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NY To Replace IT Vendors With State Workers

Soulskill posted more than 4 years ago | from the this-can-only-end-well dept.

Government 178

dcblogs writes "New York state plans to replace as many as 500 IT contract workers with a new type of temporary state worker. The state estimates it can save $25,000 annually for each contracting position that is in-sourced. This is the result of a new law creating 'term appointments,' which strip away some hiring and firing rules that apply to permanent state workers. These term appointment workers are employed 'at will.' Term appointments can be up to five years and workers get state benefits. Proponents of this change said a state IT worker might earn an average of $55 an hour, including benefits, while the state pays its contractors an average of $128 an hour for workers in similar jobs."

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Wow (0, Redundant)

Anonymous Coward | more than 4 years ago | (#31456010)

This is the result of a new law creating 'term appointments,' which strip away some hiring and firing rules that apply to permanent state workers.

Government declares that laws don't apply to them... news at 11

Re:Wow (2, Funny)

drachenstern (160456) | more than 4 years ago | (#31456106)

Can we just restrict this meme to idle posts?

But in other news, /. lurkers find new ways to recap summary in one sentence, stay tuned for more info!

Re:Wow (5, Insightful)

natehoy (1608657) | more than 4 years ago | (#31456260)

How so?

If they were taking full-timers and laying them off then rehiring them as contractors (with no benefits) that's clearly illegal - it's a process called "conversion".

But they are simply saying that jobs that are currently filled with a contractor will be filled with full-time "at will" employees now. Contractors are already "at will", and the contracting firm is (in theory) paid a lot extra because they can rapidly add or subtract resources as needed. You pay extra for the flexibility. Flexibility which, in this case, the state doesn't need as much.

Now the state is saying "we have people that we know we'll need for 5 years or so. We can't hire them full-time under existing State terms because we cannot eliminate their positions when we don't need them any more, but it's terribly expensive to hire them for 5 years at about triple what they actually get paid." That $128/hr contractor MIGHT be getting paid $45 an hour with benefits. Their firm takes the rest.

I can't even see the State union getting upset about this, these employees will likely be Union members, with the only exception being they have a fixed term of employment rather than "employed until retired or dead" like most State jobs. But it beats working for the contracting firm.

About the only people I can see getting upset about this is, well, contracting houses.

But the State is large enough that it really doesn't need the assistance finding talent, and the employment terms are long enough that people will still jump at the chance. I mean, c'mon, how many people in "real world" IT last more than 5 years in a given job? My record, after over 20 years in the field, is 4 years 10 months, ending in a layoff. I'm really hoping my current employer is "the one I retire from", because they are really nice folks to work for. But lifetime employment is nearly unheard of nowadays.

Re:Wow (1)

PopeRatzo (965947) | more than 4 years ago | (#31456362)

that's clearly illegal

Is it just illegal because government is doing it?

Private corporations have been doing this for years.

But lifetime employment is nearly unheard of nowadays.

It's only "unheard of" in countries where the corporations run the government. Funny, but in the empoverished Socialist third-world hellholes like Germany, or Israel or Sweden, a person staying with the same employer for a lifetime is not uncommon.

Re:Wow (0)

Anonymous Coward | more than 4 years ago | (#31456560)

Yea, like those socialist countries don't have some serious problems..... Socialism sucks

Re:Wow (5, Interesting)

CohibaVancouver (864662) | more than 4 years ago | (#31456892)

Yea, like those socialist countries don't have some serious problems..... Socialism sucks

You know, in the 21st century, using supposedly negative terms like "socialist" are pretty tired. The USA is one of the most 'socialist' nation-states going. The USA spends more per-capita on health care than bogey-man "socialist" countries like Canada and spends billions (trillions?) buying banks, car manufacturers, you name it.

In the USA, the government sticks its nose into who can marry who, spends billions of your dollars saying what drugs people can use, asks me at age 43 for ID when I try to buy a bud lite, posts stupid useless warnings on foods & menus, has ridiculous zero-tolerance policies at schools, goes crazy if Janet Jackson's tit 'slips out'... (think of the children!) and on and on. You won't find many more socialist nanny-states in the world than the USA...

Re:Wow (2, Insightful)

Miseph (979059) | more than 4 years ago | (#31457154)

Fun fact: everywhere has serious problems, nothing is perfect. Of course, if you don't pretend that an improvement must lead to perfection in order to be meaningful, you start to see where maybe our system could be better.

The important question isn't "does the alternative have problems?", much more useful to ask "would we rather have the set of problems belonging to the alternative, or the set of problems belonging to the status quo?"

Capitalism sucks too.

Re:Wow (1)

beakerMeep (716990) | more than 4 years ago | (#31456904)

It's illegal in the private sector too. Microsoft got dinged for $100M for doing that. MTV / Viacom too iirc. It gave rise to the term "permalancer."

Re:Wow (2, Informative)

Lumpy (12016) | more than 4 years ago | (#31456364)

That $128/hr contractor MIGHT be getting paid $45 an hour with benefits. Their firm takes the rest.

There is no Generic IT grunt getting $45.00 an hour in New York. They are getting $21.00 MAX.

Re:Wow (1)

ShadowRangerRIT (1301549) | more than 4 years ago | (#31456562)

Depends on your definition of "IT". A lot of "IT" jobs with required programming skills (basically software developer jobs with a side of support) pay that much. Depends on what you're doing, in what industry, and in what part of the state, but given that a family health care plan in NY costs around $13,000, you're getting $6.00-6.50 an hour just on health care benefits. The people I know working these combined "IT/programming" jobs in NYC are often getting $100K in salary (off a B.S. and five years of work experience), which is another $50/hour right there. $45 is not at all unreasonable.

