contractors don't do full-timer work. So this isn't some sort of evil conspiracy; it's an honest attempt to comply with US labor laws.