The article itself acknowledges that the ratio of contractors to employees at Google isn't out of the ordinary for SV companies and my personal experience is that it isn't unusual for large companies outside of SV. Even in the unfortunate case sited in the article of the contract employee that was sexually harassed once a complaint was filed Google fired the FTE responsible for the harassment and negotiated a settlement with the contract employee.
So my question is why was the article written? If it were to highlight the use of contract employees vs FTEs, why write it just about Google when it is an issue affecting the workforce across industries? Why throw out the case of the harassed employee but leave the information that Google fired the harasser when a complaint was filed until much further in the article when many readers will have stopped reading? This article strikes me as a Google hit piece.
> why write it just about Google when it is an issue affecting the workforce across industries?
There is already a general discussion around employees vs. contractors in the American economy. Showing a large, profitable technology company doing the same bolsters the case that this is a systemic problem.
Also, the article mentions that “high-tech companies have long promoted the idea that they are egalitarian, idyllic workplaces. And Google, perhaps more than any other, has represented that image, with a reputation for enviable salaries and benefits and lavish perks.“
The most interesting part of all of this, is that when SV companies soft-brag about their high average salaries, they leave out all the contractors contributing significant work.
You just described a systemic issue with SV companies replacing FTE with contractors, then ask why someone would write an article about that?
How many companies should the article have included to not be considered a "hit piece"? Or do you just consider any article about one company a "hit piece"?
Because almost any other entity could claim it's economic pressure and financial reality.
Google is sitting on Fort Knox, they're one of the most cash flush companies in thew world ... and they can't be bothered to actually hire people.
At the last G event, Sundar brought out this hyperbolic weeping montage about how their AI helps poor people in India 'read' the cooking directions on food labels, even when they are illiterate (i.e. AI text to voice).
It was gushy and pulled hard on heartstrings.
Well then why can't they just hire people and treat them as human equals?
It's beyond hypocritical.
With a little bit of cynicism, it's understandable from a business perspective - hey, it's money.
But what irks me is the elements of 'social justice' coming out of these entities while they're blind to the very social ills that they are driving.
People wonder why we have inequality, or 'housing affordability' etc. - well - this is it.
Folks in the Valley seems to be stoked to solve big problems and work on 'AI' - while kind of ignorant to the fact there are trailer parks all over the Valley. Which is mind blowing.
It’s because there are some employees in the company agitating about it. As other commenters have noted, articles about Google get a lot of play from the public. Disgruntled insiders seem to have a strong conduit to the media and this is the latest controversy de jour that these activists have groused about. The reporters happily lap it up, and another knock at Google makes it to the front page of this site.
>If it were to highlight the use of contract employees vs FTEs, why write it just about Google when it is an issue affecting the workforce across industries?
Because this article is about Google. Why doesn't every book or article cover every subject, all the time?
Google is a major, global brand, widely-recognized as one of the "best places to work". Seems like a good focus of investigation to me.
>This article strikes me as a Google hit piece.
You can't talk about anything anymore without it being a "hit piece", or "fake news", or an "attack", or "astroturfing", or written by "paid shills". I guess people are more comfortable when they can simply dismiss any topic they disagree with.
I think its trying to point out that companies are increasingly relying on non-FTE positions. Why they are doing it is obviously about benefits. I don't work for Google but I do work for a massive international company and on my team there are three FTE positions and over twenty contractors. For daily work there is no difference. However as an FTE I get the usual benefits along with a pretty nice training budget for personal development, very generous PTO and extra time off. Most of the contractors will have their contracts renewed until they move on somewhere else or an FTE position opens and they get that. So essentially companies are using temp and contract resources to avoid the cost of having what they need as FTE positions.
This is a bit curious. The large number of contractors can be seen as the victims here. They don't have power or privilege as other employees and yet those who see nothing wrong with it are not arguing their point but claiming persecution and victimhood on Google's behalf.