Re:Wow (1)

MaximvsG (611212) | more than 4 years ago | (#31456886)

Really depends on the type of contract work they are doing. Working for a company like CSC who manages contract and pays employee benefits, a W-2 contractor that works for what is basically a head-hunting company that provide no benefits or a 1099 contractor (essentially self-employed.) Having done all three I can say a skilled IT worker (W2 or 1099) in NYC should be getting no less than $60/hr. I realize the market has slowed down considerably since the heydays of the late 90's, but rates have rebounded the last few years. We had something similar happen at T Rowe Price where all the contractors were let go to save money. Most were charging over $100/hr.

Re:Wow (2, Informative)

skids (119237) | more than 4 years ago | (#31456654)

Pretty much. I used to work for state IT. I'd cringe every time a pointy-hair brought in a contractor, knowing just how much tax money was going up in smoke for someone with no better skills than their permanent employees had -- and there was almost always a contractor doing something, so they could have FTEd that work if they could have got the paperwork through. there were a few of these contractors that actually made good money, but only through generous travel reimbursements. The rest were getting shafted compared to what their employers were charging.

Re:Wow (4, Interesting)

PopeRatzo (965947) | more than 4 years ago | (#31456294)

Oh, you don't like "free markets"? The government shouldn't look for ways to save money?

It's funny how quickly the most staunch conservative turns into Michael Moore as soon as it's his well-being that's threatened.

Re:Wow (2, Insightful)

wealthychef (584778) | more than 4 years ago | (#31456516)

Interesting post. Because he complains that government doesn't obey the same laws as the rest of us, you assume he's conservative. Huh. Or was there something else that tipped his hand? I gave up labeling people a while ago, so I've lost track -- do good liberals nowadays not favor government obeying the same laws as the rest of us?

-1 Reactionary (1)

ShadowRangerRIT (1301549) | more than 4 years ago | (#31456636)

-1 Reactionary: I'm pretty bleeding heart on most issues, but try as I might, I'm not seeing how the GPP indicated his political affiliation, or did anything other than point out a very mild form of hypocrisy (which I don't consider all that hypocritical, since the government is merely subjecting itself to private industry rules instead of the usual more generous government rules).

Anti-Union (1, Troll)

Yossarian45793 (617611) | more than 4 years ago | (#31456024)

State employees have one of the most powerful unions there is. This is the thin end of the wedge to destroy it. Whether you are happy about this or not depends on how you feel about unions. I, for one, welcome this as a step forward for government employment.

Re:Anti-Union (4, Insightful)

geekoid (135745) | more than 4 years ago | (#31456120)

yes, because instead of creating an environment of 40 hours being the norm, lets make everyone work 70 hours a week. That's a win~

Re:Anti-Union (3, Insightful)

JDAustin (468180) | more than 4 years ago | (#31456246)

The fact remains that unionized government employees are paid 10-20% higher then private sector counterparts and have 4x the benefits package (about $9500 annual in the private sector vs 38k in a fed gov job). Many of the states who are bankrupt are so due to escalated costs of state employees.

Re:Anti-Union (1)

HungryHobo (1314109) | more than 4 years ago | (#31456290)

First we save money by outsourcing to other companies and then a few years later we'll save even more money by in-sourcing!
It's brilliant!

Re:Anti-Union (4, Insightful)

hazem (472289) | more than 4 years ago | (#31457222)

Ever worked for a consulting company?

If you go in and see that a company has a centralized structure, you try to sell them on decentralization. If they're decentralized, you try to sell them on centralization. If they out-source, preach in-sourcing; if they in-source, preach out-sourcing.

Oh, and in both cases, we have just the products and the consulting teams to help you achieve a synergistic paradigm shift to streamline your enterprise and facilitate a win-win situation with end-to-end empowerment for your core team.

how about a little disclaimer, mr SAIC (0)

Anonymous Coward | more than 4 years ago | (#31456296)

SAIC gets huge money from govt contracts, please expain to me how this has not biased your opinion here.

Re:Anti-Union (3, Informative)

nicolas.kassis (875270) | more than 4 years ago | (#31456348)

Actually, I've worked for a state government and never seen an IT postion paid better than in the private sector, including benefits. In fact they usually were getting 10-20% (low estimate) less than the private sector would offer. A dba in state government will rarely ever (don't know any) get the average salary of the market.

Re:Anti-Union (1)

Nexzus (673421) | more than 4 years ago | (#31456520)

Western Canada, Regional government union IT worker here, 2.5 years in. I'm a deskside tech. I make 73K per year, plus another ~10% standby pay.

Re:Anti-Union (1)

CorporateSuit (1319461) | more than 4 years ago | (#31456592)

If you're having trouble finding an IT position that pays less than $120/hr, then I need to move to wherever the hell you're living. I thought wages in CA were high, but apparently you live in a place where IT smokes cigars made out of rolled hundred dollar bills!

Re:Anti-Union (1)

Tsunayoshi (789351) | more than 4 years ago | (#31456740)

State is paying the contractor company $120/hr for IT employees....the employee is not making $120/hour (unless said employee is a self-employed consultant under contract as opposed to being a W-2 employee w/ a contractor agency).

