I understand just fine. There has to be demand for your services. If 8 people will take the job without severance you probably won't get severance. So maybe if you're going to jump ship and there's talk about getting sued, maybe just maybe try to work that in between yourselves so there isn't a whole slew of you getting fucked over.
We call that a union when it's actually organized.
Lord if could make a union happen I would do it in a heartbeat.
These people would rather have 40% of their bill rate go to the contracting company that's actively trying to screw them than see a dime go to union dues that is at least, on the surface, there to help them. Not to mention there still isn't really such a thing as an IT worker's union, so anyone we roped into representing us wouldn't really know how to do it correctly.
I've thought about this a lot.
This is america. Unions are dead.
life's a game that you're bound to lose / like using a hammer to pound in screws
fuck up once and you break your thumb / if you're happy at all then you're god damn dumb
that's right we're on a fucked up cruise / God is dead but at least we have booze
bad things happen, no one knows why / the sun burns out and everyone dies
It also seems like your situation is unique in that you're basically working for a glorified version of robert half-your-paycheck. I've never seen contractors work for a Company where they in return go work for another company full time. It's always, I'm at Company A's office, and get called out to fix something at Company B or C or D or E or whoever needs it.
not a doctor, not a lawyer, examples I use may not be fully researched so don't take out of context plz, don't @ me
It also seems like your situation is unique in that you're basically working for a glorified version of robert half-your-paycheck. I've never seen contractors work for a Company where they in return go work for another company full time. It's always, I'm at Company A's office, and get called out to fix something at Company B or C or D or E or whoever needs it.
This is super common in the Seattle area. All the bigwig companies here do it.
life's a game that you're bound to lose / like using a hammer to pound in screws
fuck up once and you break your thumb / if you're happy at all then you're god damn dumb
that's right we're on a fucked up cruise / God is dead but at least we have booze
bad things happen, no one knows why / the sun burns out and everyone dies
At least I have enough experience now that my next job will not be as a contractor. Lord knows I've been looking.
life's a game that you're bound to lose / like using a hammer to pound in screws
fuck up once and you break your thumb / if you're happy at all then you're god damn dumb
that's right we're on a fucked up cruise / God is dead but at least we have booze
bad things happen, no one knows why / the sun burns out and everyone dies
You should up the ante because even with Ch11, companies have been known to pull that "sorry we have no money" shit. I think borders originally was Ch11 before they went bellyup.
not a doctor, not a lawyer, examples I use may not be fully researched so don't take out of context plz, don't @ me
Could always countersue alleging fraud. Fraud judgments jump to the head of the line in bankruptcy cases. (Except those holding securities perhaps, been a while since I did anything with bankruptcy.)
"Simple, real stupidity beats artificial intelligence every time." -Mustrum Ridcully in Terry Pratchett's Hogfather p. 142 (HarperPrism 1996)
I'm pretty sure unpaid employees are already actually front of the line in bankos?
Like file that shit though the DoL.
life's a game that you're bound to lose / like using a hammer to pound in screws
fuck up once and you break your thumb / if you're happy at all then you're god damn dumb
that's right we're on a fucked up cruise / God is dead but at least we have booze
bad things happen, no one knows why / the sun burns out and everyone dies
Nope, they aren't. It's not considered "secured" debt. Which is bonkers to me, employees should get first dibs before anyone.
Any state where they are considered secured, they're after all the creditors since their debt is the "newest". With a bankruptcy that probably means there's nothing left to be liquidated to pay them either.
This differs state to state though.
not a doctor, not a lawyer, examples I use may not be fully researched so don't take out of context plz, don't @ me
Hmm the first $4k in unpaid wages gets priority of some kind in WA state, though I can't pin down exactly what that means.
Whatevs.
life's a game that you're bound to lose / like using a hammer to pound in screws
fuck up once and you break your thumb / if you're happy at all then you're god damn dumb
that's right we're on a fucked up cruise / God is dead but at least we have booze
bad things happen, no one knows why / the sun burns out and everyone dies
It also seems like your situation is unique in that you're basically working for a glorified version of robert half-your-paycheck. I've never seen contractors work for a Company where they in return go work for another company full time. It's always, I'm at Company A's office, and get called out to fix something at Company B or C or D or E or whoever needs it.