Its troubling to see this immediate rush to claim persecution and victimhood by those who have power.
> The article itself acknowledges that the ratio of contractors to employees at Google isn't out of the ordinary for SV companies and my personal experience is that it isn't unusual for large companies outside of SV.
I was a contractor at Google and I thought they treated me VERY well, with most of the perks that come with the office (food, activities, music room, gym, etc). They even let me work on a 20% project during office hours.
Then I got a new manager, new policies were enacted, they canned my project, and they took away my access to Memegen. Memegen was the last straw, so I left.
Anyway, Google had good reason to use contractors. Their hiring standards and policies makes it extremely difficult and costly to hire people, and many jobs there typically only have a retention rate of about 9-12 months, or just isn't "involved" enough to demand a FTE position, or needs to be scaled up more quickly than they can hire for. It just isn't worth it to go through the full Google process for jobs like that.
Why is this newsworthy? Genuine question. The article (I did read it!) doesn't seem to articulate why exactly this is a problem.
I think (happy to be convinced otherwise) it is ok for a company to have more temps than employees or vice versa. What does it matter? Is there a US cultural/social nuance that I'm missing?
Lower paychecks (75-80% of hourly rate of full-time workers), little to no benefits (like healthcare coverage), harder to keep track of for taxation purposes, harder to object to inhumane conditions like exploitative working hours or sexual harassment (since you're seen as a "guest" instead of an employee, complaining to the HR will usually result in you simply being discarded and replaced by someone else who won't complain) etc.
Note: I wrote this as a general trend, which does not mean this applies to Google specifically.
Another anecdote: Local friend works for Google in Asia. She is basically forced to relocate to SF for 1-3 years and work at a rather low salary (for SF standards) there on something unrelated to her current job.
I would suspect that part of the reason for such a "program" is to save on wages, which would be much higher for locally-hired staff. Her field is admin/marketing. Should be easy enough to find local talent for that. At a higher price.
I'm sure there are upsides to this exchange program, but having no real choice (except quitting) and working at a lower salary don't leave the best impression.
This is a natural and expected consequence of tax law - specifically provisions in ERISA, which sets out the rules for 401(k) plans.
Google wants their 401(k) to be as efficient and useful as possible for their employees, which tend toward being highly-paid engineers and other professionals. ERISA has some fairness provisions, which means that all employees must be subject to the same plan rules, and the plan must pass certain tests of "highly-compensated" employee participation limits compared to non-highly-compensated ones.
So if you have a bunch of engineers and some janitors, and you offer a large 401(k) match that engineers use and value and janitors don't, you wind up having to unwind some of the engineer contribution and matching in order to keep things "fair".
But, crucially, ERISA doesn't have say anything about who has to be an "employee" versus hired on as a contractor. So all the janitors and cafeteria workers become contractors, and now your 401(k) plan counts junior developers as the "non highly-compensated" comparison class, and your 401(k) plan passes muster again.
This affects Google a lot because their retirement plan is highly optimized for allowing highly-paid employees to save a ton of money in a tax efficient manner. It'd be difficult to craft a better plan, and from what I've heard they've even automated using a niche tax loophole as well ("mega-backdoor Roth" - after-tax 401(k) contribution followed by immediate Roth conversion, basically allows an extra $20k/yr or so in Roth contribution room).
To be fair to Google every company in every industry is doing this more and more. It's one of the first things that happens when a merger or private equity takeover happens- aggressively purge full time and move to temp workers for all non-core services to save some money.
Of course the companies that pay more attention to data do this more extensively and aggressively, why wouldn't they?
The army of temp workers/janitors/contractors/uber drivers convene and sleep in the same parking lots at night. It's a whole community of a semi-permanent underclass drifting around, saving the spreadsheets a few points here and there.
In related news, I'm not sure I want to be an American anymore. This is not the country I grew up in.
