Ask HN: Typical Startup or Abuse? | Hacker News Reader

Ask HN: Typical Startup or Abuse?

134 pointsdatawalke166 comments

Over the past year I have been working for a local startup, in the United States, as the Jack-of-all-trades. We offer a product specialized to a fairly niche industry that is doing fairly well. In the past year we haven gone from 2 to 75 clients, gaining around 3 clients per week in the past two months. The product typically nets $5,000/yr per client. The product itself is web-based running off of an opensource CMS.

For the first 10 months I was the only person in the office doing work ~9 hours a day. From client setup, to design, to code and deployment I did it all. Twice a week I would be joined by the other 3 part-time guys who would do what they could in their 4 hours they had. Besides myself and the other team members the founder would do sales two to three days a week part time. Now a year in we have eight full time team members (5 Dev, 1 Sales, 1 CS). My role in the company has now taken on the Jack-Of-All-Trades plus the management of these other team members. Which I consider to be a great accomplishment for myself and I am proud of. However one factor in all of this has not changed in the past twelve months: compensation.

I was never a fussy person about money, especially when it came to startups. (I was in two other startups prior to this one.) I understand that you must bootstrap and try to be as frugal and agile as possible in the start. However a year in, and I am still making around $500/week. Which, in the beginning was great. However over the past year I have moved out, bought a car (out of need, the other died), gotten married, and have had a child. (With a second one on the way.) The other two major factors are: no benefits, and the founder seems to refuse to officially employ me (or anyone else in the company.). He still gives all of us a 1099. Yet, he treats us like employees. We have required working times, usually 8AM - 6PM, we only get a half hour lunch with no other breaks, and are on-call 24-7. Honestly, those items don't even bother me that much. However what does is that if I am one minute late from my 30 minute lunch, the founder will immediately call me asking where I am. If I happen to arrive at work a minute or two late I get a lecture. If I don't answer a call, on a weekend, I get a talk about availability. And if I am sick, I am required to work from home for the day. (I was in the hospital and still required to work.) That is what really gets me upset about this situation. I am fairly sure what he is doing is illegal with the 1099 issue. But it really upsets me that for all of the work and dedication that I have put in, that I can't get cut a break once or twice.

I am unsure how many of you are in a similar situation or even care. I honestly am not looking for any sympathy on this however I am seeking advice. Two weeks ago a new-hire and I went out for lunch and he asked me about the 1099 situation and asked what he should do. I told him to take some of the money out of his check to save for taxes. He said something to the degree of "But I only make $500/week!". I am not exactly sure why that made me lose my cool. Ever since then I have felt that the founder has not only been using me, but also the rest of the team. And I am letting this issue get to me. I spend each day now hating what I am doing because I have this feeling. I know the easiest answer may be: Well why not just talk to the founder? And I have.

The response is always the same: "We can't do that right now."(Benefits/Employ) "Remember I haven't even paid myself yet for any of this!"(Compensation) "It's cheaper for you if we do it this way!" (1099) And he won't budge.

I have been doing web work since I was nine. This is my passion in life. I spend all the time I can perfecting my craft and trying the best I can to stay current. I've never cared about money in the past, but the time has come where I have to. I hate myself for letting this job get to me to the point where it makes me burnt out on my passion.

This leaves me in the position of asking myself what to do now. My gut, and my wife, is telling me to begin looking for other jobs. Any advice? (And thank you for taking the time to read this over, I deeply appreciate it.)

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I realize that feelings of loyalty to an employer can skew one's perspective on things. (Oh boy, do I.) You need to hear someone say this, so I'll be a bit blunt:

1) You are being drastically underpaid relative to your market worth.

2) The fact of you being underpaid will cause material hardship for your wife and children.

3) Your boss is exploiting you. Illegally, to boot.

4) Your boss will not stop exploiting you.

5) You are being used as a tool to justify the exploitation of other people.

Don't "begin looking for other jobs." Mentally commit yourself to quitting, and to negotiating (you CAN negotiate, it isn't evil) a salary commensurate with your worth at your next position. You are a working professional. It is standard to receive fairly generous benefits, including but not limited to healthcare. Should you not receive benefits, you get paid an absurd amount of money to purchase them yourself. $2,000 a month does not even approach the ballpark of what employees like that cost.

I have to agree, dude you are making 26k a year. Starting salary for a fresh junior is 40k and that is just someone who know HTML, CSS and Photoshop let alone if they actually know a server side language.

He is lying about the 1099 being cheaper, that is only true if you are an S-Corporation, right now you are responsible for a little over 15% for social security, something that you are not if you are W2 or a corp. $500 is chump change to put up with Type-A personality bullshit like be here on the spot and no sick days. That is fast food management, you need to bail as fast as you can you have a wife and kids that rely on you to seek as much as you can.

As for the "he has not taken any pay" crap, he has equity, you do not your only reward is your pay check in that situation.

"As for the "he has not taken any pay" crap, he has equity, you do not your only reward is your pay check in that situation."

Very correct. On several occasions I have been promised equity. At first as a compensation for my pay, and then as vested. However none of this ever came into existence. Every time I brought it up again he would keep putting it off. But then in any discussions for a raise or anything to that degree he would use it against me saying something to the degree of: "Well, you know you are going to get equity in this!" I called him on it once. Saying that I wouldn't want equity if my pay was increased. The conversation ended right there.

Sorry, but I doubt that the guy is actually going to give you any equity. You could say you are leaving unless he gives you an offer on paper (which should include some notion of the percent of the company you will get - if he just offers 100,000 shares you can bet he will set total shares to 100,000,000,000 to screw you out of owning a real chunk), but he'll probably call your bluff.

As another poster suggested, get out and go freelance. Maybe you can steal his clients - I hope he has been as lazy on the non-compete as he has on granting options.

Agreed.

Originally he brought this up and I was thinking like 10 to 20%. He then said something to the degree of a half percent per year.

I unfortunately did sign a non-compete. The founder has pretty tight connections within this industry. It would be hard to steal clients to begin with -- I make sure all of the work is perfect and the clients are happy. I also would feel unethical doing so.

Check your state law, non-compete may not be legal.

They're enforceable in Pennsylvania, and poaching clients is one of the more direct and easy-to-prove ways to violate one.

datawalke can go nuclear and threaten to drop a dime on the IRS (and the state come to think of it). The boss may think he's being smart by using Simon Legree as his role model but it's set him up for some really severe real world retribution, very possibly including personal bankruptcy (see my earliest reply in this topic for details: http://news.ycombinator.com/item?id=1446428).

Whether to do so may be a personal choice. But if you do, get out first; don't do it while you are dependent on the place. Based on your description, finding other work that pays at least as well should not be terribly difficult even in this market (the one caveat being to explain why your pay was so low; there was a recent HN conversation on whether to provide previous pay data and how to appropriately decline to do so, that may be useful). And you don't want to be job hunting while embroiled in such a scenario.

Based on your description, I would expect NOTHING from your current employer. Actions speak louder than words, and this guy's actions have "asshole" written all over them.

He could also heavy his boss into releasing him from the non-compete. A lawyer would be necessary here, as you don't want to cross the line into blackmail ...

The others are right, you will never get enough equity from this guys to equal anything.

He'll give you 10k shares at 10 cents apiece and then want you to shut your mouth about it. Which is great, if the company is sold for $100,000,000 -- but it won't be, and he will continue to pay you less than 16 year old make at In n' Out burger and drive you into the ground as a penalty for holding his feet to the fire.

People that value other people, would have never had you in this position in the first place. He doesn't, walk away.

Based on that additional piece of information I have some advice for you.

Take your boss aside, and tell him that you need his undivided attention for an hour or so, later today. Wait patiently until whenever he agrees to meet you. Then tell him that you believe the current situation is completely untenable. Tell him that your intention is to quit, immediately, today, and that you still believe that is the best approach. However, rather than necessarily abandon him, you will remain open to instead receiving a portion of the equity. Decide BEFOREHAND what portion of the equity you want, and make sure it's something that would make you feel GOOD about working for peanuts for a few years. Tell him to think about it overnight, and see what he says in the morning.

Based on what I've heard so far about his personality, I'll predict that he'll probably tell you to get lost. Or he'll beg you to stay without the condition. But stand your ground. Then go find a better job.

Just as a tangent, because I didn't want to bother with my own Ask HN:

> Starting salary for a fresh junior is 40k and that is just someone who know HTML, CSS and Photoshop let alone if they actually know a server side language.

I know, like the back of my hand: HTML, CSS, Photoshop (and Illustrator/InDesign/Premiere/etc), Javascript, PHP, Ruby (not specialized to Rails, but with a year or two of experience in it), and C/C++. I've had more than a year's experience in: Java, Lua, IA32 and ARM assembler, Haskell and Clojure. On top of that, I have years of Windows and Linux sysadmining, DBA, and tech support/computer repair knowledge.

...but I'm only in my first year of University, and have literally zero measurable work experience with any of this stuff (no previous employers in any sort of technical field, no references, no portfolio..) In short, I have no proof that I can do any of the stuff I can do... what should I do?

I don't have an answer to your question. I am suspicious that you have zero measurable experience. Are you sure? You are familiar with multiple web stacks, but don't have a single website you can point people to? You were a sysadmin for years and don't have a reference? You have zero contributions open source projects (others or your own)?

I think you might be able to find something that hints at your experience.

> You are familiar with multiple web stacks, but don't have a single website you can point people to?

Only my own homepage, which isn't proof of anything at all, since it's about as visibly complex as an FTP directory (despite doing some neat things with Heroku, Sinatra, and a makeshift Dropbox API underneath.) It used to be a byzantine mess with its own forums and wiki and project hosting—and utterly no reason for anyone to use any of it, but for the fact that I wanted to have those things, and so I made them. Now it's just pages.

I've built web-apps as personal projects, but have long taken them all down or thrown them out due to loss of momentum (I had no users, ergo no one cared, ergo no reason to develop in any particular direction...) The few that I've held onto, I would never want to be publicly viewable, as they have absolutely horrible graphic design (by me, who is most definitely not a designer.)

> You were a sysadmin for years and don't have a reference?

