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Microsoft Businesses

Volt Asks Temps To 'Vote" For Microsoft Pay Cut 412

Posted by kdawson
from the one-contractor-one-vote dept.
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."
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Volt Asks Temps To 'Vote" For Microsoft Pay Cut

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  • by mc1138 (718275) on Sunday March 01, 2009 @03:50PM (#27032557) Homepage
    You can vote anyway you want, the only catch is that there is only one choice.
    • Re: (Score:3, Insightful)

      by pxlmusic (1147117)

      wolves, chickens, and all that

    • by plopez (54068)

      In Soviet Socialist Corporate America....

      Or should that be "in Fascist Capitalist Corporate States of America" you are free to do as you are told.

      Though with corporate bailouts and nationalization it's getting hard to tell them apart anymore.

    • by Cally (10873) on Sunday March 01, 2009 @04:29PM (#27032957) Homepage

      HP / EDS pulled the same stunt. Oh, except that the CEO's taking a 20% cut in his basic (but pulled a $40,000,000 bonus last year), and there's no vote involved.

      http://go.theregister.com/feed/www.theregister.co.uk/2009/02/19/hp_pay_cuts/ [theregister.com]

      • by QuasiEvil (74356) on Sunday March 01, 2009 @05:55PM (#27033807)

        FedEx did it too, about two months ago. CEO took a 20% cut, various levels of management took 7.5-10%, and everybody else (well, everybody salaried, aka me) took 5%. The bigger hurt was the suspension of the 401k match.

        Still, honestly given the economy, I'd rather see this than layoffs. Not that there aren't people I'd like to see gone, but that needs to come as part of the normal, "You're a moron/sloth, go pursue other career opportunities" methods. Layoffs always seem to get 75% of those people, and another 25% that were invaluable but pissed off the wrong person.

        The more layoffs we get, the further down the bottom of this thing is going to be. So, given that a company's options are lay some people off or just make everybody take a little pain for the collective good, I'll take the collective pain right now. I think it's better for the economy as a whole.

        • by rtb61 (674572) on Sunday March 01, 2009 @06:37PM (#27034181) Homepage

          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.

          • by glwtta (532858) on Sunday March 01, 2009 @07:55PM (#27034759) Homepage
            A lot of people base their debt payments upon the salary level with out much gap between them.

            If that's true, then a lot of people are complete idiots. It really doesn't seem logical that employers should factor in their employees' overspending when making these kinds of decisions.
          • Re: (Score:3, Informative)

            by xilmaril (573709)

            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.

            You're right. This is what's going to happen. This is what most people do.

            That said, what kinda idiots do this? Why do so many people believe they shouldn't have any contingency plans in life? Next month, I could be hit by a bus. If I do, I live in Canada, so medical costs will be okay, I have credit card insurance to cover a year of interest payments on that (it only costs me $5/month), and I save enough money that I'll be able to live, if miserably, for at least 6 months. Why don't more people do this? An

          • Re: (Score:3, Insightful)

            by RepelHistory (1082491)
            This sort of thing is going on everywhere. That's why it's a recession. I think it's a little unfair to say that right now it's all Microsoft's fault that they have to cut wages because consumers can't afford their products (not that I'd shill out $150 for Office even in a good economy). It's not like companies can just say, "Wait a minute... if we don't lay people off and/or cut wages... this recession will end!" If that were possible we wouldn't have recessions at all.
    • by commodore64_love (1445365) on Sunday March 01, 2009 @04:33PM (#27033005) Journal

      >>>You can vote anyway you want, the only catch is that there is only one choice.

      That's true. My company has not done this yet, but I've heard from a neighboring company that the temporary Contract workers were told they must take a $10 cut, otherwise next week would be their last. A few stubborn persons refused, and were asked to leave, but most are still working with a reduced pay.

      This "Microsoft vote" is mere formality; if you don't take the cut you may as well pack-up your desk and take a long, unpaid vacation.

      • by Rudolf (43885)

        temporary Contract workers were told they must take a $10 cut

        Ten dollars? How much are they getting paid that a $10 cut hurts?

        Is that per-hour, per-week, or what?

      • by linguizic (806996)
        Honestly, I think this was a better choice than a 10% FTE workforce reduction, and 50% contractor pool reduction like we had where I work. The layoffs we went through recently were really heartbreaking and since we're in CA, there's little chance of these folks getting a job soon. I would have gladly given up 10% of my pay to have kept some of these people on, ESPECIALLY since keeping them on would mean we were more competitive with the other company that shares our market space.
      • Re: (Score:3, Insightful)

        by msobkow (48369)

        I'm starting to think the economy is just an excuse for pay cuts. Last I'd heard Microsoft was still making a very healthy profit.

