According to an internal memo obtained by the Seattle P-I, 66 employees at Volt, which is generally considered to be Microsoft's largest temporary staffing firm, have not signed amendments to their contracts, which would include 10 percent pay cuts. If contractors do not accept the wage cuts, they lose their jobs. The memo shows that one of the 66 is on vacation. However, some of the other employees are marked as "thinking" or having "escalated".
A Volt manager did not respond to a message seeking comment this afternoon.
Earlier this month, Microsoft alerted its temporary staffing firms that it would cut bill rates by 10 percent as part of a cost-cutting measure. All of the major firms have since cut wages.
About 15 temporary staffers employed at Microsoft gathered at a prominent intersection outside the company's corporate headquarters in Redmond Monday evening to protest upcoming wage cuts.
Microsoft told its temporary staffing agencies two weeks ago that it would cut its bill rates by 10 percent, in an effort to slash the amount it spends on contingent staff by up to 15 percent.
All of the major staffing agencies have since alerted employees that they will need to agree to wage cuts of as much as 10 percent or lose their jobs.
The contractors protesting Monday at the intersection of 156th Avenue and Northeast 40th Street said the ultimatum is unfair because they agreed to a fixed pay rate when they signed on to their Microsoft assignments, which typically last at most one year.
The staffing agencies argue that they can cut wages because the workers are employed at will.
"I think it's a really bad precedent that Microsoft is setting," said Twilight Wade, a software design engineer in test, who works for the Volt staffing agency.
"What's the point of a contract if it's not honored?" He said he would not agree to the cut and would likely therefore lose his job Tuesday.
Phil Palios, a Volt software design engineer in test, organized the protest, e-mailing a list of 2,000 contractors to tell them about it.
The protest was notably low-key, and attendance was much less than Palios had predicted. Palios held the only sign, upon which he had scrawled, "No Pay Cuts." A few cars driving by honked. But Palios pledged to stand at the intersection each day for the next two weeks and said the protest was a start.
"We need to show how we're all here together," he said, asking his fellow protesters to brainstorm ideas about how they could organize.
A Microsoft spokesman declined to comment about the situation.
Over the last month, the company has taken a series of other steps to cut costs. Microsoft has slashed 1,400 jobs and has said it will lay off up to an additional 3,600 employees over the next 18 months.
⇒ Show All Comments - Originally from Seattle Tech Report
Posted by unregistered user at 3/2/09 8:59 p.m.
The fact that we contractors have contracts completely negates any other argument. We signed an agreement to work for our employers on assignment for a full year at [x] amount. Our contracts have been breached. It was done without any chance at negotiation from those of us doing the work. Instead we have been handed an ultimatum of accept it or walk.
Nowhere in our contract does it state that this can be done. The conditions to which we signed on have been altered without our consent. Any other argument is superfluous.
While it may be true that Microsoft did not alter our contracts, this is the excuse our employers have used to justify their actions. In the blanket emails that went out notifying employees of the mandatory change the fact that MS cut their budget to contigent staff was the sole reason for our pay cut. As such our employers have stated that this was the fault of a MS action and logic would dictate that MS also has the ability to alter that. So anger at both parties, MS and our direct employers, is appropriate since both blame the other but in the end it is we workers who are out 10% of our agreed upon wages.
Statements such as "they should be happy to even have jobs" are the whines from those who succumb to fear tactics. If we do not make noise about this, if we don't publicize what's happening then we're party to this illegal act. Perhaps if those who happen to be unemployed were not silent they'd still have jobs. Who's to say? But keeping quiet is not an option.
Posted by Scampi at 3/2/09 8:44 p.m.
"Intel outsourcing some Atom manufacturing to TSMC".
10 percent less next year...
TSMC actually has a plant here in WA. http://www.wafertech.com/
Just so you know for future reference. :)
As for this unionization garbage? Man, I've got 0 interest in that. If MS is going to cut pay across the board, i'd rather it keep a company healthy then end up making the same money at the end of the day as I do now because that overage now goes to union dues.
Let's be honest here, the only winners here are the people who cut the costs and will get good reviews, and this Phil guy who's spearheading this. He'll end up the big class-action winner, and the rest of us will end up with MORE restrictions to how/where/when we can work, what our pay scale is, and worse off in the end.
I was part of the suit class in the Vizcaino suit. I didn't believe in it, but it was either my money or more in a lawyers pocket so I took it. 10 years later, i've been stuck with 100 days breaks here at MS, 6 month breaks down at Intel, and assorted day-to-day garbage because of that suit. I'd rather have the earning power of those months and the stability to do things like buy a home than have the check I got then.
I'm not saying this is right. I'm saying everyone's just going about fixing it the wrong way.
Work slowdowns? That's asking to be fired for non-performance!
Day-Without-an-ADash? again, fired!
Unionization? Don't we already complain about how much the agencies get for nothing? You really want a union rep in there too taking a cut? Good luck!
Whoever above said that people should be protesting THEIR OWN AGENCIES had it right. We work AT MS, not FOR MS. Apparently the old suits didn't get that through to some people.
The Agencies should be protesting magically getting paid less. You all should be making your agencies lives miserable. Fifteen people outside MS doesn't mean anything when MS doesn't control the trickledown of the money they pay out.