My company charges around $96/hr to the government for my services. I am definitely not making that much per hour.

Re:Anti-Union (5, Informative)

PopeRatzo (965947) | more than 4 years ago | (#31456452)

Many of the states who are bankrupt are so due to escalated costs of state employees.

That's only one of the three assertions in your post that are factually incorrect. Except for those three false items, you're right about everything else.

It's actually the pensions that are causing so much trouble for the states. And the reason that the pensions are so high is because starting about 30 years ago, management thought they could safely screw workers by offering them high pension benefits instead of higher pay. Then, when people starting living longer than the actuarials were predicting at the time, management realized its error and started demonizing the very contracts that they pushed.

In every single case that I've looked at, the unions were actually looking for higher pay and went with the pension benefits when management stonewalled. If management hadn't tried to screw workers to begin with, this wouldn't have been such a problem.

This goes for public employee unions as well as automobile companies and other large employers.

Re:Anti-Union (1)

Night64 (1175319) | more than 4 years ago | (#31456564)

Yes, and I'm sure that you have independent data that supports your story. Also, you can't compare a fed gov IT job in, let's say, NSA with an IT worker in Papa Joe's furniture shop. Specifically, which US states are paying 20% higher than private sector for IT positions?

Re:Anti-Union (1, Insightful)

Anonymous Coward | more than 4 years ago | (#31456586)

The fact remains that unionized government employees are paid 10-20% higher then private sector counterparts and have 4x the benefits package

In other words, the best and the brightest should be attracted into government positions. This is good for efficient government.

Many of the states who are bankrupt are so due to escalated costs of state employees.

Union wages were sustainable 40 years ago and have held steady or fallen since then. The real story is the collapse of the American economy through globalization which has led to lower tax revenues through reduced incomes across the board. A secondary cause of state bankruptcy is that taxes on the rich have been sharply reduced over this period.

Re:Anti-Union (1, Informative)

Anonymous Coward | more than 4 years ago | (#31456652)

The fact remains that unionized government employees are paid 10-20% higher then private sector counterparts and have 4x the benefits package (about $9500 annual in the private sector vs 38k in a fed gov job). Many of the states who are bankrupt are so due to escalated costs of state employees.

Your facts are wrong. At least where I live (California).

Speaking from personal experience on both sides of the fence, state technology workers make 10-20% less than private sector employees at similar positions. The state employee however has better job security (once you pass your probationary period it can literally take an act of congress (state legislature anyway) to terminate you). Your job must be eliminated, unless some extreme misconduct is proven. State employees have more paid holidays than most private sector employees. State employees also have a pension plan instead of a 401K. Other benefits, such as medical/dental/vision, were exactly the same.

Re:Anti-Union (1)

ShadowRangerRIT (1301549) | more than 4 years ago | (#31456778)

Citation needed. I've worked a U.S. federal gov't jobs and private sector jobs. Same basic skill set required for all of them, and the gov't job required a hell of a lot more in the way of continuing education to perform due to the nature of the work. In base salary, the government paid about 20-40% less. Health benefits were more costly, with higher copays and less generous coverage; I can't say how much it cost the government, but I'm guessing it was less. The retirement match was better in percentage terms, but when you applied it against the lower base pay, it all came out in the wash. The two things gov't work was better at were:
  1. Maximum hours per week; flexible work scheduling (if you worked over 40 hours, you built up time off; you couldn't cash it in, so it was a form of mandatory vacation)
  2. Better education benefits (when pursuing degrees that relate to your job, they'd pay you for a year while you pursued the degree). Of course, as noted, the job required a lot more knowledge than a typical B.S. provided, so the education benefits were necessary since most people would have a hard time learning all of it on their own

My friend worked a nearly identical contractor job that replicated the duties of the public sector workers, and while his own pay and benefits were only slightly better, his company charged his time at well over twice what he was paid.

Re:Anti-Union (1)

dave562 (969951) | more than 4 years ago | (#31457204)

The fact remains that unionized government employees are paid 10-20% higher then private sector counterparts

Do you have any supporting documentation for that claim? All of the State workers that I know went to work for the state for two reasons. The first is job security. The second is the benefit package. In California state workers make considerably less on an hourly/salary basis than their private sector counterparts.

Re:Anti-Union (2, Insightful)

Radical Moderate (563286) | more than 4 years ago | (#31457330)

God forbid that anyone but corporate execs make a decent living. And I've never seen that 10-20% higher figure before. Might be true now that companies are cutting back so much, but it's not the rule.

Re:Anti-Union (0, Flamebait)

SatanicPuppy (611928) | more than 4 years ago | (#31456374)

Never seen a state or a union employee work 40 hours in a week.

Re:Anti-Union (0)

Anonymous Coward | more than 4 years ago | (#31456642)

40 hours a week is the lazy man's myth. You'll never be successful on 40 hrs a week.

I'm all for this concept, too .... (1)

King_TJ (85913) | more than 4 years ago | (#31456674)

Although actually, I'm not clear on why you're so confident this is a move to "destroy state employee unions"? This wouldn't seem to displace any actual state employees. Rather, it makes a change so the contractors they now outsource (instead of actually hiring state employees who would be part of a union) would be substituted with temporary employees, paid half as much as the contractors were costing them.