        I've been through the forced reductions myself, but it was while I was contracting for JPMC, and our cuts were based on the post-Y2K "economy." The only ones who should have been hit with the cuts were the mainframe COBOL programmers who no longer had Y2K work to do, but everyone got hit. A couple contractors quit rather than take the pay cut, but they were by far in the mi

    • by Anonymous Coward on Sunday March 01, 2009 @04:52PM (#27033211)

      The choices should have been:

      1) I do not accept a pay cut. I understand that Friday will be my last day of employment, however, I do not go out much and do not have many friends.

      2) YES, please CUT MY PAY. Management at both Microsoft and Volt should be commended for their tough minded leadership during hard economic times. THANK YOU SIRS PLEASE GIVE ME ANOTHER!!!

    • by mark-t (151149) <markt@@@lynx...bc...ca> on Sunday March 01, 2009 @06:04PM (#27033899) Journal
      Actually, it's probably slightly more than that.

      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.

      • by Vellmont (569020) on Sunday March 01, 2009 @07:36PM (#27034619) Homepage


        If insufficient numbers of people vote for a pay-cut, they _will_ be in the position of having to do layoffs,

        Nowhere did I see that this was a binding vote. I'd say it's more of a straw poll for Volt to see if they can get away with this. For instance, where did they come up with 10%?

        Hell, if enough people vote yes, why not increase the cut to 15%? From the other posters comments I'd guess Volt doesn't really care about their employees and will try to squeeze them as much as possible. The "vote" is merely a means to figure out how hard to squeeze.

  • by Jane Q. Public (1010737) on Sunday March 01, 2009 @03:50PM (#27032561)
    that their REAL "Elevate America" plan is to hire 10% more people but pay them 10% less?
    • Re: (Score:3, Insightful)

      by Anonymous Coward

      ...and pay the saved 1% as a bonus to management?

      • Re: (Score:3, Insightful)

        by Herkum01 (592704)

        Isn't this the real American way for the last 10 years? Cut employees or their salaries and give managers a big bonus?

        If you don't think that it is true, look no farther than the republican party when comes to the financial bailouts. They insist that the auto-workers take cuts in benefits and salary. Then they turn around and complain that the government should not be involved in limiting salaries of failed bank executives to 500K. If that is not hypocrisy I don't know what is.

        • Um no. If they were actually trying to legislate a limit on workers' salaries, while fighting legislation to limit executive salaries, that'd be hypocrisy. But they're not.
    • by will_die (586523) on Sunday March 01, 2009 @04:08PM (#27032761) Homepage
      not 10% but 15%. Microsoft is cutting how much is paid for current contracted hires by 10% but future contract hires will be hired at a 15% decrease in amount paid to the contracting company.
      Companies are being forced into it by Microsoft saying sign the paperwork for this change in contract or we will not hire from you when your current contracts are up. Contracting companies can then push the decrease by telling the employee to sign the agreement or you are fired. Most employees are probably hired under the standard right to work so they can be fired for any reason, however most companies have an employee handbook which prevent firing for any reason, so could be a legal fight.
      • by jcr (53032)

        most companies have an employee handbook which prevent firing for any reason

        Say what?

        -jcr

        • by will_die (586523) on Sunday March 01, 2009 @04:38PM (#27033069) Homepage
          Most companies with an employee handbook usually list the reasons and manner that you can or will be fired. US courts have ruled that those consist as a contract, so even though you can be fired by state and federal law "at will" the handbook probably restricts that right. So if he employee handbook lists reasons for firing, they would have to find a way to make "refusing to take a pay cut" something you can be fired for; probably just call it insubordination.
    • Re: (Score:2, Insightful)

      by Megahard (1053072)
      "Elevate America" is their way of saying "up yours".
  • Vote (Score:4, Insightful)

    by ultrabot (200914) on Sunday March 01, 2009 @03:54PM (#27032595)

    "Voting" is a rather hilarious newspeak term for acceptance of a pay cut.

    Not that I see anything particularly wrong with this approach. I find it pretty absurd that a company should be "stuck" with the contract rates it offers. And considering how big salaries in USA are, it's a small miracle that they still manage to make a profit.

    • Re: (Score:3, Interesting)

      by mdwh2 (535323)

      I find it pretty absurd that a company should be "stuck" with the contract rates it offers.

      A contract is a contract ... I'm not sure why not being able to back out afterwards if you change your mind is "absurd" - the whole point of a contract is that you stick with it.