Posted by SuO at 3/3/09 11:17 a.m.
I happen to know contract agencies mark a percentage overhead for the hourly rate, and the last time I heard, the cheapest percentage was 24%. So if you make $50/hour, the cheapest agency is charging Microsoft $62/hr. If you are on the salaried option with a contract agency, they can bill you out at whatever they think they can get. I personally would never choose salaried. Oh, and that company charging the 24%, that is NO benefits, no nothing except cutting you a check every two weeks. If people want to be upset, I personally think they should be looking at their agencies more rather than just blaming Microsoft.
As for FTE pay, Microsoft does not pay as well as the rest of the industry, but they wholly make up for it with medical benefits. Someone said on one of these blog entries that the medical benefits should be taken away. I personally know of many of the high end folks who only stay at Microsoft and the lesser pay BECAUSE of the benefits. Microsoft would see quite a brain drain, imo, if they lost those bennies. Someone else asked if the execs are also taking the salary hits of no merit pay increases. I've heard conflicting things about this. Someone above says everyone is. I've heard that GM/PUM level 67s above are not, but it is total unconfirmed hearsay.
Posted by unregistered user at 3/3/09 1:51 p.m.
The contractors (disclosure: I am one) need to read their contracts more closely.
Both Microsoft and the agency retain the right to terminate the contract at will for any reason.
They may or may not offer a new contract at their sole discretion.
The agencies are terminating the current contract and offering a new one, both of which they have a perfect right to do. The protest is out of line and inappropriate. Emailing 2,000 contractors (including myself) is out of line and inappropriate. Claiming this is a violation of contract terms is simply untrue, as well as out of line and inappropriate.
Is job security effectively nonexistent in this industry? Yes. But that's not Microsoft's fault, and it's not the contract agencies' fault, and if it's anyone's fault at all... it's probably OURS. We chose to work under these terms. We could always have said "no" and held out for more job security, but we didn't.
Posted by unregistered user at 3/3/09 8:23 p.m.
I blame Microsoft, the agencies and myself. I'm a chicken with a large mortgage that now takes two paychecks to make. The right thing to do is leave now, but I don't want to ruin my perfect FICO score.
I will never again work for the agency that passed the reduction on to me. Neither should any of you. It is time to lay the cards on the table and stop protecting agencies and corporations. Create a free website and post hourly rates anonymously but include your title and years of relevant experience. Anyone with knowledge reveal what the agencies are charging on top of our rates. How much blue sky can we see today. Let's create a real market for our intellectual and creative power. We are not doing manual labor, many of us are creating valuable intellectual property. We are making the corporations rich by enabling them to harvest our innovations at absurdly low rates. Wikinomics feed the corporation not the innovator.
Lets turn wikinomics and globalization upside down. If a union does get started, it cannot be local, state or national but must be a global union of technology workers. International labor unions are the only counter measure to international corporations. Our union power should not be abused or else we'll evolve into the same unreasonable union as GM and Boeing. Our union should be organized like a wiki. Bureaucratic hierarchies and old value networks get corrupted easily.
WikITunion the way! End the hundred day!
Posted by unregistered user at 3/3/09 8:55 p.m.
Agency worker: I did not assert there wasn't a contract - it just isn't with you. It is with your Agency with you as the named resource.
What MS is proposing in the rate cut is a termination of the existing contract and creation of a new contract at a lower rate. If you don't accept the rate cut, your agency will change the named resource and create a new contract without you.
You can fear-monger all you want on these boards, but the contract I signed is with me and my agency. Period. My contract is separate from any contract my agency signed with Microsoft. The two are separate and separately legally enforceable.
NO ONE is arguing the agency cannot terminate a contract.
The issue is that the Agency cannot just unilaterally change the terms of my contract without renegotiating and re-signing. That is called breach of contract and it's illegal.
Clearly working for an agency doesn't make a person an expert in contract law.
Posted by SuO at 3/4/09 8:42 a.m.
To unregistered user post #267544 -
What 15%? I ask that not snarky btw. I believe FICA is about 7.5% between social security and medicare. Unemployment insurance is smaller, especially in high tech, and I believe tax deductible by the company.
In all fairness, I have never run a staffing agency, so I don't know all their overhead costs. However, it seems to me with some of them charging 30% or more on billing hours, that seems high to me.
The argument of contractor vs FTE is really all from the different peoples' perspective and greatly depends on which group and leadership you work for. Contractor overtime is limited when there are budget crunches. Both work OT and not. Both have lazy idiots and smart hard workers. As to the treatment of contractors with access to certain meetings and parties and now the break in work of 30-60 days, that is all the result of that nice little greedy lawsuit years ago where they wanted their high pay, OT pay, AND stock. So high tech companies had to make darn sure that contractors didn't get the wrong impression and think they were employees entitled to any FTE stuff. Before that, contractors were treated exactly as FTEs as far as inclusion in everything - I know, I was there.
Posted by cowatson at 3/11/09 6:20 p.m.
If their pay is similar to the kid making $70k who started a protest and then stopped when he finally got a clue, I do not feel sorry for these people when they are terminated. I am pretty sure they can be replaced.
