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Volt Asks Temps To 'Vote" For Microsoft Pay Cut
theodp writes "In an email sent Friday evening to its Microsoft temp workers, Volt Workforce Solutions asked the techies to 'vote' to agree to a 10% pay cut. From the email: 'We want to support you in continuing your assignment at Microsoft and respectfully ask that you respond by going to the upper left hand corner of this email under the "Vote" response option and select, "Accept'" by close of business Tuesday, March 3, 2009. By accepting you agree to the [-10%] pay adjustment in your pay rate.' Microsoft managed to keep the Feb. 20 email detailing plans to slash rates from leaking while it pitched its Elevate America initiative at the 2009 Winter Meeting of the National Governors Association, touting Microsoft skills as just the ticket to economic recovery."
The email stated "this is mandatory in order to continue your assignment at Microsoft ". So voting yes just means you want to keep your job.
That's because management deserves it. We make the big decisions and take the risks that enable the company to succeed.
Probable AC troll, so I won't waste time on most of it.
It's a good opportunity however, to point out that the problem with capitalism in recent years has been that the management have *not* been exposed to risks despite having been paid accordingly. They've worked themselves into the ludicrous position where they get paid bonuses regardless of whether they succeed or not.
They're generally are the *last* people to be exposed to the results of their failure, assuming that they haven't been astute enough to move on before the results of their short-term, shareholder-pleasing actions become evident.
Even when they're kicked out due to extreme incompetence, they'll still end up with comfortable payoff or at worst what they managed to get out of the company beforehand.
"Slashdot - News and Chat Sites Deviant". (Click "homepage" link above for details).
It's one thing to cut salaries when you're hemorrhaging. It's another to cut salaries when everyone else is hemorrhaging, and you have a stable, monopoly-protected revenue base, just because your workers have no alternative.
Hate to say it, but that's exactly why. The cost of labor is dropping, because there's a massive pool of it willing to work for less right now. Market forces and all - more supply, less demand, price drops.
Sure, it was awesome for us all during the .com boom because it was the other way around (demand outstripping supply, causing outrageous salaries, etc.), but the point is stop your bitching when it goes the other way. That's just the way an open market works.
If insufficient numbers of people vote for a pay-cut, they _will_ be in the position of having to do layoffs, and in all likelihood, the people who will get laid off in such a case are the people who the company best figures it can replace with a more cost efficient alternative (read as: new graduate willing to accept a lower rate of pay). They can get away with this quite legally as long as they pay adequate severance packages.
How a person votes would likely not affect whether or not they got laid off, should a mass layoff occur, and it would really bite for the individual who voted that they would take a pay cut to get laid off anyways because not enough people voted that way, but hey.... nobody ever said life was fair.
But by all rights, Microsoft _should_ be conducting this vote anonymously... so that they have no means of knowing which employees voted no and which voted yes, because if they don't and they only lay off people who voted "no", then they could be setting themselves up for a large number of constructive dismissal lawsuits... (and what's worse for them is that the employees would have an official paper trail to prove it!). Further, by conducting the vote anonymously, Microsoft would be publicly presenting the notion that they are genuinely trying to come up with methods of retaining their employees in hard economic times because they value them all, rather than simply terminating the ones who don't vote the way they want.
File under 'M' for 'Manic ranting'
In this case it is far worse. This is a 10% cut in the rate to the employment agency, so they have to cut the employees wage even further, on costs, insurance, profit etc, employees themselves are likely to get around double that cut.
I see that you have some problem with economics. Reduced pay for employees results in reduced spending, which generates lay-offs. A lot of people base their debt payments upon the salary level with out much gap between them. A 20% pay cut will often result in bankruptcy, as the employees can not just whip up a quick letter telling their creditors they will now be paying them 20% less and if they don't like it, they wont pay them anything.
Now is the pay cut to enable M$ to survive or is it to allow M$ to maintain it's current profit margin or even increase them. M$ has a history of having a total disregard for the costs of it's actions upon other people and companies as long their own profits keep increasing.
Chaos - everything, everywhere, everywhen
I am a contractor at Microsoft right now subject to this pay rate decrease. Although I have my opinions about why it is happening, and what should be happening instead, I think more interesting is what the immediate effect of this will be. In my case, I cancelled several services I pay for in order to absorb the hit to my income and will be increasing my W-4 deductions to maximize my current income (up to my allowed amount) in favor of decreasing my tax return next year (here's to hope).
But, I cancelled Netflix who licenses Microsoft's streaming video technology. I cancelled Gamefly who previously rented me Xbox 360 games. I will be providing less revenue through withholding to the federal government. There will be less discretionary spending and less revenue provided to my local and state government, all of whom need it just as bad as we do right now. All of those organizations rely on Microsoft products for their dwindling operations. In a very real way (since I live in northwest Washington) there will be less money for police to protect Microsoft's physical assets.
Don't these circular relationships represent the defintion of a "downward spiral"? Are we sure we understand the impact of these actions?
In the meantime I will buckle under and keep working my ass off. My kid's doctor doesn't accept righteousness as a form of payment.
Nope. The longer someone avoids paying off their debits, the bigger the debt becomes (thanks to the wonder of compound interest). Then, when their interest rate goes up (as it must, since rather than reduce debt, they've increased it and become a higher risk), you get a second whammy.
If nobody had debt, all earnings could be spent on direct consumption, without some (a lot, in many cases) being bled off by interest payments.
We've just come to the end of a very unnatural cycle - one where people not just continually rolled over debt, but also threw in additional debt with every roll-over, to the point where they were using new debt as their chief way of making debt payments (that's what average spending of 103% of income really means - people are using their credit cards to make payments on their cars and mortgages).
Deflation? After a decade of overinflated housing, we NEED a decade of housing deflation, just to get back to historic norms.
Bail-outs? Why bother - this just rewards the greedy, penalizes the prudent, and shows that nobody in government knows the meaning of "keep your powder dry". All the bailout money is not just a waste - it also carries the hidden cost of missed opportunities to both rationalize the car and banking industries, and to invest elsewhere. Every dollar spent out bailing crooks is a buck taken away from schools and infrastructure and retraining - money that could BUILD the economy.
For those who eschewed debt, delaying gratification, deflating prices back down to historic norms brings the reward of buying at proper value, not bubble prices. Call the bailouts what they are, a global "tax on stupdiity and greed."
I agree, but the cap gains tax should only be on real profits over $500 per year taken as income and not reinvested. Now you pay on purely nominal gains caused by inflation, fill out onerous paperwork over tiny amounts of savings account interest, usually can't deduct all investment losses from profits, and usually take a tax penalty for rebalancing your portfolio. Investment companies don't have most of these burdens, but individuals do. Getting around the ridiculous rules is a big part of why the market is dominated by mutual funds, hedge funds, IRA money-jailers and other parasites.
Inflation-adjusting nominal capital gains using the government's numbers isn't good enough. The have been fiddled with so much over the years that they are 3 to 6 percentage points lower than they would be when calculated using the methods of 15 to 30 years ago. This fiddling has also inflated GDP growth and screwed Social Security recipients by a similar percentage compounded over many years.
Also, capital gains shouldn't be taxed if the underlying capital is intellectual property. Ireland got that right; it really paid off for them. (I know this is Slashdot, but individual authors and inventors would be more viable if their product weren't taxed out of existence.)
"Is life so dear, or peace so sweet, as to be purchased at the price of chains and slavery?" - Patrick Henry