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Advice on Contracting
Self | 12 May 2005 | <self>

Posted on 05/12/2005 9:25:28 PM PDT by Lexinom

I would like some advice on my rights as a contractor.

I have been doing contract work based on a verbal contract for the last year for a small company. At the present time, we are completing a project. They have paid me for overtime according to my rate, but have not provided any vacation time. The CEO says they have given me vacation on the basis that one week I was not able to work due to connectivity issues (everyone else was gone) - nonethess I was asked to work, ready to work each day either remotely or on site, and was not able to due to their own network issues. Given the work demanded of me over the last year, I am quite burned out and could really use a break. Instead, I get an earful.

Presently I am on the health plan with a child on the way in the next couple of weeks. This is the main reason for staying. I am not easily replacable - the company is small, and the type of work is not something anybody could jump in and do. Therefore I am not too worried about termination (they would in effect be terminating themselves as the work would not get done for many months it would take to train). Still, if the unprofessional conduct reaches the point where I must leave on my own, could I get Cobra or some other plan that would kick in right away? Baby is due early June.

I would appreciate if you have a similar story to share, and of course any advice...


TOPICS:
KEYWORDS: benefits; contracting; software

1 posted on 05/12/2005 9:25:28 PM PDT by Lexinom
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To: Admin Moderator

AM, could you remove this from "News/Activism"? It was intended for "Chat".


2 posted on 05/12/2005 9:26:17 PM PDT by Lexinom (Seattle is to the unborn what Auschwitz was to the Jews)
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To: Lexinom

Your verbal contract is worth only the paper it is not written on.


3 posted on 05/12/2005 9:27:38 PM PDT by HuntsvilleTxVeteran ("In any compromise between good and evil, it is only evil that can profit." AYN RAND)
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To: Lexinom

Honestly, I don't see where they've screwed you around. Anyway, there's some law that Clinton signed making it illegal for them to fire you for being pregnant or having a baby. I think it's the "family leave act" or something of the sort.


4 posted on 05/12/2005 9:28:49 PM PDT by Jaysun (No matter how hot she is, some man, somewhere, is tired of her sh*t)
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To: Lexinom
First, you get a lawyer..

Let the lawyer work out what you are presently entitled to..

Secondus..
Get a written and signed contract

Rather than concerning yourself with what has been, address the issue as it stands now..

5 posted on 05/12/2005 9:28:53 PM PDT by Drammach (Freedom; not just a job, it's an adventure..)
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To: Lexinom
"verbal contract"

Well, first off.....your "contract" is the problem.....

6 posted on 05/12/2005 9:28:54 PM PDT by goodnesswins (Our military......the world's HEROES!)
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To: Jaysun

It's my wife actually that's expecting the baby!

This company is well-known for burning bridges. That's why they're still small and struggling after two decades. A similar company started at same time has 500 employees.


7 posted on 05/12/2005 9:30:15 PM PDT by Lexinom (Seattle is to the unborn what Auschwitz was to the Jews)
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To: Lexinom
If you are on contract you don't get vacation unless you contract for it.

Same with paid holidays etc.

Regarding your medical insurance issues. Don't change your coverage if at all possible.

However based on the rest of your post, right after you deliver should be a perfect time to extract an extortionistic type raise from the PHBs. They will know just how bad they need you based on the absense.

Remember libertys are taken not given.

8 posted on 05/12/2005 9:30:30 PM PDT by Dinsdale
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To: goodnesswins

I understand Washington RCW does not recognize verbal contracts.


9 posted on 05/12/2005 9:31:02 PM PDT by Lexinom (Seattle is to the unborn what Auschwitz was to the Jews)
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To: Dinsdale
" Remember libertys are taken not given."

Good advice!

10 posted on 05/12/2005 9:32:10 PM PDT by Lexinom (Seattle is to the unborn what Auschwitz was to the Jews)
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To: Lexinom

If you got paid the week of 'connectivity issues' and did not work, then he has a point.