Posted by StriderWA at 3/11/09 6:48 p.m.
I was laid off from my IT job in Jan. I'd gladly send my resume to their Volt contact and take one of those positions.
Posted by cj in seattle at 3/11/09 7:52 p.m.
Ah so this is how you do it with out riding the lay off train. I don't know what they pay was but you should send them your resume if your interested. You might want to find out what your signing on for first though.
Posted by TerryP at 3/11/09 8:08 p.m.
Correction to last post: Second sentence should be "what they paid" or "What your pay was."
Last sentence should be "...what you're signing on for first" and delete "though."
This demonstrates why newspapers have always used copy editors; a profession probably soon to disappear.
That all said, I applaud the courage of these people who are swimming against the proverbial tide. It makes me ashamed to admit I was the person who had said, in a raw attempt at humor, comparing Microsoft the Borg collective of Star Trek 2, that "resistance is futile" and encouraing contractors to just give up hope.
These people may lose their fight, but they show the continuing truth of what Robert Browning once said, to wit, "A man's reach must exceed his grasp, or what's a heaven for?" (Hope all that was sans typos. My miserable excuse, if not, is it has been a long, tough day and dinner awaits.)
Posted by jeffw66seattle at 3/11/09 8:16 p.m.
Requiring employees to sign an "amendment" to a previously agreed upon contract makes the original contract not worth the paper it was ever printed on.
By refusing to sign, these employees are making a simple statement - written agreements are supposed to MEAN something. Here's hoping that their firings allow them to collect full unemployment benefits - which result in an increase in the employment security taxes that employer must bear.
Posted by voiceofreason1950 at 3/11/09 8:22 p.m.
jeffw, you make a good point about any subsequent firings if the contractors don't sign the amendment. This wouldn't be a "firing with cause" so it seems like the agency would have to pay up with unemployment. The downside for the contractor though is that they will never work in this town again. Agencies will tell you there is no "black list" but there is, oh yes there is.
Posted by unregistered user at 3/11/09 8:28 p.m.
I absolutely agree with jeffw66. These must be brave individuals who are unwilling to consent to the company simply taking advantage of their compromised job security and economic position to pressure them into accepting an unfair agreement.
Posted by unregistered user at 3/11/09 8:38 p.m.
"They just need more people to have a spine and join them."
And people say there is no place for unions any more these days....
Posted by AlbertCamus at 3/11/09 9:15 p.m.
This is Microsoft exploiting its workers in a down market. Micorsoft itself continues to make money hand over fist and there is no reason to lay off anyone or cut anyone's wages except to improve the bottom line some more on the backs of its workers.
Posted by unregistered user at 3/11/09 9:26 p.m.
Good luck to them, although it is certainly futile in the long run. MSFT has lived fat and happy by taking on contractors instead of employees for a VERY long time. What *really* needs to happen is the staffing agencies all need to stand up and say "a deal is a deal". If the staffing companies refused to go along, MSFT would fianlly have to hire actual employees for those jobs, which truthfully is what should have been going on all along. Sorry, but I can't get all emotonally upset for MSFT -- they have done a lot of good for the area for sure, but they have also been given a TON of waivers and breaks along the way.
Posted by unregistered user at 3/11/09 9:27 p.m.
i wouldnt take a 10% cut. as was said already microsoft is still making plenty of money and this is the reason why you need union representation. groceries have gone up 10% so how can you give up that much of your earning power.
the big reshuffle is real estate. these mortgage companies already have an appraisal theyre willing to value your real estate at and theyre willing to loan even less. i didnt get a memo but i tried to take advantage of the refi, no dice but i dint find they already have an appraised value....so why did i have to hire an apprasier?
ya say you want a revolution well ya know, we're all doing what we can
Posted by zardoz at 3/11/09 9:34 p.m.
I doubt most of these people are trying to make a point, nor do I think there is one to actually be made.
Microsoft is cutting wages. If their somebody don't like it, they're free to go elsewhere. If enough contractors left, I'm sure MS would reconsider their position, but I cringe at the thought of workers leaving due to a misguided sense of "solidarity" rather than evaluating their own personal situation and values and acting accordingly. It's this kind of group-think that has given unions such a lousy reputation.
Saying "Microsoft has plenty of money right now, they don't need to cut wages" is the kind of complacent thinking that's got GM and Chrysler on the brink of bankruptcy. To stay on top you've got to be a step ahead, and not simply do things out of necessity or desperation.
That's the beauty of the free market, each individual acting in their own self-interest. You don't have to debate what's right and what's wrong.
Posted by unregistered user at 3/11/09 10:02 p.m.
What these temps fail to understand is that their employment is at will. If they wish to longer work at the new wage they are not required to do so. However, MS/Volt are not required to retain them.
They might be great performers who are worthy of an exception. On the other hand, they might feel entitled to their pay even if their performance is only mediocre. None of us will really know. It will be interesting to see what happens to these 66 temps.
Posted by ComplexNumbers at 3/11/09 10:07 p.m.
Cowards never like it when and individual decides not to take it anymore and refuse to join the ranks of the cowardly.