This is super common in the Seattle area. All the bigwig companies here do it.
Microsoft's actually moving away from it, but in a way that totally fucks over all the contractors that are currently working there. The new policy that they're phasing in with the layoffs is that no contractor term can last longer than 18 months (with most being only 12 months long), and once your term expires you're completely blocked from any building/server access for 6 months, which pretty much ensures that the revolving door contractor system will fall apart out there.
It also seems like your situation is unique in that you're basically working for a glorified version of robert half-your-paycheck. I've never seen contractors work for a Company where they in return go work for another company full time. It's always, I'm at Company A's office, and get called out to fix something at Company B or C or D or E or whoever needs it.
This is super common in the Seattle area. All the bigwig companies here do it.
Microsoft's actually moving away from it, but in a way that totally fucks over all the contractors that are currently working there. The new policy that they're phasing in with the layoffs is that no contractor term can last longer than 18 months (with most being only 12 months long), and once your term expires you're completely blocked from any building/server access for 6 months, which pretty much ensures that the revolving door contractor system will fall apart out there.
This did this once before (with a 9 on 3 off schedule), then created a new class of contractors that could work year round.
Honestly I would be surprised if they don't do the same thing again.
life's a game that you're bound to lose / like using a hammer to pound in screws
fuck up once and you break your thumb / if you're happy at all then you're god damn dumb
that's right we're on a fucked up cruise / God is dead but at least we have booze
bad things happen, no one knows why / the sun burns out and everyone dies
It also seems like your situation is unique in that you're basically working for a glorified version of robert half-your-paycheck. I've never seen contractors work for a Company where they in return go work for another company full time. It's always, I'm at Company A's office, and get called out to fix something at Company B or C or D or E or whoever needs it.
This is super common in the Seattle area. All the bigwig companies here do it.
Microsoft's actually moving away from it, but in a way that totally fucks over all the contractors that are currently working there. The new policy that they're phasing in with the layoffs is that no contractor term can last longer than 18 months (with most being only 12 months long), and once your term expires you're completely blocked from any building/server access for 6 months, which pretty much ensures that the revolving door contractor system will fall apart out there.
This did this once before (with a 9 on 3 off schedule), then created a new class of contractors that could work year round.
Honestly I would be surprised if they don't do the same thing again.
Yeah, it'll definitely be a test to see if Nadella can stick to his guns on this one.
It also seems like your situation is unique in that you're basically working for a glorified version of robert half-your-paycheck. I've never seen contractors work for a Company where they in return go work for another company full time. It's always, I'm at Company A's office, and get called out to fix something at Company B or C or D or E or whoever needs it.
This is super common in the Seattle area. All the bigwig companies here do it.
Microsoft's actually moving away from it, but in a way that totally fucks over all the contractors that are currently working there. The new policy that they're phasing in with the layoffs is that no contractor term can last longer than 18 months (with most being only 12 months long), and once your term expires you're completely blocked from any building/server access for 6 months, which pretty much ensures that the revolving door contractor system will fall apart out there.
This did this once before (with a 9 on 3 off schedule), then created a new class of contractors that could work year round.
Honestly I would be surprised if they don't do the same thing again.
Apparently this is in response to lawmakers saying "If you work X amount of months you're no longer a contractor."
So they had them work X amount of months - a day. Then "fired them", then rehired them, then worked them X amount of months - a day.
So the lawmakers went "Well that's dumb, the purpose of this law was to prevent contract workers from being assumed to be an employee with no benefits of actually being an employee, so, that time period must be Y % of X."
So the companies hire people to fit that new amount of math.
You'd figure the amount of money the save doing this would be completely shadowed by the fact that you basically have to have lawyers, HR people, and all other support people watching all this shit to make sure no one goes over their work period, so you're essentially paying 20 some odd people their salaries because you don't want to pay one in benefits and a slightly higher salary than what they're getting now.
Basically the law should read "Listen if you're hiring people to do the work that an employee would do for more than a few days, we're going to hit you with fines that are greater than the average salary for people with senior level experience and paying them the difference, stop acting like dingleberries. Yes, that means you too MoneybagSoft."
bowen on
not a doctor, not a lawyer, examples I use may not be fully researched so don't take out of context plz, don't @ me
It also seems like your situation is unique in that you're basically working for a glorified version of robert half-your-paycheck. I've never seen contractors work for a Company where they in return go work for another company full time. It's always, I'm at Company A's office, and get called out to fix something at Company B or C or D or E or whoever needs it.
