Why Startups Are Making the Expensive Switch to Traditional Employment
time.com
time.com
Seriously? If someone is working Friday nights or Saturday nights, he SHOULD have higher pay. What it is with CEOs that they feel they are entitled to their worker's entire existence?
In this case it may just be poor wording. It doesn't say that they cared that they had to pay more, just that it was required to get people to work, which seems reasonable as you said.
Don't get me wrong, I think the U.S. 24/7 retail economy is bonkers, but I'm not sure it's reasonable to just bless 9-5 as the official time of economic activity. In the 1990s, I ran a climbing gym, and typically worked 3pm-11pm (or some variation of that) Monday through Friday. I kinda liked that schedule, as it allowed me to be more productive with "life" stuff because I could accomplish things before I went to work.
If a business is having trouble staffing during certain time periods then it's a pretty clear indicator that they might need to offer more to entice people to work those hours. It seems like a pretty clear example of the free market in action.
https://www.opm.gov/policy-data-oversight/pay-leave/pay-admi...
Though it sounds like on the Federal level, the employee must work a majority of their hours within a particular time period to qualify:
Night shift differential means the differential paid for work performed when the majority of a prevailing rate employee's regularly scheduled nonovertime hours fall between 3 p.m. and 8 a.m. It is computed as a percentage of the employee's rate of basic pay.
It works for some, but not for everyone. And not for their entire life.
That's not bribery; that's simple supply and demand.
Structurally identical: "The leaders at [insert startup here] hadn't been able to employ engineers for free, they could only bribe them with high rates of pay"
Employers will exploit this fact and take advantage of people desperate to keep their job.
In technical terms, there should exist an intersection between your marginal propensity to spend and your marginal utility of leisure (i.e. not working). But if you can't determine your fair 'value' when working shitty hours, then your 'calculations' can't be correct.
Just because the extra incentive the company supplies isn't money doesn't mean they aren't still operating in the world of supply and demand.
Given that one is going to lose a fight with the IRS or local labor department over classification -- and one will, eventually, if you're doing things like e.g. giving the employees checklists or training them on the "company standard" -- might as well bite the bullet early.
[ + ] Many people employed in startups are young and may, how to put this gently, not have experience giving them an appreciation that members of the class which Stanford sources most engineering grads from are not perfectly representative of all Americans in all ways which matter towards employer/employee relationships.
Uber does none of those things. They don't even tell the driver when to switch the app on and off. So I guess, your point is, that Uber doesn't have much risk that drivers be categorized as employees?
EDIT: I WAS KIDDING GUYS! Except my point about Uber. They really don't seem a bit like an employer to me. Particularly w/regard to control over drivers work. Bigger question, why does anyone think it would be an advantage to drivers to become employees and get lower pay?
The driver is clearly not an employee of the passenger. A driver given the instruction that they must comply with the passenger's preferences (as opposed to exercising their judgement as an independent business) may well become an employee of the entity enforcing that instruction.
It will probably be remarked upon in litigation over Uber that Uber will terminate their relationship with drivers who fall below a particular cutoff, specifically tells drivers this, and often specifically instructs them in ways to ensure this doesn't happen to them. These do not feel like insignificant facts to me.
I'd ask Grellas to handicap Uber's risk of being reclassified prior to asking me to do it, since he is an expert on this subject and I am not, but even from my lay view of the situation it looks like some of the Uber for Xs are at markedly more risk than others. Uber feels markedly less risky than firms which e.g. develop in-app checklists for heading off particular ops problems.
I can't imagine uber drivers would prefer a lower rate of pay, but hey, I guess that's what all these advocates of making them employees want us to believe.
Or maybe it raises the question, who is driving all this PR anyway? I can't see it as a grassroots thing from Uber drivers.
driverDollars = (fareDollars - 1)*0.8
If a driver is mostly taking people one or two blocks, the fares are going to be in the $3-5 range. That means the $1 "safe ride fee" (or whatever it's called) is already 20-30% of the fare, so Uber's total take on short rides is closer to 50%. It's one of the reasons drivers don't like short rides.
[1] edit: By net I mean after driving expenses, not after Uber's take.
Even if you pared Uber's take back to 10%, or 0%, it wouldn't cover the costs of making them employees. And it's the drivers that would take the hit.
Uber provides a tremendous lead-gen service for drivers. Everyone here who's tried to run a business knows that finding customers is the central challenge of a business. Uber completely handles that challenge for drivers, for a risk-free 20%. That's a pretty good deal.