I have sysadminning skills—but I was never a sysadmin (except for a non-profit community center, in a volunteer capacity, as an unofficial side-job to the normal duties of tutoring old folks in Internet skills, and which shut down soon after I left....) I read articles and books about it, I download and figure out how to use $20k/seat software that is utterly useless on the single computer I install it onto, I figure out solutions to problems posted online by people who seemingly have 100x the experience I do, I tinker with machines and networks that aren't my own... but no one's ever paid me for doing any of that. I see it as a hobby.

> You have zero contributions open source projects (others or your own)?

Yup, absolutely nothing. I probably have twenty or thirty things I could declare open-source, but none of which I'm proud of—in fact, the amount of technical debt in each is enough to make me ashamed that they have my name on them (though I doubt others would see it that way—I'm somewhere between perfectionism and extreme social anxiety when it comes to work done as anything other than a direct request.)

---

An aside:

Now, I'm not saying that, with a year or so of work, I couldn't build a really damn awesome portfolio, something I could be proud of and that would show off every one of my skills. But is that what I'm supposed to do? Is that better than just working my way up from an entry-level job, pretending I have no skills? I honestly have no idea; that's what I've been doing up until now.

I should mention that currently, I'm unemployed, and very quickly running out of money. Obviously, I don't have a year to put in right at the moment, even though I do have the skills right now :)

I ask my parents what to do, and they tell me to get a job for minimum wage in a grocery store. They're simply happy that I'll be able to make $50k/yr once I graduate (they've made that much, combined, for their entire lives.) In school, every class I'm allowed to register for, I pass without having to learn anything; and all the classes I'm interested in, I've learned by the time I qualify for them. Basically, I'm coasting, and I've gotten really good at it. I don't have any mentors or role-models to pull me forward, so I just drift.

---

Sorry, that became more therapeutic than technical near the end—but the answer is yes: right now, I'm quite sure that I have no proof of anything.

Hi. I am a freelance web designer, and I am looking for a web developer to partner with.

You will need to create websites and web apps for local clients, which will give you the experience and the references. At the same time you'll be able to make some money.

And the flexible hours you get as a freelancer means it wont interfere with you studies like a regular job might.

If you are interested, email me at alexwyser@gmail.com

You really should consider releasing your work. It's a great motivator to do more and release often.

I agree with mnemonik.

You wouldn't be able to gain experience in those listed skills without using them for something. There has to be some work of yours out there somewhere. And if not, start doing some freelance work or launching some of your own ideas/projects onto the web. It's a great way to get real experience out there and extra rewarding when you see users interacting with your work!

Look more closely at what you've done - for the sake of a resume, almost anything can be turned into 'experience' (I believe I spun 'computer lab monitor' pretty well once upon a time). In addition, take what you know and do projects with them. Something you can point a potential employer to (github repos, open-source project contributions, etc). What I want to see is initiative and creativity and, if possible, cooperative projects, because I know that someone coming out of uni isn't necessarily going to have team-coordination skills (communication, consideration, etc), but those can be developed.

Please understand that I intend this as honest and helpful: you are completely, wildly deluding yourself.

It is unlikely that someone with your background really knows even one or two of the tools you mentioned "like the back of your hand" by professional standards. It is completely implausible that even the most gifted and enthusiastic geek on the planet knows all of them to that standard at your stage in your career.

The world is, however, full of people (usually students with little or no professional experience) who think they have these skills. It just comes across to experienced professionals as arrogant, ill-informed, lacking in perspective... amateurish and risky, basically. Would you hire (or even interview) someone you thought was like that?

My advice to you is this: decide which skills you want to highlight at the start of your career, and if you really have no demonstrable experience with those skills, make something. Build a simple game in C++. Write a simple but well presented CRUD application to show your web skills. Write an interactive symbolic calculator in Haskell. Make sure the code is clean and you have some respectable documentation to go with it. You presumably have several years to go at uni, so you have plenty of time to develop your skills. Just keep the example programs you develop along the way.

Actual demos of real projects that you have personally completed are just about the best advert there is for your programming skills. Even if those projects are just small demos, they still beat beautiful but empty CVs any day for getting noticed and attracting the right kind of attention from prospective employers.

My advice to you is this: decide which skills you want to highlight at the start of your career

I think this part of Silhouette's advice is more critical than its brevity suggests.

I can only say this in hindsight but it's critical for you to only highlight a few of your skills (or even just one, in some cases) even if you have many. Saying you can do HTML, CSS, Photoshop, assembler, Ruby, and 101 other things is not going to floor the sort of people you need to impressive. I didn't know or understand this at 20. At nearly 30, I know enough people and have had enough experience to know that even if you're not a specialist, appearing to be one and then pulling out your jack-of-all-trades card is the most powerful way in to some great situations.

You're right, of course. I would never list any of these skills on my resume, or tell any interviewer that I could do them. I would never try to get a freelance contract that requires these skills. They're completely self-taught, completely untested, and I have zero confidence that I really "know" any of them. When I said I have no proof—I meant I have no proof for myself, either, as an empiricist.

Really, what it amounts to is that when I come home, I spend twelve hours (that is, 4PM-4AM) "studying": reading programming books, testing out bits of code, writing scripts and hanging out in places like /r/coding and LtU. It's basically my sole hobby, and I started when I was 11 (with a website run on a scrounged Pentium Pro off a Slackware LAMP stack.) I'v continued teaching myself various skills since then, never producing useful output, just reading and testing myself. I don't have confidence that my skills are anything more than a bunch of academic knowledge.

If I recall, these are the most code I've ever actually written:

* Stargazer, an interactive galaxy creation program in SDL/Ruby (you plot and name stars, create flight/jump/trade paths, and classify arbitrary three-dimensional regions with arbitrary metadata; it's for sci-fi writers.)

* Persona, a webapp where you create a user, that user creates several fictional characters (personas), and then, as a specific character, you answer questions out of a user-generated pool in order to flesh out your individual character. It's sort of like OKCupid in reverse—you specify the "factors" your graph of characters should display in advance (love, hate, admiration, apathy, etc.) and then the service helps you answer questions in a way that will conform to those pre-ordained relationships.

* Nameclasser, a Bayesian classifier trained on the details of individual words (sound, length, derivation, etc.) You feed it a dictionary; it spits back a subset of it usable as "interesting" character names.

* Folio, a mark-up language (and reference parser) similar to markdown, but intended for fiction (distinguishes pages, has footnotes, does neat things when it recognizes sections of screenplay-like dialogue, etc.)

* Christmas, a graph adventure (it's a text adventure, but with the interface being clickable words in bubbles—basically an ever-expanding tree of circle-menus.) It's two-player, networked: the client(s) are in C with Lua extensions, server in Clojure. It also features something I've never seen before: network-transparent undo. (Only works under certain world-model-specific conditions, of course.)

* SMS Importer, a little tool to sanitize a copy of your SMS database, copied from your iPhone's backup folder (SMS data has always been stored in 3d0d7e5fb2ce288813306e4d4636395e047a3d28.mddata, if you're curious), and present it as a folder of formatted-text chat logs. (It also keeps its own gateway database, just merging in previously-unseen texts, so you can delete an SMS record on your iPhone—it makes it a might bit faster—and still keep the record after re-importing.)

* An unnamed, unfinished project involving editing timelines of narratives and meta-narratives in time-travel stories.

* Nodepad, a hierarchical outliner (where every "node" was a folder+rtf file underneath, so you could make any node the working root), and Sponge, a visual to-do list (all the tags were importable 16x16 icons), both in C#.

* Wikirei, a wiki designed from the top-down to look as clean, presentable, and non-wiki-ish as possible when you don't have editing rights, and elegantly expose editing features when you do.

And each and every one of those is crap, in my opinion, and I would never release any of them. ...Having said that, and looking at that list, my problem might more be anxiety at releasing my work, than actually producing it. I've been working in a silo for so long, with no feedback as to whether my code has any quality (except what books say) that I have no idea what others will say when they see mine.

This time, I think perhaps you don't give yourself enough credit. There are a lot of interesting ideas in that collection, things that would grab my attention and make me curious to ask you more about how you did it. Even if you never polished those projects to a professional standard, it is impressive if you actually wrote that many useful/interesting things by your age.

Again, I would recommend picking one or two examples in the area you're most interested in pursuing first in your career, making some effort to polish them up to what you would consider a professional standard, and then using those as your "portfolio pieces". I've done my share of interviewing, and really, not much shouts "Hire me!" faster than someone who can show that sort of interest (really important when you're hiring for a position where no applicants have much experience yet) and who has made the effort to show what they can really do.

Also, for what it's worth, it's very common to be nervous about showing your code to others. I've been programming professionally for a long time, and I still hate it. I'm never 100% happy that there wasn't a better way to do things, or that something wasn't a little bit untidy. But programming is a world where the best is the enemy of the good: there is rarely one "right way" to do something, and there comes a point where you've written code of sufficient quality that does the job it needs to do. Trying to refine it further is usually just a form of pride/vanity at that point, and with experience you will learn to recognise this in yourself (and, in due course, in those you work with or manage) and to just say something is done and ship it. You can always see neater things you might have done in the code with the hindsight from writing something once already, and sometimes that will really pay dividends later, but adequate imperfection is the world we work in most of the time and it's the same for everyone.

It sounds like quite an accomplishment for your age - Silhouette is just trying to ground you in reality, but it's still praiseworthy.

Looks like you're pretty much into writing fiction? (or game scripts?) If that is your passion, then maybe you want to look into that?

Sign up for a free account at elance.com and spend a day taking their tests. It's the fastest way I can think of to demonstrate that you know something. Even if you don't take any work through the site, you'll have some evidence of your skillset that you'll be able to show potential employers.

Not to discredit you, but I get very suspicious when people merge C and C++ to C/C++. There really not the same language, you know. And I'm yet to physically meet someone who actually gets Haskell.

I'm not very experienced, but more often than not, the devil lies in the details. Reading K & R is one thing, but being able to track down why your code sometimes gets a SIGILL is an important, perpendicular skill. Perhaps you could try patching some open-source software? If you really know all that you claim to, you'd be invaluable in any project.

> And I'm yet to physically meet someone who actually gets Haskell.

I've met someone who gets Haskell. His name was Wadler, mind. :-)

Nice!

How have you met him? Are you his student?

