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HP Contract Workers Sue For Recognition
manganese4 writes "The Idaho Statesman is carrying the story of 33 local Boise HP contract workers suing HP. They claim that they were expected to perform at the same level of expectations as HP workers and thus should be given the rights and privileges of HP workers. HP claims the suit is without merit." From the article: "The suit seeks to represent 3,000 workers in Boise and elsewhere in the company and could involve as much as $300 million, according to the complaint."
My wife and I each spent a stint with Compaq (became HP while she still worked there) and they play this game all the time. They work everyone the same, but 'badge' employees actually get vacation, 401k, etc.
It wasn't right then, and if it's still going on, good for them for suing. I knew people that had worked there for YEARS and never got 'badged'. No vacation time (although you could occassionally get time off without pay) and rarely, if ever would you get any kind of incentive or pay increase. You'd also usually get let go without warning, and the contractors would play a game of saying that you're still employed with the contracting agency, thus not entitled to unemployment benefits (which, at least under Colorado law is not true. I managed to get benefits).
Anyway, it's about time.
Karma: Chameleon (mostly due to the fact that you come and go).
The IRS rules on this are quite specific and, IIRC, Microsoft lost a huge case on this in the early 90's for hiring contractors that were, in essence, 2nd class employees.
From the article:
Huntley's lawsuit cites all 20 criteria and claims that in every case HP treats contract workers as employees.
Among them:
Does the worker have assistants whom the company supervises and pays?
Does the company furnish tools, materials and other equipment sufficient to show control?
Is the worker required to devote substantially full time to the company?
Kaupins advises companies to check with the IRS if they have any questions about contract workers vs. employees, because companies can be held liable for back taxes if worker status changes from contractor to employee.
"I'd rather be a lightning rod than a seismometer." -Ken Kesey
Back when I did contract work, I always had to go through a large agency because:
I wasn't on the preferred vendor list
I needed to have more than five employees working at my company
I needed to be incorporated - not much of a problem. My accountant did it for me for $75.
When I asked why the hoops, I was told about IRS rules. When I pinned them on it they confessed that it was because they were afraid of what happened in the article happening to them. As a result, I earned 40% less because of people like the above.
Hello, when you work for a contract company, you are treated differently: usually paid more then the regular employees.
Sorry about the rant.
As the IRS and Microsoft worked out, a "temp" employee working for some period of time, like over 5 years, eventually crosses that gray fuzzy line and actually isn't a temp employee anymore.
The same doom and gloom was predicted for Microsoft before that permatemp lawsuit was won by the permatemps.
I don't know, though, who's won the war.
It's nice as a contractor, when things at the company are very chaotic, knowing you're just a contractor and your boat doesn't really sink or swim with the fortunes of the company for a variety of reasons. Sure, you might be out of a gig, but it's just a gig. There will be others.
In this case, the contractors are claiming that for all intents-and-purposes, they functioned more like actual employeed than a contractor. They're use IRS defintions to back their case.
If the company can have you classed as a contractor, they save mondo money on not paying you benefits. They're saying they did the same work in the same office and effectively get discriminated against.
As I recall, a similar situation used to (does?) exist at Microsoft -- people could stay as contractors for years in the same position. They got none of the perks and benefits, and were effectively second-class citizens (or so I've heard, I've never even been to Washington State).
These people are trying to get themselves recognized as being actual employees, or at least equivelant.
Cheers
Lost at C:>. Found at C.
If the company can have you classed as a contractor, they save mondo money on not paying you benefits. They're saying they did the same work in the same office and effectively get discriminated against.
If you work through Manpower (as the employee the article listed) you do NOT work for HP and regardless of what work you do there you are NOT owed benefits/compensation from them.
You work for Manpower and should be arguing with THEM for better pay and benefits more in line with your current working conditions.
Around here (BC, Canada) an employee is one who
For labour relations and tax reasons some employers try to put employees on the books as consultants or contractors, but their financial auditors (it's not GAAP), revenue canada auditors (it may be tax evasion), and the labour relations board smack them down pretty fast.
(std disclaimer: IANAL, IANAA, if you need a lawyer or accountant, get a real one)
As I recall, a similar situation used to (does?) exist at Microsoft -- people could stay as contractors for years in the same position. They got none of the perks and benefits, and were effectively second-class citizens (or so I've heard, I've never even been to Washington State).