      (Now yes, in this case I suspect that temporary workers have zero rights, so they could easily fire them if they don't accept, but in general, I don't see how it's absurd that people are stuck with contracts that they enter.)

      And considering ho

    • Re:Vote (Score:5, Insightful)

      by ratboy666 (104074) <fred_weigel@NOspam.hotmail.com> on Sunday March 01, 2009 @09:54PM (#27035709) Homepage Journal

      "I find it pretty absurd that a company should be "stuck" with the contract rates it offers."

      Slow down, cowboy! If you engage me, and then decide to stiff me on a contract, I WILL SUE YOU. And I will win. It doesn't matter how long it takes, or even how much it costs me -- it's just business.

      As soon as you announce "You won't be paid", I put down my tools, and walk. Again, it doesn't matter how much I may need the work.

      Why? What other leverage do I have? And, trust me, companies understand. If I didn't stick to my guns, I am afraid that others would start to take advantage of me. This is my protection, ok?

      About the only way I would take less is if mandated by a bankruptcy court.

  • by kandela (835710) on Sunday March 01, 2009 @03:59PM (#27032669)
    Instead of Yes/No the options should have been, in keeping with Microsoft software licensing tradition, Accept/Cancel.
  • volt's cut (Score:5, Interesting)

    by Qrlx (258924) on Sunday March 01, 2009 @04:07PM (#27032739) Homepage Journal

    I worked for Volt at MS for a year. They offer a 401k plan and match a small percentage which is vested after a year. My year ended (MS only lets you stay a year due to the perma-temp settlement, then you have to take a 100-day break), but the Volt match never materialized in my 401k. Volt explained that to get the match I had to work 12 complete months. Sounds like a year, right? No. Since I started in the middle of the month, my first month wasn't a "complete" month, and it didn't count towards matching.

    I told them their policy was BS, since 1 in 30 employees must start on the first day of the month, assuming people's contracts are as likley to start on day 1 as any other day. They didn't respond.

    But the really nice part is today, when everybody on Slashdot gets to read about it.

    • Re:volt's cut (Score:5, Insightful)

      by stox (131684) on Sunday March 01, 2009 @04:09PM (#27032767) Homepage

      I'll bet Volt isn't taking a cut on their obscene margin.

      • Re:volt's cut (Score:5, Interesting)

        by d8ta (610133) on Sunday March 01, 2009 @04:43PM (#27033127)
        My question exactly. When I was contracting at Microsoft, after I had dug up the gig, gone through the interviewing process, arranged a bill rate, and gotten steered by MS' HR area to go through Volt, Volt was proposing to take a 35% margin off the top for a deal that I had put together. Fortunately, I was able to find another "approved vendor" with a much more reasonable margin. I've come across Volt's presence in several other contracting situations, and they've tried to cram down similar margins there too. I hope that the folks actually doing the work at MS have enough contract flexibility and persistence to find a more reasonable subcontracting vendor.
    • by will_die (586523)
      Once did a job interview and almost took a job with a similar type company. They talked about the great health, leave, and retirement benefits and reading the employee book they had them; then in small print at the end they said you only got them after a year.
      Thing was that company only hired people for another company, MCI, and I knew that MCI once a year, right after Christmas, would fire 10% of the work force and that MCI would only allow contracted employees to work between 6-12 months before they h
    • Re:volt's cut (Score:4, Insightful)

      by jalet (36114) on Sunday March 01, 2009 @04:32PM (#27032991) Homepage

      > since 1 in 30 employees must start on the first day of the month, assuming people's
      > contracts are as likley to start on day 1 as any other day

      Considering your explanation above, I doubt any contract starts on day 1, because clearly they don't want to pay, and not starting contracts on day 1 is a way for them to not pay.

  • How about (Score:5, Insightful)

    by esocid (946821) on Sunday March 01, 2009 @04:07PM (#27032743) Journal
    they start sending this email to the upper management in MS and see how many Accept replies they get.

    And since when is something that's compulsory also voluntary?
    • by plopez (54068) on Sunday March 01, 2009 @04:35PM (#27033035) Journal

      Can't do that. You need to pay top dollar for the best talent. Without the best talent you wouldn't get such market winners such as the Zune or the highly profitable X-box, soon to drive Apple, Sony and Nintendo out of the market.

      Just think of where we'd be today without Microsoft Bob or Windows ME. Or Vista.

      Top pay=top talent=best leadership=best products ever. :)

  • Vote No = Lose Job (Score:5, Insightful)

    by racasper (166446) on Sunday March 01, 2009 @04:17PM (#27032847)

    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.