The Soviet Union was brought to its knees by the actions of a few shipyard workers in Gdansk poland when they decided they would rather die than to hand thier children another generation of bowing and scraping to the economic powers that controlled every facet of their lives. The same monsters that controlled the USSR are in control of the economy of the world. We used to call them party bosses now we call them corporate wizards.
If the same people that seem to think that taking lower and lower wages will satisy the monster then all I can say is "keep kissing the beasts a## maybe they will keep you as a pet".
As for me and my children I would rather they stood up for what is right and not be a coward.
May God Bless the 60 "Refusniks".
May God Damn to eternity the greedy b######s that put Americas working people in this situation.
"To stand with workers is the primary duty of government all else is treason"
Abraham Lincoln
Posted by unregistered user at 3/11/09 10:22 p.m.
IMHO, this company Volt is trying to pass the blame on Microsoft. Many service companies provide services to other companies. These rates are going down. So Volt revenue is going down. It is upto Volt to decide how it eats the decrease in its revenue.
Microsoft and other tech companies, are also losing revenue just like Volt is. Whether these tech companies do layoffs, or reduce pays, or take other measures it is upto them. If Dell is buying fewer licenses or cheaper licenses from Microsoft, should the layed off Microsoft employees blame Dell? Microsoft-Volt is a company to company, relationship based on market prices subject to negotiation and renegotiation. Volt-"and its employees" is a firm-worker relationship, which is a touchy subject. Contracts get negotiated all over the world. Airlines and Car companies are two such examples. The same is Volt, which provides workers, sell services at market rates. Anybody could replace Volt, e.g., Volt employees if there is another company instead of Volt. Such companies have to renegotiate with their employees in tough times.
Posted by unregistered user at 3/11/09 10:28 p.m.
Karma is in the house! Volt is laying off a large number of internal staff, particularly those in management positions, who have done such a poor job of managing the company. They have been tossing money down the crapper for years, particularly in the Seattle area, and specifically in the non-tech sector. The pretty offices and brain dead senior managers are not looking so good these days. THey are merging their tech and non-tech divisions and are desperately trying to stop the bleeding.
You should know that no one has had a 100% mark up on tech staffing since Y2k scared the crap out of companies. Staffing companies make poo on their large staffing contracts. Microsoft probably had a 42% mark up and is now in the 30's. In the staffing world that is a money losing operation. They screw the non-contract companies on mark-ups to make up for the low rates on fancy companies like Microsoft.
Posted by unregistered user at 3/11/09 10:32 p.m.
"It is typical for agencies to bill Microsoft up to 100% more than they pay the workers"
Not sure where you have done a contract, or if you have EVER done a contract, but consider the fact that the rates MSFT paid in the first place to temp workers have always been below market, because of their volume. To even think a company like Volt (or any of the others) is marking up a rate by 100% to MSFT and pocketing the difference is assinine. For some reason, someone always wants to jump on that horse, yet cannot prove any of it as fact. I worked there as a temp, and know that most of the other temps I talked to all were making about the same as me, and I knew what I was being billed at. There was a difference of about 30% between my pay and the rate to MSFT. Volt has a business to run as well, and like any smart business, they are going to cut costs when forced to cut revenue, that's business 101 if you've ever learned that.
The person that posted about the United Autoworkers mentality has it right, if MSFT wants to cut rates becasue the market is allowing it, they can, and any good business would do that. They don't answer to any of you, they answer to their shareholders.
Get a grip people and move onto something more relevant. So you took a 10% cut off your 70K a year job, better than 500 a week in unemployment, huh? Microsoft isn't the ones that put us all into this mess.
And to call workers that accepted a pay cut cowardly is assinine...shows that you think they all should be sacrificing their and their familie's best interest for your dated ideals on democracy and how we are all so enslaved to "the man"...go back to your cult or compound and keep stocking up your granola for the coming revolution.
Posted by KaninZ at 3/11/09 10:58 p.m.
Another argument for significant reform in hiring practices. It's time to try the DE-temping of America.
Temporary agencies are a good idea that has been misused to create a slave wage class of Americans who are fired, denied benefits, given reduced wages or hours at the whim of their contract agency and/or the business where they perform their work. All in the name of the bottom line.
Posted by unregistered user at 3/12/09 1:22 a.m.
When I temped years ago for law firms, I saw the billing. They paid me $8 an hr and Sarah Woods billed out at $13.50.
My wife negotiated between contracting companies at MS after her first 100 days off and when Volt tried to reclaim the contract (after she'd done the leg work - the agancy was a formality and had dome NOTHING to get her the job. She worked there years before as an FTE) they couldn't understand why she wouldn't continue to work for Volt at $4 less per hour and garbage for health benefits.
You can draw your own conclusion about their managment capabilities.
Microsoft has more contractors than FTEs - this is something corporate America has been doing for years. It makes their "core" set up look "lean" for investors.
MS has how many BILLIONS in cash reserves, but they need to pare down? That's NOTHING but taking advantage of market conditions to lower the cost of labor.
Posted by zardoz at 3/12/09 2:36 a.m.
That's NOTHING but taking advantage of market conditions to lower the cost of labor.
So what are they supposed to do, IGNORE market conditions? I don't think that would be a particularly savvy business strategy.