The big company I work for isn't doing what you said. They acquired a big company last year. They also have multiple business units which are being merged. Still not aggressively changing full time employees, nor changing roles into temp ones. They have recently starting to insource some of the IT again (less IBM).
What's the induction process like for a temp at Google? I'm curious as I've heard stories of temps becoming subject matter experts on teams and carrying projects across the line. If said individuals couldn't get into Google as a full-time employee what would that then say about the way Google interviews?
I worked as a contractor on a Google backed company on the Google campus. My interview consisted of a short meeting at the gentleman who ran the agency's house. I found the opportunity through an online consulting marketplace. I then and showed up to the Google site the next week and began working. I also applied directly, but have never heard back from them. My most striking memory was the complete lack of connection to the outdoors. Every single window and skylight was covered with light blocking coverings, you never knew if it was night, day, sunny or stormy outside. Other than that it was fascinating work with great people.
They interview the temps the same way they interview a FTE but if the project has no open req they pay a temp agency to actually employ the person.
Temps are technically not permitted to supervise actual FTEs but in practice some do so.
Temps don’t make as much as FTEs. So there’s an incentive to do this and also to terminate the contract (legal reasons) rather than hire them, which means the institutional knowledge goes elsewhere.
The issue with that at the time was that Microsoft was using temps to avoid paying payroll taxes. Ironically the IRS wised up to this tactic because of just how good Microsoft was treating their temps, i.e. the same as regular employees.
Now the issue is a company is using temps to hold down the market rate for salary. Less about tax avoidance, and more about wage suppression. Of course it’s also a valid argument to say the Supreme Court decision at the time made it more likely for companies to choose this route.
Given the whole problem with platform economies (e.g. Uber drivers), perhaps it's better if the distinction between contractor and employee becomes smaller. E.g. healthcare benefits, separate them from the employer and make them the same for everybody.
Is it possible for a temporary employee to be promoted to full time status, or is that impossible? What is the average length of employment for a temporary employee vs that of a full timer? Just asking.
I was a contract worker for a similar scale web company and I was offered a full time role after 12 months of working there. I declined it because the day rate that I was on was more than the full time salary. The perks (stock, parental leave and other benefits) were significant but I didn't want them as they didn't apply to me. I preferred to keep my own autonomy and didn't think the future was going to work out well for the team I was in. The team had constant squabbles and moral was low. If you're willing to accept risk like that you can make good money as a senior contracting engineer. Full timers heads exploded when I declined the offer but I hated the self created heirarchy that the contractor/FTE relationship posed. It seemed like there were two set of rules, one for ftes and one for contractors. I think it's a really toxic way to run your company.
I have known plenty of white collar contractors be converted to full-time. Note that this isn't a promotion technically, but rather, a change of employer. They're going from being employed by a staffing firm to being employed directly by Google. Also note that a lot of the white collar contractors are only 'temporary' at Google itself; they are full-time employees of their staffing firm, and if their gig is up at Google then they'll go on to the next client. They do tend to get benefits like health insurance and retirement accounts, albeit not as good as the ones offered directly by Google.
Also note that this path is only available for white collar workers. There aren't any full-time positions available for janitors, cafe workers, security guards, etc., as big companies tend not to employ those positions directly as it's outside their wheelhouse.
Yes it's possible and a lot of teams try to convert their temps into full-time employees.
A conversion requires interviews (2-3). Candidates usually get statements of support from their team colleagues, which has quite an impact during the hiring committee discussion.
E.g. I'd reckon it's easier passing via the tvc->fte route.
I'm not in the US, but working for an American company, I started as a contractor from a big firm 2 years ago, I'm starting next week as a FTE (with a 20% salary increase). During that time, two other contractors were hired and the rest (a dozen out of the 60 people in our office) had their contract not renewed as some project were moved to other offices/finished.
Here, there was no difference on how FTEs and contractors were treated (including company outings, which was very nice) with team composed of both FTEs and contractors. This situation is close to illegal here (I think) as contractor are supposed to be brought only for a specific job that can't be done by a FTE; but since it worked for everyone, no-one is complaining.