You say:

> I know, like the back of my hand: Javascript, PHP, Ruby, and C/C++. I've had more than a year's experience in: Java, Lua, IA32 and ARM assembler, Haskell and Clojure.

And:

> I have no proof that I can do any of the stuff I can do.

I don't see how both these statements can be true. If you know some language "like the back of your hand", you'll have written significant amounts of code in it, at a bare minimum I'd say a few thousand lines.

You're claiming to have done significant work in 9 languages, and have no code to show for it? That's a bit odd, isn't it?

It's not cheaper if you're an S-Corporation either.

It depends on what state you incorporate as well as live in and what business deductions you can take (basically a lot of variables).

But, you are correct, that was loose advice with no detail around it, for which I am sorry. I should have just stuck to the your getting screwed by getting a 1099 over a W2 answer.

26K if he doesn't take any vacation time (looks like he can't take sick time...) minus almost 2K for his share of FICA withholding, adjusted for whatever he can claim as expenses on his Schedule C. Which is not likely to be much.

Thank you for the bluntness, at times -- especially now, I think it is needed. I have been in this position twice before where I have been debating what to do in terms of leaving/staying. However this time is different. I have never felt a depression like I have over the past two weeks.

Mentally commiting myself is something I believe I can take hold of. My main issue and worry will be finding a new employer. The area I am in currently, Northern Eastcoast, lacks tech companies. I would have to relocate to Philly, New York, or Boston to get to any hub. And currently money is too tight to do something of that nature.

With this job I got myself into this nasty living paycheck-to-paycheck situation. I will have to have something in place before I leave.

Start applying for contracting jobs that let you work remotely.

And start right this minute. Good luck!

Working on updating a few resume and portfolio items now. Thank you for the good luck!

Most companies will pay relocation expenses if they hire you, and will pay for transportation to/from an interview if they're interested enough to ask you to an in-person one, so lack of money to move shouldn't keep you from applying, if you know of a good opportunity.

datawalke, you know about elance right? No it isn't high salaries, but as your "rank" increases, your rate increases and there is a ton of work on there.

I'm not saying do it full time, just walk out of this currently nonsense situation and do elance for a few months while you look for another full time job.

You'll be amazed at how many opportunities there actually are in this world that don't suck once you start looking.

You'll be fine dude!

Second the Elance (or third, whatever). It's hard to compete with the third-worlders there, but man - you're starting from nothing. You should be able to double your income in your off time.

As soon as you're making $500 a week - which will really not be a problem on Elance for anybody competent with a good grasp of the English language - quit. Just walk out the door. No notice, just at the end of the day, go to your boss and say, "I'll be leaving now."

Then tell him your new hourly rate for consulting. Make it a good one. If you're as indispensable as you sound, you'll be working the same job with a reasonable rate within a few weeks.

> Then tell him your new hourly rate for consulting. Make it a good one.

Note: search around here for tips on choosing a good rate. And then factor in your history with them.

"you CAN negotiate, it isn't evil"

This is generally an option, but in this case it is not in the original poster's best interest to negotiate. The only proper course of action is to leave. His employer has demonstrated how he prefers to do business and that's not going to change. Negotiation can win you the battle, but there will be plenty more down the line. Might as well get hired by more scrupulous employers (and there are plenty and the job market is good).

I believe Patrick was suggesting he negotiate with potential future employers for a fair salary, not with his current employer.

Right. I see no point negotiating with people who cannot be trusted to uphold their end of the bargain.

Incidentally, I would never suggest that anyone negotiate with the goal of getting a "fair" salary. I think that is our inner serf talking. Find your inner hedge fund trader and send him instead. Sure, $60k might be a marked improvement in your standard of living, but if you think "Oh yeah, that is fair", you're probably not going to say "That offer is interesting. Can you do better?" and get $5k extra (plus compounding on your annual raises, plus a higher peg on every future position in your career) for two sentences of work.

Ah, thanks for clarifying!

> You are being drastically underpaid relative to your market worth.

Ha! Tell me about it. My current salary is $78k in Florida and I'm a jack-of-all-IT-trades. I answered a few Craigslist job ads and got offers for $100k+ in my own city. I'm soon starting a job that pays about $120k-150k (depending on my productivity/hours). That's a 70-90% pay-raise with almost no effort in searching. Also I get a lot more benefits, fewer responsibilities, and an actual bonus/raise/review schedule. Being loyal in this day and day will only get you exploited.

I mean no offense when I say this, but you're a great example of a "smart but clueless" employee dishonest startup founders prey on. At $500/week, you are making $26,000/year. Assuming you're a good developer (and now manager), you could probably pull in $120,000 working for Google or Facebook, which means you're losing $94,000/year (!) in opportunity cost (not even counting health benefits or other minor perks). You said nothing about equity, but assuming you will own 1% of the company after four years, and assuming the company exits for $50mil, your equity will be worth $500k, while you could have earned $376k working a stable job (again not counting health insurance, plus Facebook gives equity too). Considering that a potential exit opportunity is associated with large risk, the expected value of working for such a startup is miniscule, compared to opportunity cost.

You are not acting to your own advantage financially or emotionally. One option you have is to renegotiate your salary with the founder, and considering how hard it is to find great people, and how little he pays you, I have a strong feeling he'll budge. But if you have options (and it's your market now), do you really want to work for someone who has no ethical standards?

BTW, we're hiring: www.rethinkdb.com/jobs.

EDIT: just read your comment that you do not have any equity. Run, don't walk.

I thing renegotiation is out of the question. I feel even if I renegotiated and it ended up being the perfect compensation/benefits position the day-to-day work environment would become hostile -- and that is something I do not want to happen.

I honestly don't know what I was thinking. -- Well actually I do: Back in 2008, a year and a half into college, I won a local business plan competition and dropped out. (The competition gave office space and some startup capital.) The college I was in was a small community college and the classes weren't that great for the IT field. Going into college I thought everyone would have the same passion I did. Into the first semester I was helping teach my major related courses.

Unfortunately, not having any sense about business and being somewhat misguided by my other founders, the business flopped. I started a second business which did slightly better, and again won the business plan competition again. However our overhead was too high compared to the cashflow coming in. We started working with the company mentioned in this post and I was basically made an initial offer to work exclusively for them. (Mistake.)

Going back to my reasoning: I felt that if this company did go somewhere, that there would no longer be a need or a way to get roadblocked by not having a degree. I am a strong believer in work and passion than a piece of paper. I know I would have never hired any of my classmates from that college.

Although the justification is/was not sound at all. Getting out know is the only way for me to continue to seize my potential. I know continuing down this path will only lead to my own destruction.

You sound like a smart guy. Your failure thus far is an amazing and truly educational amount of experience that will benefit you short- and long-term. You really have a great deal more experience than many, and clearly you have drive and passion.

You're valuable and hardworking, so get the hell out of that shithole.

With your experience, you should be able to make some incredible contributions to any other startup that has a good product/service and actually cares about their employees.

$26,000 a year is ridiculously low... absurdly low. Hard-to-fathom low. If you feel like renegotiating would create hostility then that is far and away the biggest alarm that you need to get out of there.

As coffeemug said, "run, don't walk."

Going into college I thought everyone would have the same passion I did. Into the first semester I was helping teach my major related courses

Don't you hate when you come to that realization, it is even worse when you get out in the real world and find that these people make up a good portion of your technical peers. IT is one of the reasons so many IT projects fail. Crappy people make crappy products when it comes to software.

Don't fall into the education trap. I know that it chews on you and can give you an inferiority complex but unless that degree has MIT or Stanford it's crap. I fell into that trap and spent 40k to get no further than I already was. But I started thinking in my mind, I will get passed up for other people. This was after my first CTO position. Imagine that, I had made CTO, went on to sell the company, was wildly successful and yet the education trap was chewing on my mind. I realize now that the only person that ever cared was myself. We are in an industry where actions speak volumes and anyone you would want to surround yourself with as a peer, knows that a degree does not a good developer make.

1. This is abuse. You know it (otherwise you wouldn't have asked). What you didn't realize is how bad it is. It's VERY bad.

2. Find another job. This boss is hopeless, you can't fix it.

3. If you want to have fun, quit and tell him that you want to reclassify all the 1099 income as salary. He'll be liable for all kinds of social security stuff, he'll be in deep trouble with the other devs... That would be a major threat to him.

I don't particularly recommend an actual lawsuit, because the money you'd gain from it is so small based on your salary anyway. Also be aware that making such a threat would be extremely disruptive to him, as it would sink his business. So he may resort to more illegal schemes to fight back. Therefore it's probably not worth it - move on!

And please blog about it. Other people in your situation need to know about this. Include specific numbers, it helps!

The other comments have covered almost all of what I'd say with these exceptions:

This company will stay alive until someone drops a dime to the IRS, at which point they'll reclassify everyone as a W-2 employee and demand income tax and FICA withholding from the boss, with interest and penalties. Unless he's put a lot in the bank from his exploitation of you all, he's not going to be able pay this (pity that he's personally liable for this; whatever the corporate structure is, this pierces the corporate veil).

You want to get out before this happens or before the IRS figures it out in some other way.

When you give notice he will almost certainly threaten you; it would be by far the best to ignore it (don't escalate, who knows how crazy he might get, ADDED: and it's best to keep in reserve, e.g. see the next paragraph), but if you can't ignore it you could always say "Be grateful I'm not reporting you to the IRS...."

If he seriously threatens you WRT to your non-compete, point out his vulnerability WRT the IRS. Unless and until he converts his employees to W-2 status (and I suppose pays his back due withholding), he's exquisitely vulnerable there.

As some have noted, don't bother to sue. At best you'd receive a pittance, per the above you might end up trying trying to collect from a bankrupt company/the owner. What you really need is closure, getting away from this bad situation which is no doubt slowly poisoning your attitudes towards work, upper management, etc.

Damn. After reading your post and the comments I want to emphasize a few things:

- You are being screwed. This has been amply covered. - You are worth your weight in gold. If you really work 10 hours a day, hang out with your family then work into the late night... you are every CTO/VP of Engineering's wet dream. - You have rights. The law, in many places, is built to protect people like you from exploitative situations like this. Just looking at a glance, it seems like you could - if you so chose - bring this guy to court and walk away with a more equitable amount of compensation [INTERNET CAVEAT MACHINE ALERT: I am not a lawyer and this is not legal advice.] - You deserve better. With your work ethic and your attitude I hope the next group of people you work with give you your dues

Thank you for the kind words.