I've got a friend contracting at MS who had to take the pay cut, which dropped him to $32/hour. It's not like we're talking about minimum wage earners with no other options here. These are skilled, educated people that are capable of finding other jobs if MS pushes them too far.
But it's absurd to expect MS (or any business) to stand pat when the market has dramatically shifted. That's exactly the kind of complacency that's gotten the US automakers into so much trouble -- they spent far too many years with a work force that was overstaffed and overpaid. Only now, with no cash in the bank, are they finally making the drastic, painful cuts that should've been made years ago when they still had money.
Posted by unregistered user at 3/12/09 4:05 a.m.
ComplexNumbers writes-
If the same people that seem to think that taking lower and lower wages will satisy the monster then all I can say is "keep kissing the beasts a## maybe they will keep you as a pet".
Sending out a "you go guys" to the 66 Voltians. This is going to hurt many (but not all) of you financially in the short run, so I hope you've thought it through and are ready and willing to deal with that. In a way, though, you've already gained. You have a story to tell your grandkids about how you had a well-paying job as a temp at Microsoft, but walked away on principle when they used your temp status to require you to take a pay cut (possibly adding, "I ate ramen for the next 7 months, and was glad to do it, because sometimes sacrifices are necessary when taking a tough stand"). And unlike thousands of others who clicked Agree, you don't yet know your "price" (ie, the one for which your principles can be bought) other than "it's somewhere above what they offered."
If any of you are going to go it on your own, you have a great story to tell clients about how seriously you take signed contracts and don't believe in taking advantage of the other party by exploiting technicalities in the letter--as opposed to the spirit--of those agreements.
Signed, one of the probably 5 people recently laid off from Microsoft who did not sign the severance agreement they offered, also on principle. From what I've heard on the street, most people's "deals" more closely matched what they were giving up in career opportunity and as yet unvested stock than mine did, due to the formula used to compute the numbers. I didn't feel right about taking the crumbs dropped from the table after giving the company the best N years of work in my life, even if crumbs was the best I could hope for in an at-will situation.
Posted by unregistered user at 3/12/09 5:23 a.m.
Corporate America believes slavery is the best business model, and that's what they really want. They already have slavery in workplaces in China, where they've outsourced millions of American jobs.
God bless those 66 workers for having the self-respect to stand up for their rights, and not just cave in to being treated like slaves by Microsoft and Volt.
Posted by unregistered user at 3/12/09 5:35 a.m.
I worked for Volt (briefly, thank goodness) between real jobs years ago. I thought they demeaned people and treated them disrespectfully, probably to psych them into believing they weren't deserving of decent pay rates. The job assignments were pretty crappy too.
There actually are some reasonably good temp agencies out there, who treat people right and try to get them good job assignments with fair pay. They're worth looking for; I've had good luck with Adecco.
Posted by unregistered user at 3/12/09 6:29 a.m.
A contract is a contract. If MS will not live up to what they agreed to they should be sued. When the contract is up that is the time to negogiate a new rate. MS is famous for skirting the laws and for treating its temp employees as dirt. There have been several lawsuits in the past that MS lost. I suspect these employees refusing to work for less then their contract says already know where to find another job or do not care.
Posted by unregistered user at 3/12/09 6:36 a.m.
I'd take the 10% cut and be 20% less productive! I'm sure this pay cut is going to cost Microsoft in the long run one way or another. I wonder who is the brilliant manager who forgot to think of lower employee morale and productivity, bad publicity, lawsuits etc? Will she be running for Congress?
Posted by unregistered user at 3/12/09 7:46 a.m.
I'm not participating in the recession. A contract is a contract. They can take the chance of being downsized (there's a word for you) and that is their right. It's time we stopped feeling sorry for them. We are adults not kids. Take responsibility for what you do and let the other person figure it out if they can. Remember that 90% of the workforce is still out there working. Stop listening to the news people.
Posted by MinusTwenty at 3/12/09 8:03 a.m.
And just you wait until the next news report informing us that "Microsoft, claiming a shortage of skilled labor, again lobbied Congress for an increase in the annual quota of allotted H1-B work visas it is given"
This is all about class warfare. Microsoft is just trying to attack its workers wages. Even in a recession - where are the executive pay cuts? Has there been a SINGLE executive pay cut at Microsoft? NO. But they feel free to try to re-write contracts mid-stream.
What a terrible company!
Posted by unregistered user at 3/12/09 8:08 a.m.
My daughter, a contract worker at Microsoft is now making less than $15.00 per hour with the 10% cut. No insurance either. Can you live on that? Has the leadership of Microsoft modeled the practice of pay-cuts?
Posted by unregistered user at 3/12/09 8:12 a.m.
Volt takes a HUGE cut off the top of the contractor's pay and pays well under what other companies will. My company refuses to use Volt for this reason. Contractors have little negotiation or power when they apply for positions through Volt. You can only work at Microsoft for one year as a contractor then you have to leave and wait ninety days before you can return. You can apply for unemployment during the ninety day break.
Posted by KevinMc at 3/12/09 8:15 a.m.