All true.
The result is that contractors at Micorsoft NOW can only work for 12 months and then are required to leave the contract for 100 days, before they can be rehired to work on the contract for another 12 months.
There are a whole bunch of contractors working that way at Microsoft's support center in Charlotte, NC.
One of my current co-workers has been through the cycle twice and is going back again in May.
Goofy, Geeky Gifts and More!
Employment law supercedes contracts quite often. you can't contract for something that is illegal, and it is illegal to treat people in certain ways, even if they agree to it in writing.
If the employment terms can't pass certain tests that distinguish them (the contractors) from the regular employees, then regardless of contract, they are employees and deserve the same benefits that a regular employee enjoys.
If it was simply a contract dispute, you'd have a point. If the argument is that the contract is illegal, or meritless in certain areas, then you don't. And without seeing the contract, and the full text of the labor laws of Idaho, speaking from knowledge based on osmosis from your wife is slightly ill-advised.
You can draw up whatever kind of contract you want, but there will always be two issues to deal with:
1) No matter how the company defines "contractor," the IRS has it's own guidelines determining who is or isn't a contractor.
2) If your employer ever makes demands beyond what's outlined in the contract, then there's a rather severe power imbalance when it comes to negotiations.
A friend of mine ran into this problem. She was a contractor, and as her contract was approaching time for renewal, her employer began to demand that she be in the office during certain hours rather than working from home. Since her work didn't require her to be in the office, this was clearly illegal but the message was was quite clear: do this, or your contract doesn't get renewed. With contractors, a company can keep doing this until it finds someone willing to play ball.
I think lawsuits like this are a good thing because they provide some credible deterrent for this kind of behavior. Without the threat of such lawsuits, there's no serious disincentive against abusing the rules surrounding independent contractors, and the rules become effectively worthless.
That's retardulous. That's not the case at all. You are a contract worker (aka independent contractor) when you sign a contract saying so. It has nothing to do with responsibilities or deadlines.
And the determination of what is an employee is set by the federal government, including IRS guidelines, labor guidelines, tax code, and congressional laws. State laws may provide certain benefit to non-employees, but that doesn't make them an employee.
When you sign a contract, you are agreeing that you will do X amount of work (hours, units, a project) for Y amount of money (whether flat or per hour). Often, other responsibilities such as work hours are specified in the contract, or there's a clause stating that the employer will decide those terms.
As a contract worker, you are not entitled to any benefits whatsoever. Under some cicumstances, the "employer" doesn't pay payroll taxes, and you are responsible for all taxes, because you are effectively self-employed. My father got swindled into this as a dealer rep for an auto auction in the 80s. The owner of that auction eventually went to prison for tax evasion and ghost employment (big surprise).
And yes, if you plan on working as a contract worker, get an attorney to look over the contract. It'll cost you some (it cost my former roommate $150), but is well worth it. Not just any attorney, though, an employment attorney.
IT people need to read about how law affects them. I've always found that Nolo has great books for us non-lawyers. Those in IT would be most interested in this book, which provides guidance on these issues for both employers and employees.
So this person voluntarily entered into a contract with HP (well, with a subcontractor of HP), with the understanding that she would be paid X dollars in exchange for Y hours work, with no additional compensation expected on either side. Fast forward a couple years and now we're supposed to let her renegotiate the contract BACKDATED TO THE START because she's changed her mind?
But a contract isn't valid if it requires a law to be broken. And in all states in the U.S., you can't just call someone a contractor and have that be the end of it -- every state has there own checklist of what is a contractor and what isn't. Just because you have someone sign a contract saying they are a "contractor" doesn't mean that contract is valid -- they actually have to meet the test to be a contractor.
It's like the whole exempt versus non-exempt worker -- employers like to classify workers as exempt, so they don't have to pay them overtime. But the laws don't let the employer decide who gets overtime and who doesn't -- there are a set of rules that define what the duties of an exmpt employee are, and if an employee doesn't meet that test, then classifying them as exempt is against the law, and any contract specifying otherwise is void.
Now, who knows if these contractors who are suing meet the Idaho definition of contractor or not -- but the whole idea that a contract is the be-all-end-all is incorrect.
"That's not even wrong..." -- Wolfgang Pauli
Actually, this particular lawyer is well known and respected in the state. He is a former Idaho Supreme court member, and also was a Democrat candidate for governor in '98.