I think the key to my next situation is making sure the next group of people I work with give me my fair share.

I think this falls into what a lot of people experience is the doubt in not knowing what you are worth. In my area typical entry programming positions are at around 35k/yr. I feel my time and experience puts me well past any entry based position. I am always somewhat unsure of exactly where I stand.

I'm not an expert in your local area, so I won't try to advise you on specific rates. However, your point about time and experience is entirely reasonable: the job you have been doing, apparently quite successfully, sounds like a technical team lead. That is probably about the same as "Senior Software Engineer" in the pay stakes at most businesses, if they're big enough to distinguish the roles.

One other point that I haven't seen mentioned is that you don't have to try to fix your entire career in a single jump. There is nothing wrong with taking a respectable job at a respectable pay rate with a decent company as a first step, even if it's not immediately at the level of responsibility you were on before. You'll still get a lot more money and better working conditions. If it's a decent company they'll see your potential and grow your career rapidly anyway. Crucially, you'll also have another group of coworkers to ask for references down the line, if you do decide to move on again in a year or two rather than move up in wherever you go at this point. Don't assume you have to try to jump from an awkward position right up to the manager at Google/Facebook that someone else mentioned all in one go: you probably won't make it, and you'll be ruling out a lot of potentially useful opportunities.

You sure about that 35k? In any region I've ever lived in (midwest, southwest, bay area), entry is more like twice that.

A couple of thoughts from a bootstrapper:

1) If you were going to get equity you would have it already. It would have been a condition of your employment, in writing. Anything else is empty promise, as I fear you are beginning to discover.

2) Even if you HAD equity, that equity is WORTHLESS until the company is sold or goes public. Equity only has value at exit or if the company is going to pay some sort of dividend. From the sound of things, both are unlikely.

3) I know you feel like you are invested in this company, that you deserve better ... and you do. That loyalty that you feel to the company does not appear to be returned. As an employer, that is a massive failure. One of the true perks of being a bootstrapper is that I am empowered to give people the "breaks" that make my place fun to work at and family friendly.

I think that it is time for you to move on. Follow mmaunder's advice carefully, especially the part about not talking about ANYTHING you're planning with co-workers. At best your co-workers may unintentionally break your confidence, and at worst will do so in an attempt to curry favor.

Everyone else has already said how abusive this is, and hit the nail on the head with it, so I won't add to it, but I would like to say one thing:

You are worth far more as an employee than the meager salary and horrible relationship this guy has given you. Until you realize this, you will continue to be abused by future employers. You'll only be treated as well or as poorly as you let people treat you.

Hell, I am a fulltime employee with great benefits and a great salary, and I feel loyal to my company and team, but if my boss told me I needed to work from the hospital, I would tell him I was resigning immediately.

You need to stand up for yourself.

nods Thank you.

This experience on HN has been extra eye opening for me.

There are plenty of examples of entrepreneurs cajoling employees into working for little or no pay, sometimes with a false promise of stock options which are a tiny fraction of outstanding stock. But this is one of the worst I've heard.

I'm sure the other comments from the smart folks who hang out on HN will echo the above. So I'm going to suggest a strategy for you that is as exploitative as your boss is being:

1. Don't tell him you're leaving.

2. Don't tell anyone you work with you're leaving. I know you feel lonely, need moral support, safety in numbers and all that. But DON"T. You need to take care of your family so it's time to put on your game face.

3. Start networking with other developers in your city or the city you want to end up working in. Also, meet with recruiters, employers, even investors in the kinds of businesses where you want to work. But the most important group for you to network with is your peers i.e. other web developers. They are your best route to your next job.

4. DO NOT tell anyone about your sad story. It may make you feel better, but people tend to shy away from any sign of weakness. It will not help you and it will hurt your chances of getting another job. Come up with a generic story and never go off message.

5. Don't EVER disclose what your current (soon to be former) salary is. It will cause your next employer to "level you" and also under-pay you. Again, come up with a generic (but true) story and never go off message.

6. Keep interviewing, go to second or third interviews and actually LAND A JOB before you even mention a hint of what you're doing. No matter how close you are to signing with your next employer, don't get over confident or smug and disclose what you're doing until the deal is done.

7. Once you actually have another job, give your boss notice both in writing and from a personal email account that you will continue to have access to once you leave your company. Be brief and to the point. Don't get emotional. Use as few words as possible.

Now, about that generic story about your current/former position. It needs to project a positive "employable" image that looks strong and makes people want to hire you. Something like "I've had a huge amount of fun in my current job, but I feel I've outgrown the company. I enjoy working with my colleagues and the work is challenging and fun but I'm ready for my next big challenge." Practice the message on a few people you're talking to and let it evolve until it rolls naturally off the tongue and is giving you the body language you want to see from the people you're talking to.

Employers or recruiters will ask you directly about your current salary. Simply say "Unfortunately I can't disclose that information." They're sales guys and they will push but politely stonewall. It will only hurt you badly by disclosing it. You either won't get the job because they'll smell the stench of death, or you'll get an awful deal.

The one hole in this plan is the reference you may need at your next position. They may want to call up your current employer and ask for one. You could just be honest at this point and say that he doesn't know you're leaving yet so you don't want them to contact him until you've given notice. This actually makes you look stronger because you have a current job. You're not unemployed and looking.

As a general bit of guidance in negotiating:

"Never pass up an opportunity to say nothing." ~Robert Heinlein

"Never let anyone outside the family know what you're thinking." ~The Godfather

It's time for you to take care of the most important people in your life: Your family. So put on your war face and go for it! Good luck!!

http://www.youtube.com/watch?v=O6vHOR8lzTg

Thank you very much for your reply.

I agree with you on all aspects. It would be too risky for me to do anything but act normal until I settle my future plans out. One mistake I would have made would have been on the disclosure of my salary -- Thank you.

And admittedly, working at this company has been very fun and a great experience for me. However the nature of how the founder is and the current compensation drove me to where I am right now.

Thank you again for your advice.

After you say you are not allowed to disclose your current salary, they will ask you your intended salary. You should research your market's average salary in advance, and if possible, ask other developers in the company to give you an approximate figure. Aim a bit higher so you have a margin to negotiate. Don't go too high, or they'll think you lost contact with reality.

Please don't do that. Get them to throw out a salary first and flinch at their first offer. Then ask for more. Don't you dare discuss salary with developers in the company that is interviewing you.

You're going to need to learn to negotiate. This is the only book you'll ever need on negotiating. Even if you don't use a single one of these tactics (and I guarantee you will) you'll at least get an education of how much of an art negotiating is.

http://www.amazon.com/Secrets-Power-Negotiating-Roger-Dawson...

Whether you're hiring, selling a company, getting hired or raising money - this is required reading for doing business.

I actually have listened to this on audio tape. It is an awesome book and I'd recommend it to anyone.

It's true as a general principle of negotiation that the person who states a number first is at a disadvantage. However, someone has to budge sooner or later, and as long as you're being realistic there isn't really much to lose by giving the target. If it's out of range of what they're willing to pay, you might as well all know that up front and not waste each other's time.

Sure, if it may not get the optimal deal that might have been available. However, the original poster here is (a) in a relatively weak bargaining position because he's under pressure to move, and (b) so badly paid at the moment that any reasonable offer is still going to be a huge improvement in both money and working conditions.

For what it's worth, I agree with the earlier comment about not disclosing current salary. It's fine for them to ask what you're looking for, and it's fine to have negotiation, but there is no legitimate reason a prospective employer would ever need to know what you've been working on already. I have never accepted a job from a company that asked me for that information during an interview and persisted when I politely declined to give it, and if I were still working as an employee today I would consider it a huge red flag if interviewers (particularly management/HR types) stuck to their guns on that one. Also, in this case, disclosing the absurdly low compensation at present would make the poster look very weak and undermine any otherwise reasonable and honest story about outgrowing the company and looking for somewhere their improving skills will be better utilised.

This is the best advice of all that I've read in this thread. I wanted to add that strategically, you definitely want to have that job in hand before you quit.

Firstly, if you're interviewing at other places when you already have a job, they are usually willing to skip references and hire you based on tech knowledge and interviews alone. Grabbing tech talent these days is really tough, and most recruiters know they have to be discreet with people transitioning from a current job.

Secondly, the job you're at is likely to give you a crappy reference after you give notice. You want to be well on your way to making that next employer your next reference as soon as possible. The alternative, i.e. being unemployed with them as your most recent references, makes you harder to hire.

In addition include the following in your plans,

1. Become slow. Start doing 50% of work you do now and quietly spend the rest of the time preparing for your interviews, getting some portfolio web projects live with POLISH, like getting those corners rounded and stuff. Its really important. Also make sure no one knows you are doing this.

2. When you quit, write a blog, just paste the same thing you wrote here. I am sure many out here will publicize it and help your message reach far. People like these need to be taught a lesson and best way you can do it is by telling everything you told here to his clients. I wonder if they would like to continue doing business with such a person.

Now to make you feel good. In India, 21 is actually early to start making money. I started at 21 at Google. 23-25 is the average age when people start taking jobs and making money. I am surprised that you are married. With your age and experience you should simply focus on building your skills, your resume. Note its better to have one or two polished and public projects than having dozens of half baked things lying around. If you need help polishing things, post it here (seperate thread) and we will help you out.

Lots of good advice here. One thing I would emphasize: think about how you ended up in this (rotten) situation and what you can change about yourself to make sure it doesn't happen again.

You seem to have an extreme case of nice guy syndrome. You don't want to get into a conflict with your boss and you are highly willing to sacrifice yourself to meet his expectations. My guess is you would feel almost physically ill at the idea of "letting someone down" who was "counting on you".

You need to get over that, at least somewhat. If you don't set boundaries, if you don't have a notion of where your wants and needs are more important than what others want and need from you, you'll always be overworked, underpaid, and underappreciated. Nobody respects a pushover, and there are a lot of guys who will use them up mercilessly.