Personally, I think contractors are generally "bad news" when it comes to government projects. They inflate costs and take advantage of the fact that their paychecks come from the taxpayers. (Once they "win a contract" to complete some project, they know they're getting paid for a while. They can slack off or just learn what they're doing on the job. If the project goes over budget or collapses completely, they just walk away at the end of the contract period, and let other people sort out the mess. Half the time, they even convince the right people that it wasn't their fault, and they get a second chance and more money to try again.)

When you're directly employed by the state, by contrast, your paycheck is subject to being cut off at any time, if you fail to live up to their expectations. Someone else is always happy to interview for the job opening to take your place, and the project as a whole goes on with or without you. If you're successful and save the govt. money or improve its efficiency, that stands to benefit you too. (They're not going to give a contractor a raise for doing a job well.)

Has all the upside of a contract IT worker (0)

Anonymous Coward | more than 4 years ago | (#31456026)

Plus the underfunded pension obligations passed on to the taxpayer.

Re:Has all the upside of a contract IT worker (1)

ircmaxell (1117387) | more than 4 years ago | (#31456464)

Minus the extra $25k per year that would otherwise be thrown away to the contract firm (or to the IT worker if independently contracted). So in the end, it works for a net win for the state (They could take that $12.5 million they just saved and push it towards the pension package, or reducing taxes, or paying off some of their debt, or something else useful)...

Re:Has all the upside of a contract IT worker (1)

PopeRatzo (965947) | more than 4 years ago | (#31456466)

Plus the underfunded pension obligations passed on to the taxpayer.

And why are those pension plans "underfunded"? Any guesses?

Oranges vs. Tangerines? (2, Insightful)

fahrbot-bot (874524) | more than 4 years ago | (#31456036)

Term appointments can be up to five years and workers get state benefits. Proponents of this change said a state IT worker might earn an average of $55 an hour, including benefits, while the state pays its contractors an average of $128 an hour for workers in similar jobs.

Of course, some of that $128/hour the contractor gets goes toward employee benefits... and the cost to the state will be more than $55/hour including benefits...

Re:Oranges vs. Tangerines? (1, Informative)

geekoid (135745) | more than 4 years ago | (#31456104)

What? the money they pay contractors goes towards state employee benefits?

That would be weird.

Re:Oranges vs. Tangerines? (1)

LearnToSpell (694184) | more than 4 years ago | (#31456540)

"Taxes," I think they call it.

Re:Oranges vs. Tangerines? (3, Informative)

Fujisawa Sensei (207127) | more than 4 years ago | (#31456122)

Term appointments can be up to five years and workers get state benefits. Proponents of this change said a state IT worker might earn an average of $55 an hour, including benefits, while the state pays its contractors an average of $128 an hour for workers in similar jobs.

Of course, some of that $128/hour the contractor gets goes toward employee benefits... and the cost to the state will be more than $55/hour including benefits...

More like $50/hour goes to the peon doing the actual job, and $78/hour goes to the contract holder.

Re:Oranges vs. Tangerines? (1)

nomadic (141991) | more than 4 years ago | (#31456366)

More like $50/hour goes to the peon doing the actual job, and $78/hour goes to the contract holder.

For $50 an hour, you could call me a peon.

Re:Oranges vs. Tangerines? (0)

Anonymous Coward | more than 4 years ago | (#31456612)

ffft, if that.

Most IT "contractors" that aren't actually running their own show *might* make $25/hr

Re:Oranges vs. Tangerines? (5, Informative)

blueg3 (192743) | more than 4 years ago | (#31456124)

It may not be true, but the wording they've chosen is saying that the $55/hr includes the cost of benefits -- not that the cost is $55/hr plus benefits. So you're comparing hourly cost including benefits to hourly cost including benefits.

Re:Oranges vs. Tangerines? (1)

Idbar (1034346) | more than 4 years ago | (#31457246)

Ah, but what I get from this, is that they are temps, and that hiring them as temps, they don't need to pay the same benefits as the permanent workers. So now, they get away with paying less for the same labor. Clever!

Now, how long until off-shored companies realize they can do that too and cut their costs?

Re:Oranges vs. Tangerines? (1)

dkleinsc (563838) | more than 4 years ago | (#31456132)

But presumably it's still less than $128/hr, which makes the change worth it. Although personally I'm wondering why they're pushing for making these folks "temporary". As far as I'm concerned they should just hire them as state employees and be done with it.

Unless, of course, there's a lot of efficiency coming from each of the contracting organizations having a separate sales, finance, and management team scurrying around trying to direct state money to their company.

Re:Oranges vs. Tangerines? (0)

Anonymous Coward | more than 4 years ago | (#31456358)

Although personally I'm wondering why they're pushing for making these folks "temporary". As far as I'm concerned they should just hire them as state employees and be done with it.

Once you are past your probationary period, as a state employee, you are secure in your job. In many cases it literally takes an act of (state) congress to terminate you.

Re:Oranges vs. Tangerines? (1)

rainmayun (842754) | more than 4 years ago | (#31456372)

Making them regular old unionized state workers makes them incredibly hard to fire, among other things. so you end up with a higher head count than you might otherwise, because you have to hire people to carry the dead weight.

Re:Oranges vs. Tangerines? (1)

nicolas.kassis (875270) | more than 4 years ago | (#31456380)

Temps are expendable positions, it's harder to remove full time postition. full time position are often assigned by the legislature directly to a department. You can't remove or add new ones at will. Temp position are different.

Re:Oranges vs. Tangerines? (1)

theghost (156240) | more than 4 years ago | (#31456696)

That's true and it makes perfect sense if they're turning these into 5-year positions because they won't need IT people 5 years from now. Anyone think that's likely?