I think we're really dancing around the issues here (though some of us are making excellent points). Over the years, labor law has eroded to the point that workers have very few rights. Government officials are benefiting from corporations when as they (gov. officials) continue to erode and allow the erosion of workers rights. In the end, we went through the whole Perma-Temp thing with MS over 10 years ago. Now, we have contracts that MS negotiated with VOLT and other agencies and thus with employees. A contract is a contract - it is a legal promise with obligations on BOTH sides. It is wrong for MS to forcibly renegotiate those arrangements. This would not be allowed if labor law once again had teeth. Additionally, MS is NOT hurting for cash. They are NOT asking all of the FTEs to take pay cuts, why the contractors. Contractors beware, do you want to be a slave of MS for the rest of your days? Stand up for what SHOULD be your rights!!
Posted by HDLife at 3/12/09 8:25 a.m.
MSFT contracts with the Temp Agency. The Temp agency contracts with the individual. As I understand it, both contracts contain clauses that allow for any changes to be attached at any time by MSFT or by the Temp Agency. But not for the individual.
The contract gives a legal out for both the major players to do as they please. It is a contract that is either agreed to by the individual or else no position, so the individual cannot say anything about it. But I feel that such a clause could be contested and possibly removed. Owing to the fact that it is a one way clause that puts the individual at risk for anything that either major players would want to do.
If you look at those credit card "fine prints" in pastel almost unreadable 'contracts', it is worded differently, but the same result. They can make any changes in your contract that they choose to make, and they do, and you do not have any say in the matter at all.
Face it, we, the "individual" are at risk to those major players on every field. Those who say, "be glad that you still have a job and shut up", well all I can say is that at some point you simply must choose not to "shut up", and take a stand. Sure it may cost you your position, and it is something that these '66' do have to consider for each on their own. All those temps have to, and some weighed in by simply accepting based upon their individual needs. I can support both those sides, but those who would sit on the outside and tell the ones taking a stand to shut up.
I don't know what their salaries are. Some here have said as much as $70/hr. and others about $30/hr. But it doesn't matter what range the temps salaries are in, what matters is that the contract puts them in a bad position no matter what. Today it's demanded a 10% cut, next month, two months, whatever, it could be another 10% cut or maybe more...where does the line get drawn?
I have worked temp, and I know that the agencies are screwed up...mostly. That if you give them any lip, they either drop you entirely or else push you way down on their list to contact for openings. But it is also a fact that most employers are now going through these temp agencies to hire. That way the contracting employer does not have to concern themselves with providing anything but employment with not having to provide any benefits. They get the work done on the cheap increasing their profits, but little to no deductibles. Are there good temp agencies out there? Yeah, but even some of the good ones have people in charge who should be in charge of anything except to clean toilets.
Posted by unregistered user at 3/12/09 8:28 a.m.
I'm not sure about the rest of the world, but it appears that most of the people who are responding really have no clue about working as a contractor.
In general the money is good, but in general most of us have no benefits (no health care unless we pay for it, no paid sick leave, no paid holidays and no paid vacation). For most employees this means that your employer is paying you for at least 240 hours each year that you didn't actually work. Most contractors forgo vacation, NEVER get sick, and are NOT allowed to work on holidays.
In addition to that, MS contractors (at least the a-) are required to leave MS for a minimum of 100 days after working for 1 year. Most of you should be able to figure out that $35 per hour isn't nearly as high as you think it is.
Many of the people who refused to sign were likely nearing the end of their contract and didn't like being forced to take a contract change. They are starting their 100 days off a few weeks early.
Many contract companies (including Volt) do very little for their employees (contractors) after a job starts. If you are lucky, you will hear from a rep every three months. Their primary expense is the sales people who work with us to locate a position. They are in business to make money but with only a 30-35% markup, how are they to survive (did I really say that).
In this case($35) cut the contractor rate by $3.50 while Volt's cut is approximately $1.20.
{End of Ranting}
Posted by unregistered user at 3/12/09 8:39 a.m.
I have chuckled and cringed at the lack of understanding of contract knowledge of those posting these comments. This is not a renegotiation process, this is a contract termination and new negotiation at a lower rate. They may process through an amendment (quicker and easier) but the truth is - MS is terminating all contracts with their Temp Agencies and re-instituting new contracts at lower rates.
All of these contracts have termination clauses and the temp agencies and MS are exercising them. As for those out their that are throwing the blame at MS - focus people. MS is cutting costs by reducing rates with their Temp Agencies - not with their Temp Workers. The Temp Agencies are reducing rates with the workers. If you want to get angry - get angry at Volt and others.
MS may have billions. It is their billions and it is their job to spend it wisely so shareholders - like many of you and myself - continue to see market gains. (For those of you saying you don't own an MS stock, you might want to look at the Mutual Funds you own as the majority out their own MS stock.
These 66 people may be making a stand and they should get used to it. As they will be standing in the unemployment line for quite a while.
Posted by proudtobealiberal at 3/12/09 8:53 a.m.
No sympathy from me - - they can just move back to Mum-Bay or Bangalore or wherever they call home.
The H1B program is just a small part of what has wrecked this country's economy. Big businesses say they're for capitalism and free enterprise and competition, but they begin to act like monopolists and kleptocrats first chance they get.
Always been that way, always will.
I don't recall reading anywhere that Bill and/or Steve have had their pay cut by 10 percent, or 1 percent, or anything at all. They're probably on the receiving end of huge bonuses for "cutting costs" by short-changing their perma-temps.