Did I read that you're only 21? If so, hey, you've got lots of time to get this sorted out. But you might as well start now. :)

Closing thoughts: Get out as soon as possible--there's a lot of ways you could go about this. Don't try to "get even", just cut your losses. Don't do anything unethical on the way out. Do not trust your boss if he starts making promises of change or reform. As soon as possible, start saving money and get a cushion built up. You'd be in a much better position now if you weren't living paycheck to paycheck. Good luck.

Just to give you an idea of where you stand pay-scale wise, I am a student employed part-time. I make about the same as you during breaks when I have the time to put in full-time hours.

You are making student money for professional hours.

Perhaps an even sadder comparison, as an intern at a web development company putting in similar hours, I'm making more than double that. You are clearly more experienced and skilled than I am; you deserve much much more.

heh, now you make me wonder if I too am getting shafted

To further goad the OP to immediately leave his current job: between junior and senior year of college, I made a bit more than the OP's yearly pay in a 12wk internship.

Please, for your wife and kid(s), get out of this horrible situation.

My first tech job was 38K a year, 17 years ago.

datawalke,

I haven't gotten a chance to read some of the other replies yet, but here is the brass tax: Your time at this company is done.

You know it is too; the language of your post says so.

For more clarification: 1. Your "boss" (I put that in quotes because no one needs to be your boss and he sounds like a tool) will never give you more money and will not care if you step out on the company.

2. Your "boss" WILL likely threaten you when you go to say you are leaving; ignore it. Tell him that is "unfortunate" and then leave. Give a proper notice, like 2-4 weeks to avoid any nasty claims. Please note that he will make those last 2-4 weeks as unpleasant as possible for you.

3. Move on. You have developed an amazing skill set, both from the tech side as well as the business side. Seeing and knowing a startup can succeed from the ground up like this.

You don't have so much time on this planet that you need to waste it. This guy is never going to "get better" or change, just step forward and leave this nonsense behind.

Forget the money, forget the bad feelings. Just push forward.

At the very least, if you are paid with 1099, be sure to document a lot of your expenses, such as all mileage used to travel, meals you paid for with another person where you discussed business, etc. Find a decent but cheap accountant who has experience with small businesses and they will at least help you greatly reduce your tax burden.

Oh yes, you are being exploited, plan to get out and make a huge amount more once you find a better position.

To put your salary in perspective, it would be reasonable (not great) in most of Brazil, but terrible in São Paulo or Rio de Janeiro.

So you definitely got a bad deal.

And you would have 1h lunch breaks, 1 month of vacation and a 13th salary every year.

Since you are an independent contractor and not an employee, did you sign a contract stating that all your work was a "Work For Hire"? If not, then you likely own the copyright to all the work you've created -- which means that while your boss may have a legitimate license to use the work you've created to date, he doesn't have the right to create derivative works (read: modify the software) or sell copies of the work.

You may find these articles interesting: http://www.nolo.com/legal-encyclopedia/article-29953.html http://www.bitlaw.com/copyright/ownership.html

If you were an employee on a W2 then this wouldn't be an issue -- your work would be a "Work For Hire" by default.

Your boss has created a legally perilous situation for himself. If you're a contractor, then he likely doesn't own the software he thinks he does. If you're an employee, then he owes a lot of taxes.

So if you're ready to burn a bridge, here's an idea. Find an attorney who will take your matter on contingency -- many will do a no-fee consult to see if there's a case. What you want to do is license your code to your former boss (the code he thinks he owns already) for a reasonable but substantial one-time sum. Low to mid five figures doesn't seem unreasonable to me.

And as everyone else has said, find a new job. If you're looking for contract work and you know CodeIgniter, email me (in my profile).

You're fucked but this type of situation is not uncommon.

This is how most smallish PR agencies, "digital agencies" and other sorta technical tangential "media" related companies in NYC operate.

You should just get any other sane job as quickly as possible and regroup. Working at Trader Joe's would pay as much and be less of a headache. If you can do any sort of web programming at any capacity you can make 70-120 grand in NYC. I don't know much about PA, but I know there are at least some decent jobs in Pittsburgh.

You're talented and hardworking. Stop taking this crap and ask him to meet your reasonable demands or leave.

I'm sure someone on HN here would be more than glad to hire you for another startup.

Thank you for the kind words.

If anyone on HN is hiring or looking to keep some extra talent in mind I would love to talk to you. I am very good at a select few things: UI Design, PHP (Specifically CakePHP), XHTML/CSS, and Problem Solving. I am also okay and very comfortable with Subversion and MySQL.I have a passion for the web and automation. You can contact me via HN or at: nowjobhunting@gmail.com

May I suggest creating a throwaway Gmail account for this purpose and removing your real email address in order to prevent your employer from finding this via a trivial Google search?

Good catch, thank you. The email address was unknown in this realm, but still could easily be connected to me with a little research. Took your advice and created one. Thank you.

Where specifically are you located? Northern East Coast is a little vague.

Pennsylvania.

How far from Philly?

Email me at ojbyrne - at gmail - dot - com.

Personally, I would not even want to work for this company anymore, even with better terms. Not sure if there would be a point in trying to get some compensation for the last years, though (ie using the "you did some illegal stuff and I know about it" angle)? I probably wouldn't bother and just move on, but that might be where I am too soft.

Edit: reading some of the other comments, with respect to being too soft. Perhaps it would be worth consulting a lawyer, and let them do the dirty work. Being too soft and letting other people take advantage for you could be a good reason for hiring a hard-nosed lawyer.

The danger might be to be taken advantage of by the lawyer, too. But my mother actually once had a lawyer get her a lot of money from her employer, and he said "it is not only important because of the money, but because of you". I was really impressed by that - certainly dragging this nagging feeling around that you are a loser also takes it's toll, so fighting it out might be worth it.

ABUSE. Here's how it works in a /real/ startup (I know, because I just went through this):

At hire, I ask founder "what do you think your exit looks like?" He puts it in terms of equity meaning for employees, "I am aiming for at least enough for each employee to purchase a nice home in this area."

A month after hire, at the first scheduled board meeting, I am granted options worth 0.5% of equity in the company, vesting over 4 years (I'm around the 12th employee). I am paid a salary commensurate with the rest of the industry in the area, as well as given full health coverage.

After about 2 years, the company is sold, making my 0.5% worth almost exactly what he said it would be worth, enough to purchase a nice home with cash outright.

Your founder is exploiting you. Don't dawdle dealing with this until you are no longer essential. You should lay it out for him, exactly as-is: you get your equity grant and a pay raise immediately, or you are walking.

Keep in mind, your founder might be trying to exploit you another way, too: he may not be planning an exit at all, or for a very long time. Meaning, equity is worthless (as long as he retains ownership). If he's making a lifestyle business out of this, equity is a big 0. Don't let him grant you equity but keep your wages at stupid levels.

start-ups are only start-ups to people who hold equity. to you it's just a company.

That seems rough. I'm actually going through a similar (albeit not as extreme) situation, which is why I'm at home on a Saturday night trying to generate leads for my freelance business.

Two major points from me:

First, you shouldn't get angry. You're there of your own volition and have to make the best of your situation. I know it's rough to hear, but getting angry will just waste your time and make it harder to be proactive about improving your situation. I need to remind myself of this constantly.

Second, I cannot attest to the legality of what's happening within your company. However, it would seem that if the founder is such a tyrant then many people would defect (clients as well as employees).

It seems like you could start a competitor business which serves the companies clients better than they are being served now. Who knows, any illegal behavior might nullify a non-compete clause (I am not a lawyer so please verify).

At any rate, best of luck. I do believe that businesses who don't value their employees pay for it in the long run so hopefully these things work out.

Short term, try reaching out to some people for freelance work. It's probably the best and quickest way to raise your income.

Thank you for your advice. Along with doing this business I do run a fairly good freelance business to make up for the lack of pay. The freelance work is what really makes me happy. The clients are always great and seem to love the attention I give them and the work I generate for them. However it does make it a bit hard mentally and physically for me and my family. Getting home at six, seeing my family for three or four hours and then working until 3AM each night gets daunting.

Can't you witch to working full-time in your freelancing? I don't know if you can get more clients straight away, maybe (if your relation is good enough with them) you can ask your current clients for work recommendations, bootstrapping even more your full-time freelancing.

I don't know the legalities and other related things aside, but I would make a rebellion, although you look in the worst position (you are being paid the same as a fresh recruit, come on!)... Walking straight to the boss and telling him either to raise pays or everybody leaves could be quite effective. And of course, 8 people talking shit about a startup can build quite a lot of momentum to keep him from getting any more job candidates/clients.

I do believe life is a good deal of weighing risks and taking them at a period of time. Jumping right off to freelancing would be too uncertain at the moment. Bills come to around $1,500/mo. Freelancing at the moment generates around $900-$1200/mo. But I currently only have the bandwidth to handle 1 or 2 projects per month.

On the rebellion side I would not feel ethical doing so. I don't want this guy's business to crash and burn. It does honestly provide a solution to a need in the industry and the product is of high quality. As much as I sometimes wish I was, I'm not that much of a dick to cause trouble. (Plus there may be some movement there of a lawsuit or something that would make me overly nervous.) I do have a feeling however that me leaving this company will have a snowball effect on the others there.

If the product is as good as you say it is, there should be plenty of money to pay well. And paying people well should increase the quality further: if you don't have to worry about basic needs you've got more bandwidth for being technically excellent.

Don't feel bad about 'rebellion', loyalty should be both ways and respect must be earned.

Stand up for yourself!

<i>If the product is as good as you say it is, there should be plenty of money to pay well.</i>

It sounds to me like this business is currently failing, but your boss is "faking it" by exploiting you; he might just as well be paying you normally but keeping the doors open by draining his grandmother's bank account.

It might not be a problem with the product -- after all, the client list is growing swiftly.

Simply put, he needs to either find the money to pay for what he's demanding from you, or he needs to close up shop. He might need a loan or investment to cover the gap until you are cashflow positive, but in this case he is stealing from you instead.

It's not even an "investment" on your part, because he seems to have utterly no intent to pay you back. That's just stealing.

For comparison, in an honest situation, he would be either: * paying you a normal salary as an employee * paying you a higher rate as a 1099 contractor (to account for your reduced security and benefits) * or paying you less but accepting the difference as your personal investment in the company -- so like any investment, if the risk pays off, you would be paid back MORE than your investment in the future. This would be formalized by giving you shares, etc. (and you should be able to calculate how/when you would be repaid).

