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The Permatemps Contretemps

By: Ron LieberWed Dec 19, 2007 at 12:18 AM
It is the dark side of Free Agent Nation. Here's how the mix of Microsoft's human-resources policies, unwilling temps, high-tech union organizers, and "permatemp" agents produced unintended consequences -- and a cautionary tale.

Sylvia Moestl: The Unwilling Full-Timer

When Sylvia Moestl graduated from the University of North Carolina in 1989, she was an interdisciplinary-studies major with little background in technology. For several years after college, she traveled abroad and did volunteer work. She then returned home to Charlotte, where she found a temporary job at a Microsoft technical-support facility. After six months of hard work, a long evaluation process, and several interviews, she got an offer from Microsoft for a full-time position, making her one of 5 temps in her group of about 80 that the company hired. In 1994, Moestl pulled up stakes and moved to the Seattle area.

For most young people with technology smarts in the pre-Internet 1990s, landing a full-time job at Microsoft would have been a chance-of-a-lifetime coup. But for Moestl, the full-time job soon became a daily reminder of the attraction of free agency. "I was always on the phone with people who had skills like mine, and who were making four times the money that I was making," she says. Her new job did come with some Microsoft stock options -- but not enough to make her feel either destined for riches or trapped by golden handcuffs. "Talking to all of those people on the outside got me completely in tune with the idea of moving on to do my own thing."

Moestl, now 32, undoubtedly would have made more money in the long run had she stuck with her full-time job and garnered even more stock options. But when she made her decision to quit her full-time job, she wasn't thinking only about her income. She was looking for work that fit her interests, and she felt uncomfortably pigeonholed while she was working in the technical-support department at Microsoft.

In the fall of 1995, Moestl left Microsoft to become a free agent. Over the course of the next four years, she did contract work on five different Microsoft projects, playing a number of different roles and honing a variety of skills.

Even though Moestl hasn't done temp work for Microsoft recently, her job experience at the company and her exposure to the permatemps controversy left her with a strong opinion about the lawsuit. "Just because someone wants a full-time job doesn't mean that person is going to get one," she says. "The market has ways of regulating situations like this. There are job opportunities elsewhere, and if people are unhappy, they should take advantage of those opportunities."

As unsympathetic as Moestl is to the cause of the permatemps, the controversy has had a direct impact on her life. In February 2000, Microsoft announced a new permatemp policy: No temp worker would be allowed to stay at the company for more than a year without a break in service. In the wake of that announcement, many other local companies -- and companies elsewhere around the country that have been tracking this high-profile case -- decided to follow the practice to avoid becoming the next target of a class-action lawsuit.

"Some large companies are trying to avoid hiring any contractors at all," says Moestl. "And there are others who don't want to risk giving a contractor longer projects to work on, because they're afraid that they might be sued if contractors think that they're doing full-time work for them. All of it directly affects my bottom line and my ability to choose the way that I want to work."

Barbara Judd: The Unwilling Permatemp

Two years ago, accepting a temporary assignment at Microsoft seemed like a pretty good bet to Barbara Judd. An MBA, Judd, who was in her late forties at the time, was one of what would eventually become 60 temps who signed on to help the company develop a piece of software that was designed to compete with Intuit's popular TurboTax program. What Judd really wanted was a full-time job at Microsoft; taking a temp position would at least get her foot in the door, she figured. "The company made it clear to us that there were no guarantees that the project would succeed," she says. "But my take on temp work has always been that it's a good way to prove yourself to an employer. Plus, it was a chance to work on a piece of software from the ground up. It's always more exciting to build than it is to fix. I saw that job as a chance for me to be a pioneer."

One year later, Judd was still a temp and was still working on the same project. That was when she attended an annual meeting of the Institute of Management Accountants in Seattle -- and inadvertently found out how at least one high-ranking Microsoft executive really felt about permatemps. Greg Maffei, then the chief financial officer of Microsoft, was the speaker at the summer event. At the end of his remarks, an audience member asked him about the company's use of temps, and Maffei fired away. "We are very tough in hiring [full-time workers] in terms of standards, but we aren't as tough on temps," he said. "So you found that the quality of the temps is not as good as the quality of the full-time people."

From Issue 37 | July 2000

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