This is super common in the Seattle area. All the bigwig companies here do it.
Microsoft's actually moving away from it, but in a way that totally fucks over all the contractors that are currently working there. The new policy that they're phasing in with the layoffs is that no contractor term can last longer than 18 months (with most being only 12 months long), and once your term expires you're completely blocked from any building/server access for 6 months, which pretty much ensures that the revolving door contractor system will fall apart out there.
This did this once before (with a 9 on 3 off schedule), then created a new class of contractors that could work year round.
Honestly I would be surprised if they don't do the same thing again.
Yeah, it'll definitely be a test to see if Nadella can stick to his guns on this one.
I know a lot of people that work there, and really the only way this is going to work is if they plan on hiring the majority of the current year-round contractors.
Which I just don't see happening.
life's a game that you're bound to lose / like using a hammer to pound in screws
fuck up once and you break your thumb / if you're happy at all then you're god damn dumb
that's right we're on a fucked up cruise / God is dead but at least we have booze
bad things happen, no one knows why / the sun burns out and everyone dies
It also seems like your situation is unique in that you're basically working for a glorified version of robert half-your-paycheck. I've never seen contractors work for a Company where they in return go work for another company full time. It's always, I'm at Company A's office, and get called out to fix something at Company B or C or D or E or whoever needs it.
This is super common in the Seattle area. All the bigwig companies here do it.
Microsoft's actually moving away from it, but in a way that totally fucks over all the contractors that are currently working there. The new policy that they're phasing in with the layoffs is that no contractor term can last longer than 18 months (with most being only 12 months long), and once your term expires you're completely blocked from any building/server access for 6 months, which pretty much ensures that the revolving door contractor system will fall apart out there.
This did this once before (with a 9 on 3 off schedule), then created a new class of contractors that could work year round.
Honestly I would be surprised if they don't do the same thing again.
Yeah, it'll definitely be a test to see if Nadella can stick to his guns on this one.
I know a lot of people that work there, and really the only way this is going to work is if they plan on hiring the majority of the current year-round contractors.
Which I just don't see happening.
Why not? They basically already are. And they're paying the other company profit on top of it.
not a doctor, not a lawyer, examples I use may not be fully researched so don't take out of context plz, don't @ me
It also seems like your situation is unique in that you're basically working for a glorified version of robert half-your-paycheck. I've never seen contractors work for a Company where they in return go work for another company full time. It's always, I'm at Company A's office, and get called out to fix something at Company B or C or D or E or whoever needs it.
This is super common in the Seattle area. All the bigwig companies here do it.
Microsoft's actually moving away from it, but in a way that totally fucks over all the contractors that are currently working there. The new policy that they're phasing in with the layoffs is that no contractor term can last longer than 18 months (with most being only 12 months long), and once your term expires you're completely blocked from any building/server access for 6 months, which pretty much ensures that the revolving door contractor system will fall apart out there.
This did this once before (with a 9 on 3 off schedule), then created a new class of contractors that could work year round.
Honestly I would be surprised if they don't do the same thing again.
Yeah, it'll definitely be a test to see if Nadella can stick to his guns on this one.
I know a lot of people that work there, and really the only way this is going to work is if they plan on hiring the majority of the current year-round contractors.
Which I just don't see happening.
Why not? They basically already are. And they're paying the other company profit on top of it.
The culture's too messed up. The contractors are all second-class citizens who end up doing most of the work. You elevate them all up to FTEs and a bunch of the oldtimers are going to be pissed off.
life's a game that you're bound to lose / like using a hammer to pound in screws
fuck up once and you break your thumb / if you're happy at all then you're god damn dumb
that's right we're on a fucked up cruise / God is dead but at least we have booze
bad things happen, no one knows why / the sun burns out and everyone dies
Microsoft supposedly has almost as many external vendors as they do FTEs. They currently directly employ somewhere around 128k people (last year they only employed 100k, so you can figure a lot of those jobs are a result of the Nokia acquisition).