This is an end run around unions during a time when unions are at their weakest bargaining position. Whether or not your political perspective sees that as a good or bad move, the only question that needs to be asked is "Is this a necessary step given the current fiscal climate?" Perhaps it is, but it's also another step in the ongoing "race to the bottom."

Re:Oranges vs. Tangerines? (0)

Anonymous Coward | more than 4 years ago | (#31457322)

If the guy at the DMV is useless, he doesn't actively hurt others' efforts. If the IT guy is useless, he is likely to create more problems for others to fix, thus being able to get rid of dead weight is more important in IT. Realistically, some level of IT people will be needed 5 years from now, but does anyone think that the ideal skill set will be the same? It allows the government to be more responsive to work on term based contracts - maybe server management gets easier, but more web content needs creating. Maybe the cloud becomes self-aware and they no longer need to do anything but swap out faulty hardware. It is nice to be able to easily adapt over 5 year spans than generational spans. I applaud the race to the bottom in government, and the prudent use of tax dollars (I would say mine, but I don't live in NY).

Re:Oranges vs. Tangerines? (1)

Mongoose Disciple (722373) | more than 4 years ago | (#31456386)

Without knowing how the math works in this case (based on having done contract development for government entities in the past; my experience may or may not be relevant here)... probably, state employees are entitled to a set of benefits and health insurance that are really good, vs. the probably not very good benefits the temporary workers will get.

Really good benefits are expensive. The government employees I last worked with, for example, had health care that paid for basically everything with no copays. For a private sector IT employee anything half that good is unheard-of.

Re:Oranges vs. Tangerines? (1)

PPalmgren (1009823) | more than 4 years ago | (#31456664)

Doing this will likely drive contracting costs down. We all know how much private companies make off of govt contracting jobs. Maybe this will make them a bit more realistic, and be competitive in 5 years?

Locking them in for 30 years only creates "guaranteed" jobs, and we all know what happens to efficiency in gov't positions like those. Firing people in from gov't jobs is notoriously difficult, this way they have an auto-fire mechanism and if they want them back, they can re-hire them. As dirty as it is, it works, and if the job isn't meant to be a lifetime position, it works even better.

Re:Oranges vs. Tangerines? (2, Interesting)

RulerOf (975607) | more than 4 years ago | (#31456166)

and the cost to the state will be more than $55/hour including benefits...

Well... duh. Assuming 40 hours/week and 4 weeks/month, that's 160 hours. I know a man who's recently retired and has some serious risk factors that put private insurance for him at $600+ per month, so assuming he's the high end of that... it's what, just under $4/hour more?

Round it up to $60/hour for the pay+benefits for each man hour they incur, and they're still more than halving their costs. That sounds like a win to me, and I'm not even into finance.

Still, are you claiming this is a bad thing? I personally think that IT departments should be insourced, but I guess I've never seen objective research that says such practices are wholly beneficial (or the other way around).

Re:Oranges vs. Tangerines? (1)

PopeRatzo (965947) | more than 4 years ago | (#31457078)

I know a man who's recently retired and has some serious risk factors that put private insurance for him at $600+ per month

That's actually quite low.

If I had to go out on the "free market" to buy health care, I'd be paying about $1100 per month. For myself. And except for an unhealthy appetite for the triple chocolate cake from Alliance Bakery over on Division Street, I'm in good shape.

I've got a friend who's a martial arts instructor and is in the best shape of any 50 year old I've ever met. When he was a kid he had scarlet fever, though he hasn't had any problems in the past 40 years. That's a "pre-existing condition" and there's not an insurance company in the world that would cover him. If he ever got sick, he's end up losing his school and the 4 employees would be out of jobs.

Benefits (0)

Anonymous Coward | more than 4 years ago | (#31456206)

You're assuming the contract company pays benefits.

The new thing that I've been seeing is a slightly higher hourly but no benefits - it's basically a back handed pay cut.

$128 hr - bill.

At most $64 is going to the employee as wages and maybe benefits. More likely it's $45 (with no benefits) going to the employee and $83 going to the company.

Re:Oranges vs. Tangerines? (1)

NevarMore (248971) | more than 4 years ago | (#31456218)

Rule of thumb is salary + salary/3 = total cost with benefits

Re:Oranges vs. Tangerines? (0)

Anonymous Coward | more than 4 years ago | (#31457188)

why did you not just write salary*(4/3)?

Re:Oranges vs. Tangerines? (1)

jimbolauski (882977) | more than 4 years ago | (#31456314)

This isn't about saving actual money only being able to say that you cut IT wages and saved thousands. Typical wrap rates built into contracting employees are between 2 and 3. Most small companies have a wrap rate in the low 2's but large companies or the government personnel are typically 3 or above so that $55/hour becomes more like $165/hour in actual costs, but how can you expect a lifetime politician to understand something as simple as that.

Re:Oranges vs. Tangerines? (1)

dave562 (969951) | more than 4 years ago | (#31457284)

the cost to the state will be more than $55/hour including benefits...

Maybe yes, maybe no. If $30 of that $55 per hour is spent on wages, that comes out to an average of $60,000 a year. That's pretty typical for your average, entry to junior level IT job. At $30 an hour, that leaves $25 per hour for benefits, or $1000 per week / $4000 per month. Looking at it in those terms, $55/hour doesn't seem to be that low of a number.