Sure, why wouldn't it be? Part time is not a status, it's just a different contract.
Maybe you're confusing temps with employees though; in that case, it is possible but the temp agency will demand a fee. It works the same with consultants, for who the fee will be much higher (think 2-3x their annual wage).
I'm going through this process right now, I have a contract for a SWE role at Google through a contracting company. Interestingly enough I was offered no benefits.
I guess it would depend quite heavily on location - particularly re. tax and employment regulation. For example, in London, a lot of the good people historically went the contracting route due to much higher rates and lower taxes. Big banks were (and are) staffed with a lot of contractors who were very happy not to be on payroll.
Depends on project work vs. ops. Big institutions will hire an army of contractors to complete the task.
In one case I was in, the project had about 350 people, probably 75% contractor. At the midpoint of the project (year 2/5) they started attrition of contractors, and landed at around 100 people (10-15% contractor) at the end.
Why? It’s hard to hire at the levels you need and then get rid of them in a big company.
It may vary by team, but I've never seen a contracted out SWE, SRE, or any other highly technical position -- unless you want to count the web developer employees of design agencies who are contracted to make one-off marketing websites (i.e. not core products), but their jobs seem pretty cushy. They don't even come onsite anyway.
Interns usually work for small periods of time between school cycles. They get interesting projects, because internships are effectively a recruiting tool for new grads.
With the amount of prep work and oversight/mentorship that goes into an internship, it's not obvious that they benefit the company outside of recruiting.
If the argument is "TVCs tolerate more because they fear retribution/loss of access to a full-time role," that might happen for interns too. (I haven't studied either group, so I'm not qualified to say.) If the argument is that "TVCs are being exploited to minimize the number of full-time roles," that definitely doesn't apply to interns.
[+] [-] tssva|6 years ago|reply
So my question is why was the article written? If it were to highlight the use of contract employees vs FTEs, why write it just about Google when it is an issue affecting the workforce across industries? Why throw out the case of the harassed employee but leave the information that Google fired the harasser when a complaint was filed until much further in the article when many readers will have stopped reading? This article strikes me as a Google hit piece.
[+] [-] JumpCrisscross|6 years ago|reply
There is already a general discussion around employees vs. contractors in the American economy. Showing a large, profitable technology company doing the same bolsters the case that this is a systemic problem.
Also, the article mentions that “high-tech companies have long promoted the idea that they are egalitarian, idyllic workplaces. And Google, perhaps more than any other, has represented that image, with a reputation for enviable salaries and benefits and lavish perks.“
[+] [-] josephjrobison|6 years ago|reply
So instead of the average Google compensation being $144,652 (https://www.infoworld.com/article/3304439/man-or-myth-the-3-...), it could be 30-50% lower if you account for contractors.
But an average Google compensation of $80,000 (for example) wouldn't be a good recruiting tool.
[+] [-] Goronmon|6 years ago|reply
You just described a systemic issue with SV companies replacing FTE with contractors, then ask why someone would write an article about that?
How many companies should the article have included to not be considered a "hit piece"? Or do you just consider any article about one company a "hit piece"?
[+] [-] C1sc0cat|6 years ago|reply
[+] [-] sonnyblarney|6 years ago|reply
Because almost any other entity could claim it's economic pressure and financial reality.
Google is sitting on Fort Knox, they're one of the most cash flush companies in thew world ... and they can't be bothered to actually hire people.
At the last G event, Sundar brought out this hyperbolic weeping montage about how their AI helps poor people in India 'read' the cooking directions on food labels, even when they are illiterate (i.e. AI text to voice).
It was gushy and pulled hard on heartstrings.
Well then why can't they just hire people and treat them as human equals?
It's beyond hypocritical.
With a little bit of cynicism, it's understandable from a business perspective - hey, it's money.
But what irks me is the elements of 'social justice' coming out of these entities while they're blind to the very social ills that they are driving.