Business as usual in the land of Unregulated Laissez Faire Capitalism.
Posted by Ocerith at 3/12/09 9:00 a.m.
"You should know that no one has had a 100% mark up on tech staffing since Y2k scared the crap out of companies."
"To even think a company like Volt (or any of the others) is marking up a rate by 100% to MSFT and pocketing the difference is assinine."
Actually, to think that any contracting company DOESN'T markup AT LEAST 100% is asinine. Despite your ridicule of one poster, you clearly haven't worked a contract job yourself, or are completely blind to the realities of contract work.
Trust me, I know exactly what the hourly rate the contractor gets compared to the bill rate is across tech companies. The margins vary individually but they are all staggering. Think 150% - 200% markup range. That's right, if you're making $50 an hour, your agency is billing $150 an hour. People think "contractors are cheap," but they're not. There's another reason why contract labor is considered cheap in a quarterly numbers mentality. It's a different bucket of money and it comes off the books when you need it to. The actual bill rates, meanwhile, can exceed the bill rate of a permanent employee.
These are just the plain, simple facts from an outside observer with no interest in either party.
Posted by unregistered user at 3/12/09 9:19 a.m.
that stupid CEO is running the business into the ground - he has no vision and has done nothing useful since taking over - if it was any other company, it would have been game over for him long ago.
Posted by Nebula36 at 3/12/09 9:30 a.m.
I'm not a big fan of unions, in fact I think it's ridiculous what some union workers in Detroit are being paid.
However, it's perplexing to me that many temp jobs that I worked at in the mid-1990's are still being offered at the same or lower pay rates. The temp agencies seem to be exploiting the workers even more than the large employers.
These guys getting $35 per hour aren't starving, but the principle of being jerked around by your temp agency that bugs me. Especially when companies like Microsoft are so dependent on them.
Temp agencies deserve nothing.
I also think it's bizarre that so many retail and food service jobs still pay so little. Things have barely changed in almost 20 years, yet rental, food, and gas costs have increased quite a bit. It's almost impossible to work at one (or two) of those jobs and go to school to improve your opportunities at the same time.
THOSE are the people who need to unionize and agitate for better wages.
Posted by unregistered user at 3/12/09 9:36 a.m.
What others don't seem to understand that a Contract is a written agreement agreed to by all parties. The wages should stay the same until the contract term is up. I would not only disagree to take the pay cut, I would sue the temp agency (whoever they are)for breach of contract, then sue for damages. When the worker signed up for the position based on pay and length of assignment it was a written agreement. Let's not let Corporate America break the rules ! Stand up and fight ! (if there is language in the contract for a pay cut then you signed the wrong piece of paper). I am not litigious I just believe in fairness to the little guy. Microsoft has how many billions in cash ?
Posted by unregistered user at 3/12/09 9:57 a.m.
The Volt Contract also says that either side can terminate the employment at will, for any reason. refusing to sign the addendum is their choice, but Volt would be with in their rights per the contract to terminate the contract. If you are working at MS and signed that contract, then you should be aware of that. At least that is what MY contract said.
That doesn't make it morally right for Volt to do that, but they are legally able to.
Posted by TricycleDriver at 3/12/09 10:13 a.m.
there's something funny about this article...(I've been a v- and a-)
The wage contract is not between Microsoft and the worker. Any contract agreed between Microsoft and Volt have been made. It's between Volt and the Worker to negotiate what they're going to get. I use to make $70000 for a 1-year-only term, Microsoft paid 100,000 Volt ( I got buddy-buddy with the manager and he told me.)
I don't love Microsoft, but most of the Microsoft basher who have posted are ill-informed. billG has retired. Microsft should not have even been mentioned in this article.
Posted by XXXmsft at 3/12/09 10:20 a.m.
I guess not everybody can be a math major, English major, or heck, even graduate from college. But reading some of the responses here is like listening to "Money for Nothing" by Dire Straits. I contracted for 3 years at Microsoft before and after working ten plus years as a full time Microsoft full time employee. I work now outside of Microsoft and can walk to the main campus from my present employer. That's as close as I need to get. Take a look at the $35 an hour contract rate. For Microsoft contractors that is for 52 weeks of employment followed by about 15 weeks of unemployment (100 day break). So that 70,000 + a year (52 weeks/ 2080 work hours at 35 an hour) really works out to an average of $26 an hour for 67 weeks. Sure, you can collect a fraction of your salary through unemployment insurance for that 100 days, which will be eaten up by your COBRA payments to extend your medical insurance at full cost. The agencies count on that, because they are worthless when it comes to finding employment for that 100 days. Your current MSFT agency doesn't want to jeopardize having you available for MSFT asap after your 100 day break. Outside of MSFT, other agencies and other companies do not want to hire you for less than 90 days because they know you'll bolt for MSFT as soon as you are available again.
In the Silicon Valley, contractors have more choices and competition for their services, so no company down there can control the prevailing contracting rates like Microsoft does up there.