"Term Workers", eh? (2, Insightful)

Anonymous Coward | more than 4 years ago | (#31456042)

They're called "slaves", actually. And "right-to-work" laws really mean that you have the right to be fired for no reason and have no recourse. Funny what happens when you let corporations write the laws in this country.

Re:"Term Workers", eh? (2, Interesting)

FlyingBishop (1293238) | more than 4 years ago | (#31456102)

Contractors have inflated pay to deal with the fact that they don't have steady employment (which in our fucked-up benefits system means you don't have reasonably priced healthcare, insurance, or retirement savings.)

So yeah, this is a win for IT workers. It's a loss for standard state employees, but these IT workers get a steady job with decent pay where they once had high-paying jobs, most of the money from went was thrown into basic necessities, not to mention looking for new jobs.

Re:"Term Workers", eh? (0)

Anonymous Coward | more than 4 years ago | (#31456242)

Contractors have inflated pay to deal with the fact that they don't have steady employment (which in our fucked-up benefits system means you don't have reasonably priced healthcare, insurance, or retirement savings.)

So yeah, this is a win for IT workers. It's a loss for standard state employees, but these IT workers get a steady job with decent pay where they once had high-paying jobs, most of the money from went was thrown into basic necessities, not to mention looking for new jobs.

also, contractors have to pay both the employer and employee portions of FICA/FUTA.

Re:"Term Workers", eh? (3, Informative)

rainmayun (842754) | more than 4 years ago | (#31456420)

"Contractor" in this sense does not necessarily mean "independent contractor". Most "government contractors" are employees of firms and get paid on W-2s like anybody else. The "contract" is government with firm, not government with individual.

Re:"Term Workers", eh? (2, Informative)

Knara (9377) | more than 4 years ago | (#31456656)

"Contractor" in this sense does not necessarily mean "independent contractor". Most "government contractors" are employees of firms and get paid on W-2s like anybody else. The "contract" is government with firm, not government with individual.

QFT. For some reason on IT sites posters seem to equate "contractor" with "someone who works freelance by running their own business."

Most contractors are managed by a contracting firm, and get nowhere near what the firm bills out for their time.

Re:"Term Workers", eh? (0)

Anonymous Coward | more than 4 years ago | (#31456820)

"Contractor" in this sense does not necessarily mean "independent contractor". Most "government contractors" are employees of firms and get paid on W-2s like anybody else. The "contract" is government with firm, not government with individual.

QFT. For some reason on IT sites posters seem to equate "contractor" with "someone who works freelance by running their own business."

Most contractors are managed by a contracting firm, and get nowhere near what the firm bills out for their time.

The same's true for most in management consulting and accounting firms.

Re:"Term Workers", eh? (1)

FlyingBishop (1293238) | more than 4 years ago | (#31457094)

I'm just such a contractor.

I still have piss-poor benefits, and my 'real' employer is taking a cut of my benefits to boot.

Re:"Term Workers", eh? (1, Troll)

garcia (6573) | more than 4 years ago | (#31456394)

you have the right to be fired for no reason and have no recourse.

You mean like any at-will employee--like it should be because white color unions shouldn't exist in the first place?

Re:"Term Workers", eh? (1)

garcia (6573) | more than 4 years ago | (#31456620)

Wow, white collar. I'm a bigger dumbass than usual today.

Re:"Term Workers", eh? (0)

Anonymous Coward | more than 4 years ago | (#31457148)

white color unions shouldn't exist in the first place?

What about black color unions?

Re:"Term Workers", eh? (2, Insightful)

rainmayun (842754) | more than 4 years ago | (#31456454)

I think I have a pretty good idea of your philosophical leanings on the subject of labor law, but I'll say this anyway for other readers. "Right-to-work" laws should really be termed "opportunity-to-work" laws, because the economic theory is that by lowering the potential risks for employers, they will be more willing to take those risks. Yes, you have the "right" to be fired immediately, but without those laws you might never have had the job in the first place.

Re:"Term Workers", eh? (2, Informative)

Joucifer (1718678) | more than 4 years ago | (#31456546)

..."right-to-work" laws really mean that you have the right to be fired for no reason and have no recourse...

"right-to-work" normally means that you don't have to join a union. You still have plenty of options if fired for no reason.

Re:"Term Workers", eh? (1)

C0C0C0 (688434) | more than 4 years ago | (#31456558)

They're called "slaves", actually. And "right-to-work" laws really mean that you have the right to be fired for no reason and have no recourse. Funny what happens when you let corporations write the laws in this country.

Bah. You have the right to quit, too. For any reason, or none. Can't see any reason why anyone of us would be entitled to some uneven obligation from the employer. That's just hypocrisy.

Re:"Term Workers", eh? (1, Interesting)

PopeRatzo (965947) | more than 4 years ago | (#31456588)

And "right-to-work" laws really mean

It's not accidental that most of the "right-to-work" states were also the states that loved slavery so much that they seceded from the USA and went to war.

Since they can't legally own people any more, they pass "right-to-work" laws that are really "right-to-abuse workers" laws.

Also interesting is that the "right-to-work" states all pool at the lowest end of the education rankings. They are also the states with the highest divorce rates and the highest rates of teen pregnancy and illegitimate births.