On the general issues - verbal contracts are always dicey. They do hold weight, depending on the state, the terms, etc. I would get something in writing, if nothing less at least get an email indicating the intent and general terms of your employment. However, most companies can terminate at will, and contracts generally only bind them to causes of action and severance packages (Unless you're an NEA teacher).


11 posted on 05/12/2005 9:32:33 PM PDT by BlueNgold (Feed the Tree .....)
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To: Lexinom
It's my wife actually that's expecting the baby! This company is well-known for burning bridges. That's why they're still small and struggling after two decades. A similar company started at same time has 500 employees.

But you said "contract work based on a verbal contract". That leaves the company with almost no obligations, save what they're willing to do out of the goodness of their hearts. Is it necessary that your wife work after having the baby? Is there a way for you to allow her to stay home with the kids?
12 posted on 05/12/2005 9:33:22 PM PDT by Jaysun (No matter how hot she is, some man, somewhere, is tired of her sh*t)
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To: Lexinom
Look, you are a 'contractor', NOT an employee. You do not have any right to a vacation.

Think of it this way. You hire someone to build a deck on your house. Do you owe them vacation time halfway thru the job? How about if you hire a plumber. Do you owe him a paid lunch hour? An auto mechanic. Do you owe him a dental plan for putting in a transmission in your car?

NO. A contractor is hired for a specific job (or series of jobs). A contractor is like the kid you hire to mow your lawn for $20.00. He owes you a mowed lawn and you owe him $20.00. That's it! If you give him some lemonade, that's great, but you only owe him what you specifically promise him and no more.

I have worked as a contractor and I have hired contractors in the past. Lots of times it feels like and employer/employee relationship, but it is NOT.

13 posted on 05/12/2005 9:34:01 PM PDT by keithtoo (Howard Dean's Democratic Party: Traitors, Haters, and Vacillators)
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To: Lexinom
O.K., Before you actually agree to the contract, make sure the person offering the contract is not a cop. Check for recording devices and make sure there's no one close enough to use a parabolic microphone.

Next, once you have taken the contract, make certain you are given recent photographs of the target and if possible an ACCURATE address. I can not stress this enough!

Finally, Take time to OBSERVE the target. Learn his habits, his routines, paths to and from work, etc.

Oh and before you commit to filling the contract, always get at least 40 percent up front.

Good luck.
14 posted on 05/12/2005 9:35:24 PM PDT by Dr.Zoidberg (This tagline brought to you by Islam. Islam, only the best of the 12th century for you and yours.)
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To: Jaysun

That's good to know, actually. I've been the kind of person that likes to make everyone happy and keep the red-tape to a minimum, but that has been abused in this case. I feel grateful to be on the health plan and to have this work to do, but also feel used. If I'm going to put in the kind of effort they demand, I'll go over to Micro$oft and at least get some reward for it.

My wife is a full-time housewife by mutual choice. She will also homeschool when the time comes.


15 posted on 05/12/2005 9:44:31 PM PDT by Lexinom (Seattle is to the unborn what Auschwitz was to the Jews)
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To: Dr.Zoidberg

LOL :-D


16 posted on 05/12/2005 9:45:57 PM PDT by Lexinom (Seattle is to the unborn what Auschwitz was to the Jews)
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To: keithtoo
I filled my original contract long ago, but was kept on.

From what you've said, sounds like it's bye-bye time.

17 posted on 05/12/2005 9:47:01 PM PDT by Lexinom (Seattle is to the unborn what Auschwitz was to the Jews)
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To: BlueNgold

No. I billed for one hour that week - the time I spent in the office trying to make things work after the long drive down. I do not - nor expect to - get paid for time not worked.


18 posted on 05/12/2005 9:48:49 PM PDT by Lexinom (Seattle is to the unborn what Auschwitz was to the Jews)
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To: Lexinom
If you are in software and are on a verbal contract you may own the code you generated for them.

Check in your state but the default in some states is that you own the code, they own a license.

On the other hand you might not want to own the code...unless their competitors would also like to buy a license. But that is burning a bridge so it's a drastic step.

19 posted on 05/12/2005 9:51:36 PM PDT by Dinsdale
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To: Dinsdale
The code has been extremely rushed. This company does not write design specs becase of the time it takes. Ironic because the resulting bugs and maintainability more than nullify the time savings.