I agree with bensummers. It is not about being a dick, it is about being treated fairly. You have been severely underpaid for a long time, and he acts like you can't have a life of your own but just be a robot-like jack-of-all-trades.

If my boss didn't pay for my health bill and asked me to work while at the hospital I would definitely not let it go like that, you are a human being, moreover, you are helping him to get money. And you are almost getting no money back.

As about lawsuits, it greatly depends on how you focus it. You are being exploited, you know it (and he knows it). You could probably sue him right now. And telling your colleagues about how work was like there is not unethical, nor illegal, it is helpful for them.

Couldn't you just balance on paying for more bandwidth (don't know the prices where you live) with just more freelancing? When you say "bills" you mean just that, or include expenses like food and the like?

I do agree that my colleagues do need a little guidance in the situation as well. They are almost all new-hires right out of college and were never exposed to anything else.

With bills it comes down the items I listed before (housing, car, student loans, credit cards, utilities) Food/misc wasn't included.

The issue with this area is it's fairly stuck in the old' days. People expect to pay $200-$500 for a website, regardless of what it does. It could be one page, or it could have all the functionality they would ever dream of but only expect to pay a one-time fee.

Just a thought, but have you considered that in your freelancing you might be aiming at the wrong market?

You say that people expect to pay $200-500 for a web site, and I'm sure a lot of places do, but that's the same everywhere. Some places want a cheap site that a college student could do or that they can outsource to someone they'll never meet in a low-paying country. Naturally, the quality of what they receive will usually reflect the price.

On the other hand, you seem like a diligent person and you seem to have some real skills in this area. You might want to consider aiming at the higher end of the spectrum, businesses who see a web site as a serious investment, and will pay accordingly for someone who is going to do the professional job that a typical kid won't. Look for the projects within reach of one person (give or take outsourcing any areas where your expertise is lacking) over a few months, and with the five- or six-figure price tags.

You don't need a lot more hours or a large team to take on these medium-weight jobs, but you do need a professional approach as well as the technical chops, and awareness that web development involves things like usability, accessibility, branding, etc. as well as just hacking on HTML. It sounds like that's exactly the sort of wider awareness and business-like approach that you have, but you'll never make the most of it picking up jobs for peanuts.

Sounds like my gf's work, where people expect to get a Facebook like where users post the content and they don't need to do anything, for a bargain price. It's a sad state of affairs, and teaching clients is a no-no, because a) They don't get it b) They may not hire you

But how much freelancing could you handle if you didn't have the exploitative full-time job? (How does your effective rate-per-hour vary at the main job vs. freelancing gigs? And, might you be undercharging for your freelancing as much as you're undercharging for day job?)

The ethical approach is to state clearly what you need to continue and if they can't meet that, you move on with proper notice. However, you are being underpaid and both the treatment-as-contractor and constant-low-pay-in-the-face-of-overtime are of dubious legality.

If by your acquiescence to unfair/illegal conditions you are then effectively encouraging their perpetuation, and their extension to other junior employees, and further falling behind in providing for your family, than 'not causing trouble' is the unethical path.

If the business would crash and burn without you, you are a key employee who deserves better pay and equity. But from the sloppy way things seem to have been handled so far, you might not even be able to trust a stock grant from your employer. (Even if he is in some ways charismatic or effective, you may have run across a bad actor who will press every advantage against a person who won't be personally/legally assertive in response.)

Why not convert your "1099 boss" into a real freelancer client? This involves a few simple steps:

1. Ask him to be "upgraded" to a real employee (he'll say no, as we suspect)

2. Tell him you understand his decision, and since he wants you to be freelance, you will work for him as a true freelancer, e.g. for a certain number of hours, at a certain hourly wage, at your own home, at the hours you choose.

3. He may "fire" you. However, if you are as indispensable as it sounds like you are, he will come crawling back to you. In any case, he won't fire you until he sucks know-how out of your brain, which he would do over the course of a month of freelance work. So you have some time to do the transition.

P.S. Leading a rebellion is only needed when you have no leverage. In fact, you have tons of leverage, you just don't understand or are unwilling to use it.

This could be a possibility. On #1 I know he will say no to. Actually, I believe all your steps would come out just as you laid them out there.

3.1) if he fires you and comes crawling back later, charge him double what you offered him at first ;-)

you should fuck your boss over as hard as possible. seriously, people like him need to be taught an excruciating lesson.

I am a freelance web designer. I am outside the US and only communicate with my clients via email and I make about $1500/month freelancing working only 4-5 hours a day. You should be making more by freelancing.

I sent you an email about this. I work as an outsourcing partner to US-based web design firms. These firms pay me a fraction of what they charge their clients, so I am looking to work with clients directly.

If you are interested we could partner up. I can provide web design and development services and have a very strong portfolio (alexwyser.com) to help us out.

This will allow you to take on more clients, provide a wider range of services (I do front-end and back-end stuff as well) and make more money. And probably help you freelance full-time.

Let me know if you are interested. And good luck.

OKAY, stop right there:

> I don't want this guy's business to crash and burn.

That's fine, you don't have to want it to crash and burn. HE clearly wants it to crash and burn.

While it's your entirely your responsibility for having chosen to stay in such a terrible situation, he's the one who created it in the first place.

He's the one who's betting his business on mistreating people. He's the one who's betting his business on mistreating, most importantly, a single person who holds his business together.

He could have paid you more. He could have fulfilled his promises. He could have hired other people to make you more dispensible, to hedge his bets, to protect his future.

But he didn't. Because he's not a businessman, he's a user. Users don't think "gee maybe I should use THIS guy a little less, to protect myself," they think "WEEEHEE I CAN SQUEEZE A LITTLE MORE OUT OF THIS DUDE FOR NOTHING!"

That's simply unwise.

It's not your place to worry about whether he goes out of business. It's his plan. It's his mistake.

And, after you leave and you've secured your future income, call the IRS on his butt. He is breaking the law and should be punished and switch his business model to something legal.

Don't do it out of vengeance, do it out of concern for future schmucks.

Seems to me like you should quit, and devote all of your time to growing your freelance business. It might be a bit tight financially for a while, but things should get better if you devote enough time.

The really unfortunate things about your situation are:

1. You're probably legally misclassified as a contractor rather than a full-time employee. You should read IRS Rule 87-41 to understand why that is, but the really telling part is that you're carefully managed as to work down to the minute. Dead giveaway - you're an employee.

2. Since you're clearly an employee, you're subject to the protections of FMLA. My favorite nickname for FMLA is the "F*ing Leave Me Alone" Act. If you're hospitalized and your employer knows it, it's really unnecessary to invoke FMLA to receive its protections. Your employer violated it by requiring you to work while incapacitated.

3. Because you're misclassified, you're probably paying self-employment tax, so you're getting screwed coming and going.

4. Your employer is too lazy to figure out how to get benefits for small firms. Going to a trade association like the AeA would easily get you access to insurance at a good rate. I assume he's covered through his spouse, and, as such, doesn't need coverage. So he's letting you hang.

IANAL, but I've been an exec who has had to walk in and clean up quite a few shops doing illegal things like this. Here are some options.

A) Just leave. Easier said than done, obviously. Also, he almost certainly owes you back overtime as well as back taxes that he didn't deposit consistent with the IRC.

B) Contact your state's version of the Labor Board. Explain the situation, and see if they're able to take administrative action on your behalf. This might be a good option for you, because these actions are usually sealed, and they'll order the employer to provide null references in the future.

C) Get a lawyer and sue. This can get very messy very quickly, and the real downside of it is that since your pay rate is only about $12.50/hr, even if a court awarded you a year's salary, an attorney on contingency would take half of it, and you'd still be boned. Also, future employers have a way of finding out about employee lawsuits, and it makes you somewhat more unemployable since there's nothing that says they can't discriminate against you based on your past history of litigating against employers.

Now, an interesting side option is that I suspect that you don't have an ironclad Intellectual Property and Inventions Assignment agreement with the company, given that he's a management slob. Odds are that it's buried in your contractor agreement which is, itself, a piece of fiction. There might be a severability clause in it, but I bet a judge would vacate the entire agreement if given the chance. That means that you possibly OWN the intellectual property of the company. Which is to say, in effect, that you own the core asset of the company since the IP and the client list are probably its only assets.

I can't speak for you to say whether you WANT to own this company's core asset, and certainly if you owned the IP and licensed it back to the founder, you'd have the joy of having to continue working with him for as long as that went on. But since the company is successfully signing customers and is turning over about $400k a year, that may well be a lucrative path to pursue.

Anyhow, the way you'd look into that is to contact the local branch of the nearest major municipality's bar association. Almost all of them have a referral service, and it's usually cheap or free. An attorney will probably give you an hour or so to go over the case and figure out if it's a good idea to act or just jump ship.

I wish you luck, and I hope your next employer appreciates you more than your current one does.

kochbeck,

I think your heart is in the right place, but if this guy sues his boss (from what we've read) his boss will fight him until time ends, he'll be broke, and his lawyer will be driving around his new car.

Suing always sounds great on paper until you actually do it, and if it's for any serious amount of money you start to see the nasty side of the legal system.

Don't waste the energy on it, just run away. Call into work and tell them you have Legionnaire Disease and never come back :)

The Family Medical Leave Act only applies to companies with 50 or more employees.

http://www.dol.gov/dol/allcfr/Title_29/Part_825/29CFR825.111...

I agree with all of your sentiments, however.

The 1099 versus W-2 gambit is dangerous. He could, in principle, claw back the entirety of the 1099 payments, including whatever you paid on as taxes, then adjust them to a W-2 and pay you back less W-2 taxes. You'd then have to wait until the next tax cycle to get a government refund on the 1099 taxes. Retroactive reclassification of money is a dangerous game unless you have big cash reserves and lawyers of steel.

The IP gambit is potentially career ending. All he has to do is take out a press release that insinuates you may have destroyed his business with lawyers out of purest spite. That press release will hang around on background checks forever.

If you need leverage, go after unemployment insurance. If you were watching the clock, then he should have been paying unemployment insurance on your behalf. The state unemployment bureaucrats are remarkably bitchy and tenacious about it, but the worst case expenses to the company are not enough to start a legal war over. They are, however, enough to get the attention of a paranoid tightwad.