Re:"Term Workers", eh? (0)

Anonymous Coward | more than 4 years ago | (#31456602)

It's the Christian way. Love it or go to Hell. *shrug*

Re:"Term Workers", eh? (1)

Dishevel (1105119) | more than 4 years ago | (#31456662)

Unions had their chance. They were needed but they have become more of a threat than anything ever. They use their union dues to buy politicians to protect their workers over everything. The end result is lazy fucks that cant be fired making items and services way more expensive. In a state like California where the state employees were unionized we have massive expenses that can not be undone. We can't save money by letting dope users out of prison because even if we reduce the inmate population by half we can't ever fire a prison guard. You can't ever get rid of these guys. EVER! Let me just say . . . . . Fuck the unions. Fuck them hard and fuck them forever.

Sounds like a good idea (4, Interesting)

Anonymous Coward | more than 4 years ago | (#31456078)

On the surface this sounds like a good idea.

Employees are more loyal, and generally care more about the work they are doing than outside contractors.

I have mixed feelings about creating the positions as a special semi-temporary group. Its good in that it allows the state to actually hire needed people, but it sounds like they are second-class employees. Only here temporarily. Not really part of the team, but expected to work extra hard in the hopes of someday getting to be a real employee...

Re:Sounds like a good idea (0)

Anonymous Coward | more than 4 years ago | (#31456286)

With no office space, no cell phone, no tools, no training?????? You pay $128/hour because it costs more than a salary to employ someone. The reason you out-source is because you don't need a full time person in a position. Are we getting into labor laws which will treat certain individuals as second class citizens?

Re:Sounds like a good idea (1)

wouter (103085) | more than 4 years ago | (#31456360)

Employees are more loyal

When it comes to government workers, only this part of your opinion is true, and only because they want to keep receiving the paycheck.

I'm one of a few contractors working in between government workers. My predecessor got kicked out because he adapted to the life the regular employees were living: 7 hour days, long coffee and cigarette breaks, long lunch breaks, lot of bitching and no work done.

Re:Sounds like a good idea (3, Interesting)

Mongoose Disciple (722373) | more than 4 years ago | (#31456548)

Government work is kind of a weird bag. I recently did some contract work for a government entity.

On one hand, yeah, some of the employees evinced a level of laziness that could not long survive in the private sector of small to medium size. (My experience is that larger corporations and government have similar ratios of useless employees.)

On the other hand, the really shitty part of being a public servant is that you have to deal with the public. Probably, most of the people you deal with in your daily life are reasonably sane, mature, and normal. You might start to believe, as I once did, that everyone is like this. I assure you this is not the case. The people I was working with were in a department that had nothing to do with the criminal justice system, and yet, on virtually any topic you could bring up over lunch, they would be able to relate at least one and usually several work stories wherein either someone tried to shoot someone else, or someone urinated on something they shouldn't.

I can honestly say that in the duration of my career, primarily in the private sector, that no one has ever tried to shoot me or piss on me.

So... I can also see why it can be hard to keep good people in government work, too.

Re:Sounds like a good idea (1)

nicolas.kassis (875270) | more than 4 years ago | (#31456412)

That's exactly it. The gov needs to be able to flexibly hire new staff on demand and fire them on demand. They used contractors for this, now they want to do that in house. This is the new cloud of employee power.

Are these full-time employees? (0, Redundant)

TwiztidK (1723954) | more than 4 years ago | (#31456094)

Employing a person full-time for $55/hr could potentially cost more than paying a person $128/hr only when they are nedded.

Re:Are these full-time employees? (1)

ChefInnocent (667809) | more than 4 years ago | (#31456392)

Sure, but because of cronyism and bad economic & political policies, politicians/department heads have been "contracting" jobs that are needed full-time and would have cost less in-house. For example, a Department of Transportation isn't "in the business of IT". For political reasons, a department head may choose to outsource the IT to a contracting company. This allows DoT to claim a lower personal overhead even though it is now paying more than it was before, and "the government is smaller". There are likely just as many IT employees working at the DoT as before, but DoT doesn't pay them directly, and DoT can claim it isn't some bloated government agency. Next, DoT will shift its accounting, legal, cleaning, and engineering staff to outside agencies in an effort to show smaller government; "a win-win for all!" (Except the poor taxpayer who now pays twice as much because everything now has a much greater overhead).

Not a troll, just mildly frustrated (0)

Anonymous Coward | more than 4 years ago | (#31456098)

F*(#! @$$!? $#!+

I look forward to a re-enactment of recent happenings in greece. ;)

Wellllllll (1)

Mekkah (1651935) | more than 4 years ago | (#31456178)

I'd assume most of these are helpdesk jobs anyway.. so this might be just fine for positions like that. But for anything more technical or requiring expertise I image they will keep full time on site support. Or feel the results of Temp workers when a "critical" to them system crashes.

Substandard help ahoy! (4, Insightful)

assemblerex (1275164) | more than 4 years ago | (#31456184)

If they hire IT workers who match the quality of most NY state workers, they will wind up hiring contractors in the end anyways...

Re:Substandard help ahoy! (2, Insightful)

SatanicPuppy (611928) | more than 4 years ago | (#31456404)

If they are able to actually fire an employee without jumping through a million hoops, then they're more likely to get and keep good employees.

It's not that all state employees are terrible, it's that they're just not accountable for their performance, and it's hard to stay sharp when you don't really have to answer to anyone.