The CEO does not even have a high-school diploma, from what I understand.

20 posted on 05/12/2005 9:53:56 PM PDT by Lexinom (Seattle is to the unborn what Auschwitz was to the Jews)
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To: Lexinom
Still, if the unprofessional conduct reaches the point where I must leave on my own

I've been a self-employed computer consultant since 1995 and I will give you my advice, even though you may not want to hear it (please do not take this as an attack on you, I am just speaking matter-of-factly).

First, a "verbal" contract means very little. Yes, you could probably get a lawyer that might be able to "infer" a contract based on your length of employment. However, the will be no inferral of vacation or sick days. You REALLY need to get a written contract, and have it reviewed by a lawyer (pretty inexpensive).

Second, you are a CONTRACTOR and not an EMPLOYEE. Therefore, you must forget about paid vacation, paid sick leave, Martin Luther King holiday, etc. The employer owes you absolutely none of this. This is why you hopefully charge a little higher in order to take your own vacation each year and be able to afford it (since you won't be getting paid during that time).

Third, you made the statement: "I am not easily replacable - the company is small, and the type of work is not something anybody could jump in and do. Therefore I am not too worried about termination (they would in effect be terminating themselves as the work would not get done for many months it would take to train)."

You are by no means irreplaceable. Please understand that. I'm sure that you provide a great service and do great work, but that same job could be getting done (on a quality basis) next week given the appropriate amount of money spent by your employer.

Fifth, you made the comment: "Still, if the unprofessional conduct reaches the point where I must leave on my own..."

Absolutely nothing in your post corresponds to "unprofessional" conduct by your employer. It sounds like they are treating you as a CONTRACTOR.

In summation: you really need a written contract and you must stop thinking of yourself as an employee of the company. You're not.

I hope that you consider this post in the light that it was written. This is not meant to demean you since MANY contractors go through the exact same thing once they have been with a company for a while (i.e.: thinking that they should be invited to the office Christmas party).
21 posted on 05/12/2005 9:58:47 PM PDT by politicket (We now live in a society where "tolerance" is celebrated at the expense of moral correctness.)
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To: Lexinom
Dude I've been there.

You have got them by the short and curlys.

Raise your billing rates, then raise them again. Repeat untill they claim your taking food from their children. Then repeat again.

They have chosen to (buy their business methods) to deal you four aces. You are a fool if you don't extract every dime from them. I do mean every dime, think of it as a race between them going bankrupt and them getting a clue. It's an immoral act to let a sucker keep his money. By definition he is a sucker therefor was 'lucky to get together with his money in the first place'. Also by definition no one is more deserving of the money then you (aside from me of course). Therefor it is an immoral act to let a sucker keep his money, someone less deserving will get it.

On second thought they have delt you three aces, you need to find the forth ace yourself (that is another offer).

22 posted on 05/12/2005 10:01:15 PM PDT by Dinsdale
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To: politicket
Sorry for the typos in my post above....my computer programming is actually better than that...I'm series! ;-)

Point #4 was unimportant anyways...
23 posted on 05/12/2005 10:01:45 PM PDT by politicket (We now live in a society where "tolerance" is celebrated at the expense of moral correctness.)
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To: politicket
Thanks for the advice. I've bookmarked this and will refer back to it. It is much appreciated.

I am sorry to have left the impression I expect paid vacation. No, I don't expect to be paid for hours I don't work. Burnout is simply a reality common to our industry, as you are probably well aware.

24 posted on 05/12/2005 10:01:54 PM PDT by Lexinom (Seattle is to the unborn what Auschwitz was to the Jews)
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To: Dinsdale
Wow. This is exactly what a buddy of mine says. He is also an ex-contractor for this firm - one of the few that doesn't hate them.

Working on that fourth ace ;-)

25 posted on 05/12/2005 10:05:40 PM PDT by Lexinom (Seattle is to the unborn what Auschwitz was to the Jews)
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To: Dinsdale; Lexinom
Raise your billing rates, then raise them again. Repeat untill they claim your taking food from their children. Then repeat again.