People wonder why we have inequality, or 'housing affordability' etc. - well - this is it.
Folks in the Valley seems to be stoked to solve big problems and work on 'AI' - while kind of ignorant to the fact there are trailer parks all over the Valley. Which is mind blowing.
[+] [-] tempWWWW|6 years ago|reply
[+] [-] navigatesol|6 years ago|reply
Because this article is about Google. Why doesn't every book or article cover every subject, all the time?
Google is a major, global brand, widely-recognized as one of the "best places to work". Seems like a good focus of investigation to me.
>This article strikes me as a Google hit piece.
You can't talk about anything anymore without it being a "hit piece", or "fake news", or an "attack", or "astroturfing", or written by "paid shills". I guess people are more comfortable when they can simply dismiss any topic they disagree with.
[+] [-] observer12|6 years ago|reply
[+] [-] nova22033|6 years ago|reply
[+] [-] throw2016|6 years ago|reply
Its troubling to see this immediate rush to claim persecution and victimhood by those who have power.
[+] [-] PhasmaFelis|6 years ago|reply
Just because it's common doesn't mean it's okay.
[+] [-] funkjunky|6 years ago|reply
Then I got a new manager, new policies were enacted, they canned my project, and they took away my access to Memegen. Memegen was the last straw, so I left.
Anyway, Google had good reason to use contractors. Their hiring standards and policies makes it extremely difficult and costly to hire people, and many jobs there typically only have a retention rate of about 9-12 months, or just isn't "involved" enough to demand a FTE position, or needs to be scaled up more quickly than they can hire for. It just isn't worth it to go through the full Google process for jobs like that.
[+] [-] wutbrodo|6 years ago|reply
Like many things about the way Google was run, I really didn't appreciate Memegen enough until I left.
[+] [-] CydeWeys|6 years ago|reply
[+] [-] plinkplonk|6 years ago|reply
I think (happy to be convinced otherwise) it is ok for a company to have more temps than employees or vice versa. What does it matter? Is there a US cultural/social nuance that I'm missing?
[+] [-] r3bl|6 years ago|reply
Note: I wrote this as a general trend, which does not mean this applies to Google specifically.
[+] [-] m3nu|6 years ago|reply
I would suspect that part of the reason for such a "program" is to save on wages, which would be much higher for locally-hired staff. Her field is admin/marketing. Should be easy enough to find local talent for that. At a higher price.
I'm sure there are upsides to this exchange program, but having no real choice (except quitting) and working at a lower salary don't leave the best impression.
[+] [-] 9nGQluzmnq3M|6 years ago|reply
[+] [-] ThrustVectoring|6 years ago|reply
Google wants their 401(k) to be as efficient and useful as possible for their employees, which tend toward being highly-paid engineers and other professionals. ERISA has some fairness provisions, which means that all employees must be subject to the same plan rules, and the plan must pass certain tests of "highly-compensated" employee participation limits compared to non-highly-compensated ones.
So if you have a bunch of engineers and some janitors, and you offer a large 401(k) match that engineers use and value and janitors don't, you wind up having to unwind some of the engineer contribution and matching in order to keep things "fair".
But, crucially, ERISA doesn't have say anything about who has to be an "employee" versus hired on as a contractor. So all the janitors and cafeteria workers become contractors, and now your 401(k) plan counts junior developers as the "non highly-compensated" comparison class, and your 401(k) plan passes muster again.
This affects Google a lot because their retirement plan is highly optimized for allowing highly-paid employees to save a ton of money in a tax efficient manner. It'd be difficult to craft a better plan, and from what I've heard they've even automated using a niche tax loophole as well ("mega-backdoor Roth" - after-tax 401(k) contribution followed by immediate Roth conversion, basically allows an extra $20k/yr or so in Roth contribution room).
[+] [-] oldjokes|6 years ago|reply
Of course the companies that pay more attention to data do this more extensively and aggressively, why wouldn't they?