Contract workers at Microsoft have little choice but to take what is offered. Many contractors would love to work full time at Microsoft, even with the lower salary they'd receive, because of the benefits. The medical insurance offered by Volt and other agencies does not begin to compare with the cost to the employee and the services covered that Microsoft and other employers offer their full time employees. My family's medical bills just since January would have eaten up half a year's wages if I was still contracting.
For those who keep harking about contracts being a ironclad agreement. This is an employment at will state. Either side can terminate the agreement at any time. A contract simply means that you and the agency have an agreement about the expected length and pay of the contract. It is not a guarantee that you will work the full term of the contract. It is also not a guarantee that you will receive that rate for the term of the contract. It is unfortunately designed for the benefit of the agency and client, not the contracting employee.
Last, but not least, it is probably better for all of us that more people are employed, albeit with a reduction in pay, than have more people unemployed for the benefit of maintaining a full salary for the people still employed. For most contract workers, there is no side work or contract work available---we're in a downward spiral, remember? If Microsoft is "making money hand over fist" and they are taking measures, you think the companies that are losing money right now are going to be hiring? They'll be more severe than Microsoft. Give Microsoft some credit; they could have just said we'll eliminate 10% of their contracting work force. They did outright eliminate several thousand full time positions. Those employees do receive generous severance packages. A laid off contractor worker gets none. Your job is done. Today. Get your stuff together, give us your badge, and we'll escort you to the door.
Posted by unregistered user at 3/12/09 10:21 a.m.
I'm not too well-versed in how this contract game plays out but why do the workers have to take the 10 percent pay cut? Couldn't the agency suck that up? It seems to me as though what the tech workers are offering is more important than some recruiter sitting on their fat lazy butt all day matching resumes with the job opening. I don't have much respect for these agencies nor do I care for the vultures who make these hiring decisions.
Posted by XXXmsft at 3/12/09 10:45 a.m.
The 10% cut is what Microsoft has asked of the agencies on their total billing. I really don't know exactly what the agency bills in comparison to what they pay the contract workers. But say Volt bills $70 an hour for a tester, and then in turn pays that tester $35 an hour. If Volt has to cut their billings by 10%, that means they now bill MSFT $63 an hour and the tester gets $31.50 an hour. Microsoft scrutinizes their vendor's very well, and expect them to provide the most for the least. Whatever margin MSFT allows Volt in this, nobody at Volt is making truckloads of money. Volt is not passing their entire 10% reduction on to the contract workers. If they did, the actual reduction in pay for the contract workers would be more like 20%. There's a lot of competition between contract agencies to fill the job reqs that MSFT puts out, so no agency can afford to price themselves out of the market with a billng rate that is higher than their competitor's.
Posted by vicious_cycle_00 at 3/12/09 11:16 a.m.
WOW - where to start...
First, some people seem to think that 'a contract is a contract' - which for temp worker is true, EXCEPT the fact that from my personal experience in contract work (5 years), in every contract I've ever signed, it is WRITTEN IN THE CONTRACT THAT THE COMPANY BEING WORKED FOR OR THE TEMP AGENCY CAN TERMINATE THE CONTRACT AT ANY TIME - no reason required. It seems that that is what MS is doing - terminating all the contracts, and giving the terminated employee an option to resign a new contract at a lower wage. Those that refuse to sign, well, that is their personal choice. But their original contract would be void, so they essentially would lose their job. I don't think taking this issue to court would go very far just from the fact that this 'out' clause is just as legally binding as the rest of the language on the contract. I know Volt has this clause in their contracts - so does Techlink NW - so does Proactive Staffing - and on and on.
Second, i think that it is commendable that MS is trying to cut costs by reducing WAGES instead of STAFF. Do you think those laid off in the auto industry had the option of taking less pay? How about the millions of other people who have lost their jobs in the last 6 months? Do you think any of those companies offered reduced pay instead of termination? Ask some recently laid off people, and I bet that 2 out of 3 would have rather taken a 10% cut than being laid off. I commend the ones trying to fight this fight - but as someone else posted, you need to pick your battles wisely, and this is a battle that they will probable lose.
Posted by Wangster at 3/12/09 11:17 a.m.
Volt needs to honor its contracts.
btw, with unemployment, the only "causes" that can disqualify you is misconduct such as violence or threats, with burden of proof on the employer. Incompetance gets you unemployment benefits, as well as dismisal for policy breaches, even telling your boss to "go to hell, of f___ off" as long a no threats of violence are made.
Now I have an estimated 9 month take home pay in assets, most of that cash, and now with extended benefits a person can work part time enough to stretch their unemployment out for 2 full years. I could weather out a long storm.
A contact worker can easily get a few letters of recommendation from Microsoft colleagues and move on. I have always written letters of recommendation for good working colleagues who were laid off. Microsoft and Volt are just seeing who will blink and fold their cards, and its always people who have poorly mismanaged their own money. If over half the people refuse to sign the amendments, it will probably cost both companies much more money to replace the people lost or to make up for what they lose than they would have saved.
And last of all, computer professional are probably the most likely people to still be able to get jobs today, even with all of the layoffs. It would be interesting to see how many of these contract workers can get new jobs lined up before any supposed deadlines to sign the amendment. Hell, that would be the best of both worlds, have a job lined up to start in a month, and get laid off and collect unemployment for a month and take a "paid break".
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