  • Strange! (Score:2, Funny)

    by brennz (715237)
    I thought Microsoft only hired via the H1-B visa scam?
  • This is a farce (Score:4, Informative)

    by n00btastic (1489741) on Sunday March 01, 2009 @04:49PM (#27033183)
    A large portion of their contractors are really contracted through temp companies. For example, I install computers in the Microsoft offices through one company while testing Xbox 360 hardware/functionality through another. I never received one of these letters, it was answered for me. I would also like to note I have barely had work for the last couple months, and it is terrible. Microsoft is a corporation which uses its contractors as fodder in order that it doesn't get the media that is normally involved with laying off employees.
  • Wrong!! (Score:2, Insightful)

    by DaMattster (977781)
    Microsoft skills are not the key to economic recovery. The key to economic recovery is open source and open standards which encourage innovation and competition. With competition, comes improved products and reliability; not this poor security/reliability record that Windows has. The keys to economic recovery come with the innovations of open source that stem from individuals, universities, and companies like Red Hat, SuSE, Vyatta, Asterisk, and others alike. It is the practice of using M$ software rath
  • Sort of poetic justice..

  • So in this day and age when it takes less than 15 minutes to establish a LLC and set yourself up as a private contractor, why would anyone work for one
    of these employment agencies? I guess if the job pimp says you are going to take a 10% cut then you are going to have to do it if you want to work
    on his street corner. Admit it, if you work for a contracting company you are nothing but a simple code whore.

    • Re: (Score:2, Informative)

      by careysb (566113)
      Only a handful of contracting firms are considered "approved suppliers". If you are on your own your out of luck, at least as far as big companies like Microsoft are concerned.
    • Re: (Score:3, Informative)

      by batkiwi (137781)

      Most big companies will not deal with individual LLCs. They have a "panel" of agencies (say between 3 and 10) that you have to go through.

  • Not just Volt (Score:5, Informative)

    by Anonymous Coward on Sunday March 01, 2009 @05:16PM (#27033417)

    All "a-" (contract employes) were told to take a 10% pay cut. Those of us at Aquent weren't even asked to "vote".

    We're trying to get the word out on this site: http://www.msratecuts.org/

    There's no headcount for permanent hires now, and I don't think any Blue Badges are getting raises, but that's different than taking a 10% pay *cut*. However, at least on my team, they're still hiring contractors.

    On the Aces (Flight Sim) team, they fired the whole team and then asked about 3/4 to come back as contractors, forgoing their severance.

    IMHO: This is an excellent catalyst for unionizing.

  • by Maxo-Texas (864189) on Sunday March 01, 2009 @06:09PM (#27033945)

    American workers take a 25% haircut and become competitive again.

    During the great depression there were several major waves of pay cuts.

    This service economy fantasy is not sustainable.

    What's missing is the 75% pay cut for the executive class back to 1987 levels when they "only" made 50 times the average worker (instead of over 400 times today) AND raising taxes on dividends and capital gains from 15% back to normal income levels ( these extremely low tax rates on div and capital gains are why warren buffet averages 17% income tax rate while his secretary averages about 30%)

  • by christophercrooker (1489897) on Sunday March 01, 2009 @10:26PM (#27035923) Homepage

    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.

    • by JoeFromPhilly (792856) on Sunday March 01, 2009 @11:28PM (#27036439)

      Don't these circular relationships represent the defintion of a "downward spiral"?

      Absolutely. This is why economists get spooked when they hear the word deflation. Even now they can't bear to say it, and resort to euphemisms.

      Are we sure we understand the impact of these actions?

      We understand the economy in almost exactly the same sense as we understand the weather.

      In the meantime I will buckle under and keep working my ass off.

      That's probably the only thing anyone can do. Good luck, this year is going to be a brutal adjustment for a lot of people.

  • by ChrisA90278 (905188) on Monday March 02, 2009 @11:55AM (#27041413)

    These are CONTRACTORS not employees. The whole reason a company uses contract labor is so they can adjust the number of bodies to the workload without having to later layoff their own employees. In other works these a TEMPORARY jobs. Everyone understood they were temporary and would not last. I don't even count not renewing a contract with a layoff

    I was a contractor once too. And sure enough we were the first to go. With all of about 20 minutes notice at that. Cutting your pay is just a very nice way to say "Find another job, soon." The more normal way to say that to a contractors is "Find another job."

    Read the story "Volt" is a "temp agency". Our company uses Volt too. For thing like when a normal emplyee is on extended sick leave, they might hire someone on a 6 month contract.

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