But not calling them employees somehow magically creates money out of thin air to be labelled "profit" for Uber, without any detrimental effects to the rest of society?
Now, 20 days ago, Homejoy closed down, and I said what I am quoting below:
https://news.ycombinator.com/item?id=9903831
> the balance of power between the tech company and the "1099 contractors"
That hits the nail on the head. A 1099 contractor (a.k.a. freelancer) has to cut some 30%-40% off their wage to support things like self-insurance, etc (or add yea much). If you're "working" for a gig provider, you're not a 1099 employee by the inherent nature of the thing. Granted, you're not in a normal employer-employee relationship, but neither are you a skilled freelancer contracting your labor out on wages you yourself set and negotiated. While I fully support the idea of TaskRabbit, Lyft, Uber, Homejoy et al, certain realities have to be faced squarely: they are not being real about the nature of their business. They really are something like employers, with something like employees. Cheung is likely correct that a third legal category needs to be created (neither 1099 freelancer nor true employee), but in the absence of that, it seems profoundly more ethical to consider the workers employees.
Makes sense for companies to want to be in the position to say certain tasks must be done while controlling quality. Makes sense for people to want benefits and steady work/pay.
Never the less, here it's stated that companies are taking contractors or independents internally as employees in order to have more control over service and presentation. That's something to strive for. As a consumer of good and services, one tends to prefer the one providing better services.
Yet, Japan, which is very service oriented and super customer focused to the extreme, has seen its temp workforce take over. So, it does not seem, in Japan at least that you need permanent employees to get exceptional service. Something does not jibe.
If you work for a temp agency and they send you to a warehouse, you'll have managers/trainers a few steps away, you'll get paid by the hour, and you won't have to spend your own money.
On the other hand, if you're an "independent contractor" for a parcel delivery company you'll be working alone, you'll get paid by the parcel, and you'll be paying for your own vehicle and fuel and whatnot.
The different environments make a big difference in terms of things like whether an employee can make a loss/less than minimum wage, how much it's in their interests to cut corners, and how long it takes for someone to spot if they're struggling and give them help.
>Managers will have to make sure workers are taking breaks.
I almost never wanted to take a break while working for an hourly wage. I realize I am an exception, and I do not intend to raise issue with the requirement that breaks be offered, but I do find it odd that it is someone's job to ensure that I do not do something I want to do, and that my employer would prefer I do.
When working hourly, breaks tend to entail time spent in an unappealing space, without much time to do anything worthwhile, and not getting paid to do so.
Particularly with waiting tables, even a 30 minute break in a slow time would probably lose me 1-3 tables which could translate to anywhere from $3-$30. At an hourly rate, that's a decent chunk.
If anything I'd prefer to work a shift that is simply a half hour shorter, so I could actually go home and do things I'd like to do, rather than sit in a dingy breakroom while losing money.
Always good to figure out which practices have a sensible reason, and which are just "the way we do things".
Big business processes and techniques often take big business capital and big business experience. But as demonstrated by the success of many startups that avoid traditional processes in those early days, the processes are not strictly necessary.
Avoiding them may prove brilliantly competitive, or may prove to be some organizational debt that gets carried forward. Either way, the early days of a startup are very sensitive, and a little savings can make a world of difference.
That said, age is only a small part of the issue. I'm older and there's still a lot more that I don't know than there is that I do know. I don't expect that fact to change in a fundamental way: there will always be far more that I don't know.
The problem is that Silicon Valley people are arrogant and don't listen. They call the rest of the country "the paper belt" and think that regulators are just stupid, without taking time to understand why the regulations exist in the first place.
Also, there are a lot of older, man-child VCs who aren't 20-somethings and ought to know better.
Much of the youth/inexperience image that Silicon Valley wants to project is out of an intention to create plausible deniability when these companies do wrong. (The same with "Aspie chic"; Evan Spiegel is a lot of things, but I don't think that he has Asperger's, and I wish these people would stop using a real disease that they don't have to justify assholish behavior.) In comparison, if you're 55 and your company is at the center of a sexual harassment scandal, you can't use the "I didn't know any better" excuse or the "I was crushing code 20 hours per day, but I'll create a token 'Chief Cultural Officer' position and pretend to have solved this" justification.
Sidebar: I have Asperger's. It's not a disease, just a difference. And it's definitely not an excuse.
But yeah, there's a lot of the attitude of we'll just do everything different. That's just wrongheaded, stubborn and immature.