Of course, a lot of those contractors are going to be doing shit like building security, landscaping, driving their commuter buses, running reception desks, etc.
The Microsoft weird contracting rules were due to a stock options lawsuit.
Essentially, a dozen years ago, you had long time contractors, we're talking like 10 year contractors here, who never benefited from Microsoft's meteoric stock option gains.
Those folks sued and won like a bazillion stock options, quite a big expense for a company with a high flying stock. An order of magnitude more expensive than lawyers and HR and stuff like that, especially since large companies have teams of lawyers and HR on payroll already.
Why not just make them employees? I don't see the problem here.
Looks better on the balance sheet. Contractors go under a different column. And you can totally just fire them at any time if things get dicey, they're obviously non-essential staff!
Bonus side effects:
You can now say you provide awesome bennies to all your employess without having to actually provide those bennies to all your employees.
Prevents unions from forming.
Prevents you from having to give people silly things like raises.
Aioua on
life's a game that you're bound to lose / like using a hammer to pound in screws
fuck up once and you break your thumb / if you're happy at all then you're god damn dumb
that's right we're on a fucked up cruise / God is dead but at least we have booze
bad things happen, no one knows why / the sun burns out and everyone dies
Seattle is something out of dystopian future or something.
H1Bs as real employees and shitty contractor companies for all the rest of the American workers needed to clean up after the H1Bs.
Hey now, we've got a lot of H1Bs and as far as I can tell they are on average more effective and have a better work ethic than our native employees. That could be because they're basically indentured servants though. Our guys we hire onsite in India, that's a different story; if they're still around in 6 months they probably don't suck balls, but there's a lot of churn.
Easily paying 25% on top of what you'd pay for bennies and wages to cover overheard in the contracting company, though.
The math would work considerably in their favor if the people were real employees.
If, and only if, employees do actual work.
No he's right there, it has to do with business expenses vs payroll or some other bookkeeping voodoo like that.
Contractors are waaaay more "sensible" from a business perspective. It also apparently (I don't know all the logistics) costs more to on-board and fire a full time employee than it does to empty the chamber and reload on contractors. Generally has to do with the benefits and whatnot. With a contractor you're just cutting a check, with an FTE you're getting them on your insurance and all that.
0
Options
Donovan PuppyfuckerA dagger in the dark isworth a thousand swords in the morningRegistered Userregular
I understand just fine. There has to be demand for your services. If 8 people will take the job without severance you probably won't get severance. So maybe if you're going to jump ship and there's talk about getting sued, maybe just maybe try to work that in between yourselves so there isn't a whole slew of you getting fucked over.
We call that a union when it's actually organized.
Unions?!? You dirty commie bastard, unions are evil and the scourge of the Earth and they are all too busy screwing over their members and counting their money to contribute anything to the world!
Easily paying 25% on top of what you'd pay for bennies and wages to cover overheard in the contracting company, though.
The math would work considerably in their favor if the people were real employees.
If, and only if, employees do actual work.
No he's right there, it has to do with business expenses vs payroll or some other bookkeeping voodoo like that.
Contractors are waaaay more "sensible" from a business perspective. It also apparently (I don't know all the logistics) costs more to on-board and fire a full time employee than it does to empty the chamber and reload on contractors. Generally has to do with the benefits and whatnot. With a contractor you're just cutting a check, with an FTE you're getting them on your insurance and all that.
Yeah but the company you hire from has to pay all that stuff. So you're paying for it through the company, plus their profit on top of it. You're effectively already paying for the benefits, the payroll taxes, everything. And you're paying someone else to be their keeper.
The only thing you gain is the ability to fire them. Which would be offset by having to retrain people every X months. Your business will take a hit from that and the profit where you'd probably be better off hiring your own crew of people, and getting ones you like so the issue with "firing" people isn't really an issue.
not a doctor, not a lawyer, examples I use may not be fully researched so don't take out of context plz, don't @ me
life's a game that you're bound to lose / like using a hammer to pound in screws
fuck up once and you break your thumb / if you're happy at all then you're god damn dumb
that's right we're on a fucked up cruise / God is dead but at least we have booze
bad things happen, no one knows why / the sun burns out and everyone dies
Easily paying 25% on top of what you'd pay for bennies and wages to cover overheard in the contracting company, though.