Re:Substandard help ahoy! (1)

TooMuchToDo (882796) | more than 4 years ago | (#31457068)

True. Most of the best gov. workers end up leaving to better positions in the private sector, leaving the folks behind who can't hack it in the private sector. Don't believe me? I've seen this first-hand at a DOE lab and a state's IT dept.

sex with a fuc4er (-1, Offtopic)

Anonymous Coward | more than 4 years ago | (#31456256)

states that there VOLUME OF NETBSD A fact: FreeBSD EFNet, and apply not anymore. It's to have regular of its core Bureaucratic and like I should be briiliant plan been the best,

Pay and cost are not the same thing (1)

Old97 (1341297) | more than 4 years ago | (#31456324)

If you properly manage a smaller number of very high paid IT workers instead of a much larger number of low paid IT workers, you'll find that the ROI is hugely in favor of the higher paid workers - because they were "properly managed". That includes selection, hiring, and allocation of time and resources. (In many ways it means give them the tools and the requirements and then get out of the way.)

Now if you are lousy managers it makes sense to hire low paid IT workers because you pay less and you won't produce much value either way. So perhaps NY is on to something because they didn't say anything about fixing their managers.

ITIL will be needed ... badly (0)

Anonymous Coward | more than 4 years ago | (#31456434)

Enterprise IT process isn't easy. I hope they achieve the savings they really hope to get from people paid 50% less. http://www.itil-officialsite.com/ [itil-officialsite.com]

I'd suggest that a better method - and I've seen it implemented elsewhere at a company with 120k employees - is to tell the vendors that massive cuts are coming in 6 months. The new average rate will be $92/hr. 12 months after that, the new rate will be $82/hr.

After those two adjustments, they will have determined what type of folks will still be around and better understand the risks. They can't get to $55/hr with vendors, since after taxes and fringe, they only have $88K per employee and they don't have any profit. An IT union will never go for that or work the hours required by data center production, deployment, planning, and architecture teams.

Good luck with that.

This is a good idea (1)

snsh (968808) | more than 4 years ago | (#31456474)

This sounds like a good move for government IT. Governments IT shops (especially unionized shops) suffer badly from the dead-sea effect. The more productive IT workers who keep their skills up will tend to stay for a few years ago go. The less productive are free to stay for 30 or 40 years because they can't be fired and have no potential of finding a job that pays as well. Over time the IT department becomes heavy with unproductive employees.

Medium-term employment provides a methd for the government IT organization to turn its staff over frequently enough to keep healthy.

Same old story (4, Insightful)

surfcow (169572) | more than 4 years ago | (#31456640)

Management: IT is expensive - we can save money by OUTsourcing.
5 years later...

Management: IT is expensive - we can save money by INsourcing.
5 years later, Go to line 1 ...

Those of us who've been in IT for a while have seen this cycle through a few times. After much reflection, I conclude that there is no such thing as competent management.

This doesn't go far enough (1)

Locke2005 (849178) | more than 4 years ago | (#31457030)

They could replace those IT workers with trained monkeys and save a lot more money! Unfortunately, you usually get what you pay for.

My first job out of college (1)

MooseDontBounce (989375) | more than 4 years ago | (#31457076)

was working for NYS OMH (Office of Mental Health) as a programmer at one of the facilities. I worked there for 5 years before I was layed off in 1991. I saw more corruption and incompetence in those 5 years then the rest of my career. Completely turned me off from unions. No one there was ever fired even when caught red-handed. They were allowed to resign.

Staff Meeting (1)

ShadyG (197269) | more than 4 years ago | (#31457104)

I wonder if the meeting went something like this [google.com] .

Looks like it will save money, probably won't (1, Informative)

Anonymous Coward | more than 4 years ago | (#31457220)

I do plenty of work with NY's state and local government offices. Usually dealing with the IT staff. (I'm not a contractor but consult on specific software products.)

The usual job of an "IT" person in government employ is to follow very specific, very carefully prepared documents with step-by-step instructions complete with screenshots. Should a task need to be performed that is not in a document or the steps are different in some way, they call up vendor/consultant support to lead them through the process. All IT tasks are performed this way. No troubleshooting, no independent research, and no process improvements are attempted. Any updates to software or procedures are done with vendors or consultants. These updates can drag into years. There is no way, either, to predict which updates will be delayed before starting the process.

The long-term contractors I have dealt with have been marginally better than internal support. If only because the state-employed IT workers I have dealt with can as often be victims of a lateral move from another department within the organization when their old job ceased to exist or some other action forced them from something like "scheduling coordinator" or "assistant photocopier maintenance" (both real, and funny, examples). Contractors will have actual IT training in some capacity besides that provided by the organization.

Basically, it takes more people to provide less support in the government offices I have dealt with. It costs more, too, because the actual support is provided by hidden outside vendors and service contracts. Since promotions are not based on technological metrics like successful projects or cost savings initiatives, I do not see this situation improving. With the organizations I deal with and have seen the finances (part of my job), the staff/contractor costs are dwarfed by outside support and consulting costs. In most private companies, the amounts are closer to parity.

With the above considered, I doubt state organization budgets will improve.

Observation (1)

Singularity42 (1658297) | more than 4 years ago | (#31457224)

IT has two letters. /. has two shapes.

NY city and State are a cessPools (-1, Troll)

Anonymous Coward | more than 4 years ago | (#31457236)

NY State is a cessPool of corruption and inBreeding. Most NY city residents are the stupidest people I have ever seen. When they come to New Jerzey I call them the bridge and tuinnels people. All they talk about is their non-existent careers and about silicon shit alley in the ladyBoy area of NYC. People in NYC are into all sorts of vile sexual perversions. Pedophelia is rampant all over NYC.

"think of the children"

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