If you take Dinsdale's advice then you will have LOTS of time to spend with your new baby at home, and good luck on referrals for a new contract.

If you knew how many contracts I have been able to take over because a contractor thought they had a company by the "short and curlys" then you would be amazed. That's how I have made part of my living. Remember, NOBODY is irreplaceable.
26 posted on 05/12/2005 10:05:56 PM PDT by politicket (We now live in a society where "tolerance" is celebrated at the expense of moral correctness.)
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To: politicket
I've got to jump in and disagree with one point you made.

Given poor enough methods there is no way a person can be replaced in a week. Even in good environments new people are net negative for a period depending on the project complexity.

If he's up to his nose in the project and the company depends on the system for core business he can leave the CEO thinking the word extortion 10 years from now when his name is mentioned. I've done the very thing. It feels good to deal out some justice once in a while.

27 posted on 05/12/2005 10:08:04 PM PDT by Dinsdale
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To: politicket; Dinsdale

I'll raise them a little bit, as my rate is a little low for my experience level anyways, and I deserve a raise after over a year. Besides I'm not enjoying being there, being burned out and all. I could get more at Micro$oft.


28 posted on 05/12/2005 10:09:21 PM PDT by Lexinom (Seattle is to the unborn what Auschwitz was to the Jews)
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To: Lexinom

I've been an independent contractor (technical writing and course development) for over 10 years, and have to agree with Politicket.

(Also, in your duplicate thread, you mention that you took pity on the company. Don't let emotions ever get in the way of your best interests. You can't save a mismanaged company all by yourself.)

IRS guidelines on determing independent contractor vs. employee, with links to additional info, including detailed IRS training manual:

http://www.irs.gov/businesses/small/article/0,,id=99921,00.html


29 posted on 05/12/2005 10:10:35 PM PDT by LibFreeOrDie (L'chaim!)
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To: Lexinom
I'm glad that you took my comments in the context that they were meant.

I work an 80-hour week in my personal company taking care of my clients (fortunately a large number of those hours are from my home office).

Computer burnout can be intense, especially when the wife gets jealous that you spend more time with the computer than with her. I would recommend sitting down with your wife and setting up a budget and goals. The goals should be for 1 Year, 5 Years, and 20 Years. This will help to establish a vision and put you back in control of your career.

Also, if you don't absolutely love to program then you might need to reassess what career to would love to do.

Lastly, be thankful to God. It sounds like your current client helped you avoid the massive layoffs that a great number of people in our industry experienced. I know many folks that were out of work for well over a year - some two years.
30 posted on 05/12/2005 10:12:16 PM PDT by politicket (We now live in a society where "tolerance" is celebrated at the expense of moral correctness.)
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To: politicket
I have heard so many stories of the CEO yelling and cussing people out. My time just about came on Wednesday, but I averted it by remaining cool. Still, I saw the ugly wolf snarling under the lambskin, and it used foul language.

Programming is my main skill, and I've been at it since age 9. The only other thing I could do would be to invent a new computer, but that's for the future... All I need right now is a break and I'll be fine...

Yes you are right about thankfulness. Ironically, this company contacted me just a week after I had been laid off from another position. I had worked with them before, and heard from them out of the blue. I was one of the few remaining unburned bridges (see above comments about the CEO's temper). The Lord does only good.

Thanks for your forthright and kind words.

31 posted on 05/12/2005 10:19:34 PM PDT by Lexinom (Seattle is to the unborn what Auschwitz was to the Jews)
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To: Lexinom; politicket
It is a dance. If your not core business you have to limit your expectations.

However recognizing when you truly have them by the short and curlys is an important skill.

Noone is irreplaceable. But your replacment cost could be MUCH higher then your current billing rate. It could be shutting down their business for a period. If that is the case you should extort.

If this is your first contract position or you NEED the ref. Don't do it. My advice was based on the assumption that you have a reputation established and don't much care about the final outcome for a company as poorly managed as the one you discribe (which begs the question why have you stayed as long as you have?).