Actually, the IRS has been cracking down on 1099 abuse. So, he doesn't necessarily need to get a lawyer, he could possibly just notify the IRS and let them come in with lawyers.

I agree with you that using the law is always a bit of a gamble. But the mere threat of calling in the IRS might be useful.

The IRS has not exactly been cracking down on abuse. A lot of the 1099 stuff has been double taxation: contractor/employee gets paid on 1099, they properly pay all taxes including self-employment, then the IRS reclassifies them as W-2 and collects a second round of taxes and fines from the contractee/employer.

Basically the IRS considers the employer guilty unless they can track down the contractor/employee and extract paperwork from them, even though the IRS already possesses the documents that conclusively prove innocence. I'm actually mildly impressed nobody has truck bombed them yet. Crazy as he was, the airplane dude had a point.

The lesson for contractees is that you pay estimated taxes for your 1099 contractors. If they have deductible expenses, they can take it up with the IRS on April 15.

I am confused by this:

"and I am still making around $500/week. Which, in the beginning was great. However over the past year I have moved out, bought a car (out of need, the other died), gotten married, and have had a child. (With a second one on the way.)"

Why would you have 2 children if you are making $500 a week? Does your spouse make a lot of money? Do you live in one of the developed countries, or a 3rd world country?

I'm having a hard time figuring out how it could be rational to have 2 kids while making $500 a week. And why have children at all if you are working at a startup? Most of my friends follow the rule that startups are what you try while you are single, but if you have kids then you should try to find something more stable.

Oh, I see this:

"He still gives all of us a 1099."

The 1099 is a form given out by the IRS in the USA. So you are in the USA. What the hell? Why would you have 2 kids on $500 a week in the USA?

You also write:

"Yet, he treats us like employees. We have required working times, usually 8AM - 6PM, we only get a half hour lunch with no other breaks, and are on-call 24-7. Honestly, those items don't even bother me that much. "

On the bright side, it is illegal for him to treat independent contractors like this, so you can sue him if you want. The IRS has been cracking down on exactly this form of abuse lately.

I'm fairly sure you can sue him and get him to pay the 15% for the Social Security tax.

You might be interested in this article:

http://www.inc.com/guides/managing-independent-contractors.h...

This article is actually aimed at the employers, but it warns them about the IRS re-classifying contractors as employees.

Some interesting bits:

"Legally, the contract is a key part of establishing a non-employee relationship, though it doesn't guarantee that the IRS or other agencies will agree that your contractor should not be reclassified as an employee. If the IRS deems an employee misclassified as a contractor, some states – particularly Colorado and Maryland – can enforce hefty tax penalties on the employer. When in doubt, consult the IRS's guidelines on the difference between an independent contractor and an employee here.

With the IRS estimating that 15 percent of the U.S. workforce is misclassified, you'll want to be firmly within legal grounds – and to document a work arrangement meticulously – when working with an independent contractor, so that there is no doubt about the nature of the relationship.

The basic rule, experts say, is that you determine the what and the contractor determines the how. You say you want a piece of market research or a graphic design turned into you by a certain date; the contractor decides how to create these deliverables, subject to your approval. It's important to outline specific goals, but the contractor must provide their own tools, equipment, and facilities to complete the work.

In probing the nature of the relationship, the IRS might examine the contractor's level of freedom, including setting his or her own hours, paying his or her own business expenses, and hiring support staff or assistants as necessary."

Thank you lkrubner for the article. I will be reading it over shortly.

He is located in Pennsylvania, and he's only 21 so its a bit odd that he's married with 2 kids...

You write:

"With this job I got myself into this nasty living paycheck-to-paycheck situation."

No, no. The job is awful, but that is not what put you in a paycheck-to-paycheck situation. Outside of New York, LA and San Francisco, a single individual can get by and be minimally comfortable on $500 a week. I've done it. When I was younger, I actually had some great times living on $500 a week. I could even save up for trips elsewhere. But having 2 kids changes things. A lot.

Having 2 kids makes it much more important that you immediately go find something that pays better.

> Having 2 kids makes it much more important that you immediately go find something that pays better.

And that is where I am headed.

A warning:

lawsuits

Do not be surprised if your "boss" freaks out and threatens you with a lawsuit. He will probably be bluffing. You need to just ignore him and ride out the storm.

I actually had a boss like this once. Not quite as pyscho, but still in the same orbit of madness. What worked for me was quiting. Every time I quit he offered me more money. I went back 4 or 5 times. Over the course of 4 years, my pay went from $15 an hour to $50 an hour.

Mind you, it was important to really quit. Bluffing did not work.

If I said "I will quit" he would say "I am sorry to hear that but we have no extra money that we can pay you."

Only when I quit and went and got another job did he offer me more money.

There came a point when I realized that simply working for him was bad for my career. No matter how much money he paid me, his business was run on a profoundly unprofessional basis. It was never going to lead to something great, and every day working with him was a day spent learning how to deal with a psycho, rather than a day spent learning how to deal with a professional, well run business.

So in the end I quit, and he could not offer me more money to stay.

That is when he started threatening me with lawsuits. These came in 2 varieties:

1.) My non-compete agreement - he briefly argued that my non-compete agreement covered the whole technology industry, so I was not allowed to go to work as a computer programmer anywhere. This was a really a non-issue, partly because no court would uphold such a broad claim, but also because the non-compete agreement had a 2 year limit and when I quit we were only a few weeks away from the end of those 2 years. So the issue just went away.

2.) Copyright. He had stupidly never asked me to sign anything regarding copyright. So I owned the copyright on any code I'd written while an independent contractor for him. He then argued that we had had an implicit agreement, and that he would sue me if I ever re-used the code. But I re-used the code on another project, and he never sued me.

One thing about these kinds of bosses: they crave control. When you quit, they go wild, because you regaining control over yourself. At such times, such bosses go a little crazy. It's best to ignore most of what they say at such times. 99% of the time, it is all bluff.

As alexwyser said, I'm a bit odd.

My wife first got Pregnant a few months after I got this job. (I worked there a bit over 14 months now. The first two months were really just be doing a design or two. for them.) Before this job the money from the other startups was even more sporadic. This, was almost a relief, having a solid amount of money per week at a job where I could do what I liked. (The area has few other tech companies.)

And you are completely rational in saying that it is irrational to expect to live on $500/week with two kids. However it is absolutely possible to do with one child, trust me. At the time this was the safest thing for us to do. My wife breast feeds, cloth diapers, and stays at home with our daughter. (If you ever have a child the first two will save you a significant amount of money.)

We just found out about the second child being on the way. This plays into my emotions and thoughts on having to do something about the situation I am currently in.

BTW, you should check out the who's hiring thread: http://news.ycombinator.com/item?id=1438505 even the older ones like these: http://news.ycombinator.com/item?id=1215633

and my freelancing partnership offer is always there, and is something I hope you'll consider.

Will do! Thank you. :)

I hope you got some valuable experience here. Some bad, some good. Some development, some software, etc. Be abused and say "No" - is GREAT experience too. You are set here. It's definitely no reason to work for such compensation.

1) Silently find a new place to work. (there is no reason to negotiate with your current employer, since he wont be able to raise compensation 4 times and give you all other stuff for sure) 2) Tell founder that you are leaving in 1-4 weeks. 3) Tell him why you are leaving. 4) Tell him that he have option to hire freelancers (you are freelancer now accordingly to way he pays you) on oDesk.com, elancer.com, etc sites. He will get really good quality on these sites and in the same time these $500/wk wont be abuse to these people.

I mean, if you are really good, and it looks like you are, you should fight for much better compensation/results for your - you have wife and kids now!!! And in the same time if your employer can't pay enough you - he should rebuild his business to outsource some work to other countries to not abuse local people.

Update: Thank you all for your help and blunt honesty in this matter -- I deeply appreciate it. Taking your advice I am wrapping up a few final projects I have outstanding and updating my resume. I will keep you all posted on the outcome of the situation with a blog post that I will post to HN later this month. Thank you again for your time, advice, and support.

Unless you have significant equity, you need to immediately negotiate higher pay or leave.

* $500/week is ridiculous. You are way underpaid.

* There is no upside for you:

  * Say the company is successful and starts generating a lot of revenue: you'll have to crawl your way from $500/week to a decent salary. New employees will immediately make more than you.

  * If the company is sold, the founder gets rich and you get nothing.

You've accomplished significant milestones: you've taken a product from idea to production, and you are now managing a team. Play this up in your next interviews, you've earned it. Get yourself a better position with better pay, in line with the skills you've honed and proven over the last year.

Btw, I've founded 3 startups so I'm very familiar with what it's like to pay people little. In every case the counter to the low pay was significant equity - if the startup makes it, you get a share of the prize. If you're not getting equity, you're getting used, plain and simple.

Hi,

I have a Master in Human Resource Management (on top of a IT degree and an MBA). For me, your case is a clear case of tacit abuse.

If the product you are working on is now selling, then it means you MUST have some good skills somewhere. Fact is, you are the one who has the power, but it seems to me (and I don't mean to be rude) that you don't have the guts to use it.

If I were you, I would start searching for other positions offering a much better salary for your skills. Then, come back to your company and ask for a decent raise. If you don't get it, move to the next job and don't feel guilty about it. They are not treating you decently.

You have a kid and a family to take care of.

I understand the need for sacrifice in start-up and the need for long-term commitment, but it still does not add up to me. It does not seem like you have shares in this company. If it becomes very successful, will you have a piece of the pie, I mean FOR SURE? Or are there just mere promises?

Take care of yourself and push back on this crappy situation.

That is my advise.

While it is not something I would suggest in most situations, this guy seems close enough to pond scum to deserve it. (Personal note: at my first programming job, decades ago, I was paid from the owner's wife's personal checking account for the last few months, after one of my company paychecks bounced. While I'm sure there was some tax fraud going on there, I didn't see any reason to cause the guy any more grief than he was already going through.)

After securing further employment, turn him in to the IRS, with as much supporting documentation as possible.

See http://www.bankrate.com/brm/itax/news/20030221a1.asp for a bit more info on the IRS bounty program.

If you would feel guilty about the impact on the other "contractors" at the company, share any eventual payoff with them.