The math would work considerably in their favor if the people were real employees.
If, and only if, employees do actual work.
No he's right there, it has to do with business expenses vs payroll or some other bookkeeping voodoo like that.
Contractors are waaaay more "sensible" from a business perspective. It also apparently (I don't know all the logistics) costs more to on-board and fire a full time employee than it does to empty the chamber and reload on contractors. Generally has to do with the benefits and whatnot. With a contractor you're just cutting a check, with an FTE you're getting them on your insurance and all that.
Yeah but the company you hire from has to pay all that stuff. So you're paying for it through the company, plus their profit on top of it. You're effectively already paying for the benefits, the payroll taxes, everything. And you're paying someone else to be their keeper.
The only thing you gain is the ability to fire them. Which would be offset by having to retrain people every X months. Your business will take a hit from that and the profit where you'd probably be better off hiring your own crew of people, and getting ones you like so the issue with "firing" people isn't really an issue.
It's not just about how much more or less it costs, it's about how they write off the expenses. In essence hiring contractors becomes a tax dodge instead of a payroll burden. Businesses be greedy, if it legitimately cost them money in the long run, they wouldn't. If you can contract half your staff, that means you can essentially write off half your payroll as a business expense.
You can write off a lot of employee stuff. I'm fairly positive payroll and health insurance are one of the things that are able to be written off since it's a business expense.
not a doctor, not a lawyer, examples I use may not be fully researched so don't take out of context plz, don't @ me
I did a little scratching around and found a few other things as well. You don't pay contractors for vacation time, obviously. You're not on the hook for withholding their taxes, you just cut the check to the contracting company. You have reduced liability for covering them for things like worker's comp. All of that shit they would go to their company instead of to you for. So, it's partially which budget/tax bucket you put their labor expenses in, and partially the reduced amount of workload for on-boarding them or covering them.
Regardless, being a contractor sucks ass and should be avoided whenever possible.
In general you have to pay the contracting company to do all that for you, though.
The only time you save money is when the contracting company is sufficiently large that they save so much money from economies of scale that they can pay for all that and take a healthy cut for themselves and still charge less than it would cost you.
Really contractors are just a symptom of the super short-term mentality that businesses have been rocking for the last 20-30 years.
In the long run it's more profitable to have actual employees, but good luck teaching shareholders that.
life's a game that you're bound to lose / like using a hammer to pound in screws
fuck up once and you break your thumb / if you're happy at all then you're god damn dumb
that's right we're on a fucked up cruise / God is dead but at least we have booze
bad things happen, no one knows why / the sun burns out and everyone dies
In general you have to pay the contracting company to do all that for you, though.
The only time you save money is when the contracting company is sufficiently large that they save so much money from economies of scale that they can pay for all that and take a healthy cut for themselves and still charge less than it would cost you.
Yup you're paying for all of that stuff either way. And like I said, payroll taxes are usually deductible since it's a "regular business expense." Holiday pay isn't required by law, so... but yeah you're still paying for that.
Oh but then you go, "Bowen, but with a contracting company, when the IT guy is on vacation I still have an IT guy, but I only paid for 1!"
No, you didn't. You paid for the profit of the company and for the overhead to have a second person, of course, spread out over the course of the contract. You also are still paying for vacation time, health insurance, 401k compensation, payroll tax and profits for the company you're using.
There are two situations where this will work in the company's favor:
You're a tiny ass company and don't have the resources to hire a full time person, but also don't have the need for a full time person because you have 2 computers
The company you're using is so large and so are you and the technology you're using is about as complex as popping in a CD and installing word, and all you need is tier 1 and maybe tier 2 tech support. Servers? What are those? Oh you mean the people at the 5 star restaurant that bring me food?
If you don't fall into that category, contracting never makes sense. There is an ancillary case, and that's where regular employees don't actually do work.
not a doctor, not a lawyer, examples I use may not be fully researched so don't take out of context plz, don't @ me
Posts
Lord if could make a union happen I would do it in a heartbeat.