Remember you will get most of your future contracts through contacts with other technical people. The people you want to impress are the others in the trenches as they will scatter to the four courners of the world. Do a good job, don't make the jobs of others harder then needed. Managers often don't understand what you do, much less if you do it well.

32 posted on 05/12/2005 10:22:33 PM PDT by Dinsdale
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To: Dinsdale
Given poor enough methods there is no way a person can be replaced in a week. Even in good environments new people are net negative for a period depending on the project complexity.

Not to argue, but I my company specializes in cases exactly like this. I can go into a company, especially a small one like this, and have their entire business process mapped in three days. I can have a full infrastructure analysis done one week later.

Any written code can be worked through and corrected (by a fast-response team if necessary).

Again, programmers need to stop thinking that they are irreplaceable.
33 posted on 05/12/2005 10:27:01 PM PDT by politicket (We now live in a society where "tolerance" is celebrated at the expense of moral correctness.)
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To: Dinsdale
Given poor enough methods there is no way a person can be replaced in a week. Even in good environments new people are net negative for a period depending on the project complexity.

Please let me know your current client. I have a business proposition for them... ;-)
34 posted on 05/12/2005 10:29:38 PM PDT by politicket (We now live in a society where "tolerance" is celebrated at the expense of moral correctness.)
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To: Lexinom
I have heard so many stories of the CEO yelling and cussing people out. My time just about came on Wednesday, but I averted it by remaining cool.

You handled it well. My best advice to you is to stay OUT of office politics, lest you be swept in by the undercurrents and drowned. Stay above the fray...

If you have been with the company for a year then it is probably a good time to discuss a small increase in your rate with them.
35 posted on 05/12/2005 10:32:27 PM PDT by politicket (We now live in a society where "tolerance" is celebrated at the expense of moral correctness.)
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To: politicket
Working for clients with such poor methods was a thing of my twentys.

Today I think life is too short for full time work, and see the rates my bosses saw as extortion then as so so.

I've gotten financially positioned to be able to say no. It prevents me from doing crazy things like working (many) 80 hour weeks. Seriously I bet you could say no to some of the crazy hours but could'nt say why beyond the money you never have time to spend (at some point money just becomes a way of keeping score IMHO). Please take this all as friendly commentary etc. Tell me to shut up if you need 500K/year for a sick kid or something.

My pattern seems to be about a 50% duty cycle with about 50 hour weeks if clusters of months (I find my quality drops drastically if I don't get enough sleep). I do remember being hungry, but I also remember working my a&* off when I could'nt find sensible ways to spend the money I already had.

I'll post my client list right after you post yours. And yes I'm gratefull for so many things.

36 posted on 05/12/2005 10:48:41 PM PDT by Dinsdale
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To: Dinsdale
I've gotten financially positioned to be able to say no. It prevents me from doing crazy things like working (many) 80 hour weeks.

I could cut my hours down by taking on a few more quality sub-contractors.

30 hours of my week are not paid per se. They are being used to expand my business from being only service-based to one which is also product-based.

I'm beginning to move away from the "dollars per hour worked" scenario into the "dollars per product sold". That way my efforts can be multiplied many times over.

I'm also fortunate that almost all of my hours are home-based, so I am able to enjoy my family and get work done at the same time.
37 posted on 05/12/2005 10:55:27 PM PDT by politicket (We now live in a society where "tolerance" is celebrated at the expense of moral correctness.)
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To: politicket
I'll probably end up sticking it out. CEO notwithstanding, I have good relationships with everyone else on the team and do have a concern for their welfare.

But then Micro$oft could be tempting...

38 posted on 05/12/2005 11:11:07 PM PDT by Lexinom (Seattle is to the unborn what Auschwitz was to the Jews)
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To: Lexinom
This sounds like a fine line between "contractor" and "employee." The IRS has several questions you can answer to determine the status of a worker. I'd say you are an employee, not a contractor and the only reason they call you a contractor is so they don't have to carry workers comp insurance on you and pay half your social security.