I am a close personal friend of datawalke. I consider myself a capable (just capable) programmer and my abilities pale in comparison to his.

My primary knowledge is of philosophy. What this has allowed me to do is come to the conclusion that programming is an extension of datawalke's very being. He doesn't just work as an IT guy. His very existence guarantees both his programming ability and its perpetual growth.

I know for a fact that he is grossly underpaid and devalued. What he hasn't mentioned is that even on top of this job he works frequently on side projects for clients who have never been dissatisfied (to my knowledge). I honestly believe that he simply sleeps less than everyone else as a solution to his lack of time.

I'm a founder and I'd like to throatpunch your employer. Everything that has been already said is true. What he's doing is illegal.

And hey, if the opensource CMS in question is Drupal, shoot me an email, I'm always on the prowl for good Drupallers.

You need to put your email address in your profile so others can find it.

Done. Thanks. :)

Just make sure to never treat your employees mine has treated me!

And I wish it was Drupal, he refused to move away from .NET. I will say the CMS we used is the worst experience I ever had. It is horribly bloated.

Oh, I feel for you there. Is it Kentico or DotNetNuke? You may not be able to answer to protect your anonymity, but my condolences if it is. We've done cleanups jobs for both of those and...oh, the kludge.

I've been treated (exploited?) in much the same way as you have in the past; it sucked at the time but I'm a better carer-and-feeder for developers because of the experience. :)

You need to have a new job. In so many ways. I got a sysadmin "internship" right out of college with a studio art degree (painting) and was make $3K a month. And for a company that I feel is extremely exploitative of its workers. I completely agree with everyone. You can feel completely entitled to making 4-5 times what you are, salaried with benefits. Also, your boss is obviously just an ass. Only someone on the megalomaniac end of the personality spectrum would be calling you to task for showing up a few minutes "late", especially when you are a contract worker.

I would give him an ultimatum, either quit you job right now (since you're not an employee you don't even have to give a two weeks notice) or get 2 times your salary.

After that, regardless of the outcome start looking for another job, because once you have forced his hand like this the founder is likely to find a way to not need you anymore and fire you sooner or later...

Because he needs you, he's likely to agree to your terms (as long as you don't repeat it to another), and you'll be in a better financial position while looking for a new job

The only way to get paid the correct amount you "really" deserve is to be a founder yourself. But it is definitely not the easy way.

The founder is clearly exploiting you, but he sure has justifications in his head. Something like, it was all my idea, I took the risk, it was my execution, etc.. etc.. I think you must negotiate with the founder. Basically a bit of everything that you just wrote above.

"The only way to get paid the correct amount you "really" deserve is to be a founder yourself."

If you make something that it turns out people don't really want, though, you could get paid nothing. While that's the amount you really deserve in some sense, I can see the appeal of hedging that by letting someone else take most of that risk/reward, which is what all employees do.

Also another piece of advice...I would aim for at least 60k$ a year in your next job (but tell them 65-70k$) based upon your 2 years of experience and you are not in a major metropolitain area...but due to the fact that you do not have a completed degree, especially a university one, I would expect it to be harder to negotiate salary terms.

As a hiring manager in at least 5 companies, A degree has never been a deciding factor in what I pay a new employee. Years of experience played a far larger role.

Sure..and it shouldn't if you could make them go through your tests. But regardless, not having a degree can get you easily screened out of a lot of jobs

As one of the key early employees who took a pay cut to make things work you really should get stock or stock options.

Trust your gut (and your wife) you will.

Then "...the universe will open doors where there were only walls." - Joseph Campbell

>> I am still making around $500/week. Which, in the beginning was great.

No it is not. You are underpaid - exploited.

I am making $400/week (4 hours/day for 5 days/week) on my freelance and I am living in the Philippines. You are in the US and supposed to earn 4 - 5 times as much.

Let people know which are of the world or states you are in, and perhaps they can provide employment for the whole of your team.

It sounds like you are very hard working, so anyone will be happy having you in their team.

Do you have equity in the company, that keeps you there?

No equity.

I am trying to keep this post fairly generic, however we are located in the Northeastern United States Lower than New York, Higher than Maryland ;)

What everyone else said and also: GET OUT, GET OUT, GET OUT! If you MUST, ask for a raise to at least 80K per year but most likely he'll never respect you. Take your hard earned experience as a dev & manager and go get a real job!

I don't know if my comment is valuable, but in Brazil we have some good laws to protected the employee, but the salary isn't so high as yours, from outside Brazil. (sometime those laws work well)

Here, it would be illegal...

[]'s

Which web technologies do you work with? Drop me an email or phone call. Contact information is at http://letterblock.com/ .

To chime in - get out. What the owner is doing is illegal as well as unfair.

As for not wanting his business to fail, I agree taking intentional actions to cause harm would be bad, but I suspect they'll cause themselves enough harm simply by you not being there soon after you leave.

From the other side of the table, I employed a handful of people in the early 2000s. We had a couple good years, and then a couple bad years. Got the point where the money wasn't coming in regularly, and I had some people stay well past the point where it was good for their own financial well-being. While I appreciated the loyalty (whether to me or solely to the clients, I'm not 100% sure) but I did tell them to leave if they could find something else, or take side work, or something.

I would never want to be in a position where I was doing what's happening to you to someone else. I've been in situations where I've been exploited, but not to this level, and it sucked, and I got the heck out as fast as possible once the reality set in.

I would suggest expanding the freelancing. You don't have much time right now cause you're working 50+ hours per week for someone else. It should not be hard to replace what is effectively a $10/hour job with some extra freelancing work. I've had a friend of mine recently jump from 'job' to fulltime freelance, and while he's not booked up 100% of the time, he's increased that hourly rate, so just to keep up with where he was before he doesn't need to bill full time.

Go back to your current freelancing clients, and explain that you'll be on the market soon. Ask if they have any extra work they need doing, ask them for referrals to other colleagues they may have who need what you do, and then ask them to be a reference. Preferably something in writing - a predone text file that you can use on your website and to include in your email marketing for new work.

Update your linkedin.com page, and hit up your network there for more work.

Finding work, especially as a freelancer, is very much about your network, and you have to curate that aspect of your life with intention and purpose. Happenstance and serendipity are great - they've brought some great things in to my life - but it's not enough. Hope is not a strategy. :) Start (re)developing your professional network outside of your current employment situation, and watch your freelancing grow.

Maybe freelancing only tides you over for a few months, and you manage to land another f/t job. Don't ever forget that you're still in charge of your own career and life. Your current situation should help drive that home for a long time, but don't dwell on it. Use it as motivation to build your professional network so that you never have all your eggs in someone else's basket again. Own multiple baskets. Even if you don't put eggs in any for long stretches, they're still your basket.

Best of luck to you, and I hope things turn around very quickly for you.

Freelance may be my best choice at the moment. I do however have to make sure I have a little more in the bank before I make the jump if I don't have a full time position lined up. Instead of killing myself with extra side-work raising my freelance rate may be in order just to have a little bit more of a cushion. If I didn't have a family to care for I wouldn't be as worried.

Thank you for your advice.

It's hard to raise rates on existing clients in a short time frame - giving them some notice (3 months?) would be more professional. Your current predicament is not their problem, really. However, if you could offer extra services (like, you never did DB work for them, now you'll do DB work) having a different rate for different types of work is more palatable.

Oh, I mean raising my rates on new clients only. The rest of my clients would receive an early notice.

Do not work for less that 40hr freelance. The agencies are charging no less that 80hr for you if you go through them and charging less than 40hr gives the impression that you are an amateur. Realistically, you should try to get what an agency would get if you have a direct client. When I have too much freelance work, and my regular peers are booked up. I always look for the guys that are in the $80-120 range. There are some hacks that have the audacity to try and get that rate, but for the most part those are the rates of a good self-starter that you know will be able to take the ball and run with it. If I am looking for another hand on a project that I am running, I look for the $40-60hr guys.

I think your mindset is that if you leave now, your boss wins (having underpaid you all this time). Right?

Get them to pay you right or get out. Maje sure we all know the name of the company - after you left.. :)

If you end up quitting, please name the company so that everyone else can avoid getting cheated.

How come the asshole bosses always end up finding people that will 'take it' ?

You probably already know the answer if you have talked to a tax accountant..if they set the hours than its employee and they need to withhold taxes.

First, find some other projects/gigs to cover your expenses and do not tell the startup.

Second, when those other gigs are secured ..spend $150 on a CPA that does tax work..have him compose a letter stating that under work conditions at startup that they need to state you as employee and withhold payroll taxes. Give cpa any docs that he needs to document this.

The purpose is not to force startup to do anything. it sot protect you and your family.

From now on, if firm sets working, hours, and has full quality control of the work than you need to only accept w-2 employee status.

Your local cpa will have a employee/ tax check list as far as conditions make it employee and which ones do not so ask for that.

if you cannot afford he $150 to $250 ask your local CPA state board or SBA office to give you a list of those CPAs that sometimes do free advice workshops on this.

And most important do not under any circumstances let the startup know your anger..just get the extra gigs so that you can get out of the situation.

S the project manager I am using know states, you have to care about the money as the right startups will than take that market rate of a freelancer(no not salary rate) and say well we can do 75% and pay rest in stock is that acceptable and as employee.

This type of post brings out the best of HN.

I'm sure you're great, but I'm sick of seeing: "I have been doing web work since I was nine."

What's up with this? I was probably the most technology savvy kid to come out of my high school, and I'm still not even remotely close to saying something like this!

I bet that when you were 9, you couldn't even do most advanced algebra, let alone real web work.

I'm sure your great as well!

Hell I'm 21 and I still can't do most advanced algebra. When I was nine my passion started working in GeoCities and Tripod. I don't know any nine year old who can actually do real web work. ;)

> I bet that when you were 9, you couldn't even do most advanced algebra

I'm confused. Are you suggesting that your average 3rd grader should have already finished linear algebra? You do realize this means they did calculus and integrals in 1st grade, trig in kindergarten, and algebra in preschool, and learned long division when they were 3, right? Many 3 year olds don't even know how to read yet, and some aren't even solid on English. Or wait, did they learn that in the womb?

Wait, when was advanced algebra required for web work?

I'm not actually sure why I posted this. I was drinking that night, so I'm sure that had something to do with it.

Sorry guys!

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