These people would rather have 40% of their bill rate go to the contracting company that's actively trying to screw them than see a dime go to union dues that is at least, on the surface, there to help them. Not to mention there still isn't really such a thing as an IT worker's union, so anyone we roped into representing us wouldn't really know how to do it correctly.
I've thought about this a lot.
This is america. Unions are dead.
fuck up once and you break your thumb / if you're happy at all then you're god damn dumb
that's right we're on a fucked up cruise / God is dead but at least we have booze
bad things happen, no one knows why / the sun burns out and everyone dies
This is super common in the Seattle area. All the bigwig companies here do it.
fuck up once and you break your thumb / if you're happy at all then you're god damn dumb
that's right we're on a fucked up cruise / God is dead but at least we have booze
bad things happen, no one knows why / the sun burns out and everyone dies
H1Bs as real employees and shitty contractor companies for all the rest of the American workers needed to clean up after the H1Bs.
fuck up once and you break your thumb / if you're happy at all then you're god damn dumb
that's right we're on a fucked up cruise / God is dead but at least we have booze
bad things happen, no one knows why / the sun burns out and everyone dies
Fuck that fucking noise.
You should up the ante because even with Ch11, companies have been known to pull that "sorry we have no money" shit. I think borders originally was Ch11 before they went bellyup.
Like file that shit though the DoL.
fuck up once and you break your thumb / if you're happy at all then you're god damn dumb
that's right we're on a fucked up cruise / God is dead but at least we have booze
bad things happen, no one knows why / the sun burns out and everyone dies
Any state where they are considered secured, they're after all the creditors since their debt is the "newest". With a bankruptcy that probably means there's nothing left to be liquidated to pay them either.
This differs state to state though.
good news, someone already made http://kindof.blue happen
Whatevs.
fuck up once and you break your thumb / if you're happy at all then you're god damn dumb
that's right we're on a fucked up cruise / God is dead but at least we have booze
bad things happen, no one knows why / the sun burns out and everyone dies
Microsoft's actually moving away from it, but in a way that totally fucks over all the contractors that are currently working there. The new policy that they're phasing in with the layoffs is that no contractor term can last longer than 18 months (with most being only 12 months long), and once your term expires you're completely blocked from any building/server access for 6 months, which pretty much ensures that the revolving door contractor system will fall apart out there.
This did this once before (with a 9 on 3 off schedule), then created a new class of contractors that could work year round.
Honestly I would be surprised if they don't do the same thing again.
fuck up once and you break your thumb / if you're happy at all then you're god damn dumb
that's right we're on a fucked up cruise / God is dead but at least we have booze
bad things happen, no one knows why / the sun burns out and everyone dies
Yeah, it'll definitely be a test to see if Nadella can stick to his guns on this one.
Apparently this is in response to lawmakers saying "If you work X amount of months you're no longer a contractor."
So they had them work X amount of months - a day. Then "fired them", then rehired them, then worked them X amount of months - a day.
So the lawmakers went "Well that's dumb, the purpose of this law was to prevent contract workers from being assumed to be an employee with no benefits of actually being an employee, so, that time period must be Y % of X."
So the companies hire people to fit that new amount of math.
You'd figure the amount of money the save doing this would be completely shadowed by the fact that you basically have to have lawyers, HR people, and all other support people watching all this shit to make sure no one goes over their work period, so you're essentially paying 20 some odd people their salaries because you don't want to pay one in benefits and a slightly higher salary than what they're getting now.
Basically the law should read "Listen if you're hiring people to do the work that an employee would do for more than a few days, we're going to hit you with fines that are greater than the average salary for people with senior level experience and paying them the difference, stop acting like dingleberries. Yes, that means you too MoneybagSoft."
I know a lot of people that work there, and really the only way this is going to work is if they plan on hiring the majority of the current year-round contractors.
Which I just don't see happening.
fuck up once and you break your thumb / if you're happy at all then you're god damn dumb
that's right we're on a fucked up cruise / God is dead but at least we have booze
bad things happen, no one knows why / the sun burns out and everyone dies
Why not? They basically already are. And they're paying the other company profit on top of it.