As a contractor you probably should not be eligible to participate in their employer health care program either. For you to have signed up for that, somebody had to state you are an employee. Since they've already represented you as an employee, if you leave I'd feel sure they wouldn't come clean with their insurance company and say they lied the last three years just to keep you from getting COBRA. That's the only way you would become ineligible.

Won't go into the written contract issue since some other folks covered that on this thread already. But if you continue doing contract work in the future make sure you HAVE a contract that covers what-ifs and allows you a life!

Good luck!! :-)

39 posted on 05/12/2005 11:29:05 PM PDT by PistolPaknMama (Will work for cool tag line.)
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To: Lexinom
But then Micro$oft could be tempting...

Then you will be REALLY burned out. They work you to death over there if you are an employee.

Remembers back when Windows 2000 came to market? Microsoft ran a promotion for three weeks where they gave away free copies of Windows 2000 Professional to lucky winners each week.

Microsoft initially subcontracted the work of setting up that promotion to a company in Utah (U.S. Web). That company took the work but had NO IDEA how to make it happen since they had to use their own web and database servers and make it look seamless to folks surfing Microsoft's site and clicking on the promotion.

This company turned around and subcontracted the work to another company in Colorado Springs, CO by the name of Saligent Software. They grabbed the contract, but also had NO IDEA how to make it happen. Now time was running short.

Saligent Software contacted my company and I agreed to do the work. I had to order high-end servers, software, high-speed rack space, etc., and set up the entire infrastructure in Denver to seamlessly integrate with Microsoft's web page. All of the web content had to flow through the various levels at Microsoft to make sure that that it met their specs.

Then I had to program all of the ASP and database software to capture all of the data so that the marketing folks at Microsoft could run all of their business analysis on it.

This system was up and running in 3 weeks, from the initial hardware order to a finished product hooked into Microsoft's network. The promotion ran flawlessly and my servers got hammered. Microsoft generates a TON of web traffic.

I also had to write the code that picked the winners each week and e-blasted the losers to thank them for entering. When everything was done I gave Microsoft's Marketing department a copy of the SQL Server database and they didn't have a clue what to do with it. I had to move everything over to an Access database so that they knew how to use it.
40 posted on 05/12/2005 11:32:55 PM PDT by politicket (We now live in a society where "tolerance" is celebrated at the expense of moral correctness.)
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To: PistolPaknMama; Lexinom
As a contractor you probably should not be eligible to participate in their employer health care program either.

That is an excellent point! Are you currently getting health coverage through this company? Or is a job shop providing it for you?

If the company that you are going to each day is providing health coverage then I would be VERY careful since the IRS will indeed regard you as an employee. Things can get very twisted from all sides when this happens.
41 posted on 05/12/2005 11:35:58 PM PDT by politicket (We now live in a society where "tolerance" is celebrated at the expense of moral correctness.)
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To: politicket
This company sought me out this time around, not vice-versa, so there's no job shop involved. The health care is on a friendly trust basis, and because I asked for it when my wife found a lump in her breast (which was not serious as it turned out).

I don't want to screw them over - I have friends there - just want to be able to take care of my own needs. Hopefully I will get the time off when the wife has the baby. Technically, I could take the time now and all they could do would be to try to replace me, but I won't do that to them, not so close to an already-late release.

42 posted on 05/12/2005 11:54:08 PM PDT by Lexinom (Seattle is to the unborn what Auschwitz was to the Jews)
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To: Lexinom
I'm glad that everything worked out health-wise for your wife.

I'm just pointing out that the IRS could come after YOU as well as the company since you are working as an employee according to IRS rules. I would sincerely suggest somehow getting the relationship with this company straightened around, since an IRS audit is a major hassle and could be financially detrimental to both the company AND you.
43 posted on 05/13/2005 12:03:22 AM PDT by politicket (We now live in a society where "tolerance" is celebrated at the expense of moral correctness.)
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To: politicket
I doubt it. We're paying them thousands of dollars each month for the privilege of working.

I've got enough worries and don't need to borrow any more trouble. Worrying never solves anything.

44 posted on 05/14/2005 2:10:01 PM PDT by Lexinom (What Auschwitz was to the Jews Seattle is to the unborn)
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