The army of temp workers/janitors/contractors/uber drivers convene and sleep in the same parking lots at night. It's a whole community of a semi-permanent underclass drifting around, saving the spreadsheets a few points here and there.
In related news, I'm not sure I want to be an American anymore. This is not the country I grew up in.
[+] [-] bkor|6 years ago|reply
[+] [-] tjpnz|6 years ago|reply
[+] [-] iancmceachern|6 years ago|reply
[+] [-] gumby|6 years ago|reply
Temps are technically not permitted to supervise actual FTEs but in practice some do so.
Temps don’t make as much as FTEs. So there’s an incentive to do this and also to terminate the contract (legal reasons) rather than hire them, which means the institutional knowledge goes elsewhere.
[+] [-] jamesfe|6 years ago|reply
[+] [-] Bucephalus355|6 years ago|reply
Now the issue is a company is using temps to hold down the market rate for salary. Less about tax avoidance, and more about wage suppression. Of course it’s also a valid argument to say the Supreme Court decision at the time made it more likely for companies to choose this route.
[+] [-] amelius|6 years ago|reply
[+] [-] AJ007|6 years ago|reply
[+] [-] huffmsa|6 years ago|reply
[+] [-] MichaelMoser123|6 years ago|reply
[+] [-] drcross|6 years ago|reply
[+] [-] CydeWeys|6 years ago|reply
Also note that this path is only available for white collar workers. There aren't any full-time positions available for janitors, cafe workers, security guards, etc., as big companies tend not to employ those positions directly as it's outside their wheelhouse.
[+] [-] hknd|6 years ago|reply
A conversion requires interviews (2-3). Candidates usually get statements of support from their team colleagues, which has quite an impact during the hiring committee discussion.
E.g. I'd reckon it's easier passing via the tvc->fte route.
[+] [-] baud147258|6 years ago|reply
Here, there was no difference on how FTEs and contractors were treated (including company outings, which was very nice) with team composed of both FTEs and contractors. This situation is close to illegal here (I think) as contractor are supposed to be brought only for a specific job that can't be done by a FTE; but since it worked for everyone, no-one is complaining.
[+] [-] syn0byte|6 years ago|reply
Sure it happens, but it's mostly to string along suckers.
[+] [-] Cthulhu_|6 years ago|reply
Maybe you're confusing temps with employees though; in that case, it is possible but the temp agency will demand a fee. It works the same with consultants, for who the fee will be much higher (think 2-3x their annual wage).
[+] [-] luckylion|6 years ago|reply
[+] [-] kdot|6 years ago|reply
[+] [-] dfilppi|6 years ago|reply
[+] [-] Manjuuu|6 years ago|reply
[+] [-] jsty|6 years ago|reply
[+] [-] Spooky23|6 years ago|reply
In one case I was in, the project had about 350 people, probably 75% contractor. At the midpoint of the project (year 2/5) they started attrition of contractors, and landed at around 100 people (10-15% contractor) at the end.
Why? It’s hard to hire at the levels you need and then get rid of them in a big company.
[+] [-] CydeWeys|6 years ago|reply
[+] [-] firemancoder|6 years ago|reply
[+] [-] matz1|6 years ago|reply
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[+] [-] beezlebubba|6 years ago|reply
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[+] [-] avefilip|6 years ago|reply
[+] [-] bsimpson|6 years ago|reply
Interns usually work for small periods of time between school cycles. They get interesting projects, because internships are effectively a recruiting tool for new grads.
With the amount of prep work and oversight/mentorship that goes into an internship, it's not obvious that they benefit the company outside of recruiting.
If the argument is "TVCs tolerate more because they fear retribution/loss of access to a full-time role," that might happen for interns too. (I haven't studied either group, so I'm not qualified to say.) If the argument is that "TVCs are being exploited to minimize the number of full-time roles," that definitely doesn't apply to interns.