The culture's too messed up. The contractors are all second-class citizens who end up doing most of the work. You elevate them all up to FTEs and a bunch of the oldtimers are going to be pissed off.
fuck up once and you break your thumb / if you're happy at all then you're god damn dumb
that's right we're on a fucked up cruise / God is dead but at least we have booze
bad things happen, no one knows why / the sun burns out and everyone dies
Of course, a lot of those contractors are going to be doing shit like building security, landscaping, driving their commuter buses, running reception desks, etc.
Essentially, a dozen years ago, you had long time contractors, we're talking like 10 year contractors here, who never benefited from Microsoft's meteoric stock option gains.
Those folks sued and won like a bazillion stock options, quite a big expense for a company with a high flying stock. An order of magnitude more expensive than lawyers and HR and stuff like that, especially since large companies have teams of lawyers and HR on payroll already.
Looks better on the balance sheet. Contractors go under a different column. And you can totally just fire them at any time if things get dicey, they're obviously non-essential staff!
Bonus side effects:
You can now say you provide awesome bennies to all your employess without having to actually provide those bennies to all your employees.
Prevents unions from forming.
Prevents you from having to give people silly things like raises.
fuck up once and you break your thumb / if you're happy at all then you're god damn dumb
that's right we're on a fucked up cruise / God is dead but at least we have booze
bad things happen, no one knows why / the sun burns out and everyone dies
The math would work considerably in their favor if the people were real employees.
If, and only if, employees do actual work.
Hey now, we've got a lot of H1Bs and as far as I can tell they are on average more effective and have a better work ethic than our native employees. That could be because they're basically indentured servants though. Our guys we hire onsite in India, that's a different story; if they're still around in 6 months they probably don't suck balls, but there's a lot of churn.
No he's right there, it has to do with business expenses vs payroll or some other bookkeeping voodoo like that.
Contractors are waaaay more "sensible" from a business perspective. It also apparently (I don't know all the logistics) costs more to on-board and fire a full time employee than it does to empty the chamber and reload on contractors. Generally has to do with the benefits and whatnot. With a contractor you're just cutting a check, with an FTE you're getting them on your insurance and all that.
Unions?!? You dirty commie bastard, unions are evil and the scourge of the Earth and they are all too busy screwing over their members and counting their money to contribute anything to the world!
(/sarcasm)
Yeah but the company you hire from has to pay all that stuff. So you're paying for it through the company, plus their profit on top of it. You're effectively already paying for the benefits, the payroll taxes, everything. And you're paying someone else to be their keeper.
The only thing you gain is the ability to fire them. Which would be offset by having to retrain people every X months. Your business will take a hit from that and the profit where you'd probably be better off hiring your own crew of people, and getting ones you like so the issue with "firing" people isn't really an issue.
fuck up once and you break your thumb / if you're happy at all then you're god damn dumb
that's right we're on a fucked up cruise / God is dead but at least we have booze
bad things happen, no one knows why / the sun burns out and everyone dies
It's not just about how much more or less it costs, it's about how they write off the expenses. In essence hiring contractors becomes a tax dodge instead of a payroll burden. Businesses be greedy, if it legitimately cost them money in the long run, they wouldn't. If you can contract half your staff, that means you can essentially write off half your payroll as a business expense.
Regardless, being a contractor sucks ass and should be avoided whenever possible.
The only time you save money is when the contracting company is sufficiently large that they save so much money from economies of scale that they can pay for all that and take a healthy cut for themselves and still charge less than it would cost you.
In the long run it's more profitable to have actual employees, but good luck teaching shareholders that.
fuck up once and you break your thumb / if you're happy at all then you're god damn dumb
that's right we're on a fucked up cruise / God is dead but at least we have booze
bad things happen, no one knows why / the sun burns out and everyone dies
Yup you're paying for all of that stuff either way. And like I said, payroll taxes are usually deductible since it's a "regular business expense." Holiday pay isn't required by law, so... but yeah you're still paying for that.
Oh but then you go, "Bowen, but with a contracting company, when the IT guy is on vacation I still have an IT guy, but I only paid for 1!"
No, you didn't. You paid for the profit of the company and for the overhead to have a second person, of course, spread out over the course of the contract. You also are still paying for vacation time, health insurance, 401k compensation, payroll tax and profits for the company you're using.
There are two situations where this will work in the company's favor:
If you don't fall into that category, contracting never makes sense. There is an ancillary case, and that's where regular employees don't actually do work.