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How European Startups Are Battling Labor Laws For Developers and Programmers 293

Posted by Soulskill
from the sword-perhaps-mightier-than-pen-in-this-fight dept.
Nerval's Lobster writes "The United States with its H-1B controversy isn't the only country going through that sort of immigration upheaval. As the cult of entrepreneurship spirals upward in Europe, the intricate vagaries of immigration policy on the continent are being newly scrutinized by our company-building classes. Freshly venture-backed European Internet companies want talent, and they are going to remarkable lengths to get it — but not always legally. Milo Yiannopoulos talked to whole bunch of entrepreneurs and investors in Europe about the fudges, shortcuts, workarounds and, in some cases, 'strategic decision-making' are — just about — getting their companies the talent they need. For example, one well-known Parisian venture capitalist told Milo that he knows of 'at least nine' startups in France employing developers illegally, keeping them off the books not only to avoid France's notoriously onerous labor laws but also because it would have been impossible, or simply too expensive, to import them officially."
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How European Startups Are Battling Labor Laws For Developers and Programmers

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  • by Chirs (87576) on Wednesday May 15, 2013 @04:59PM (#43735127)

    If the laws of the land are too onerous, the correct solutions are either to change the laws or else go somewhere else.

    • by cayenne8 (626475) on Wednesday May 15, 2013 @05:07PM (#43735215) Homepage Journal

      If the laws of the land are too onerous, the correct solutions are either to change the laws or else go somewhere else.

      That's what most companies do.

      Why doesn't the US set corporate tax to near "0"....for all companies set up physically IN the US with over X number of employees in the states? I'd think we'd be attracting all sorts of businees to our shores. The lack of corp tax would offset to a great deal the higher salaries to be paid here.

      Also, make those non-tax incentives to have to hire US citizens....

      • by gnoshi (314933) on Wednesday May 15, 2013 @05:13PM (#43735273)

        1. Because it is a race to the bottom: if you're getting companies in there because of your 'near zero' corporate tax, don't be surprised if they move to another country with 'nearer zero' corporate tax, and lower payroll tax as well, and maybe poorer working conditions.
        2. Because if a company isn't paying corporate tax, then it is much harder for it to be worth having them in the country (the cost of servicing their existence may exceed their return to society/government)

        • 2. Because if a company isn't paying corporate tax, then it is much harder for it to be worth having them in the country (the cost of servicing their existence may exceed their return to society/government)

          I got news for you: Most corporations pay little if any corporate income tax. Big corporations avoid most income tax by funneling their profits through overseas subsidiaries. Small corporations avoid income tax by electing S corp status. A good tax collects revenue efficiently while having few deleterious consequences. Corporate income taxes are the opposite: they collect almost no revenue while inhibiting the creation of jobs. But corporations still pay plenty of payroll taxes, excise taxes, sales t

          • by gnoshi (314933)

            Yep, many corporations do ay little or no corporate tax. In some countries they then wind up the targets of investigation and receive tax bills and fines.
            I don't think your comment supports dropping the corporate tax rate to zero, but rather better policing and tax law management.

            I've seen the claim that corporate income taxes inhibit job creation, but I've not seen convincing evidence that it does. I've also not seen convincing evidence that it doesn't, mind you.

            • In some countries they then wind up the targets of investigation and receive tax bills and fines.

              ... and other corporations notice that, and locate their new facilities someplace more welcoming.

              I don't think your comment supports dropping the corporate tax rate to zero, but rather better policing and tax law management.

              Every dollar the government spends on better policing and better tax law management is one dollar less for something else. Likewise with every dollar that corporations spend on tax avoidance. US corporations already spend about $200 billion per year on tax avoidance. If the corporate income tax was cut to zero, all of that money could go into something productive, and the end result would be higher overall ta

      • by mlts (1038732) *

        Even better, move to a VAT system... far harder to hide physical objects than money trails.

        • by gnoshi (314933)

          The problem with a VAT system is that it is a flat tax, which means all individuals are taxes equally on what they buy irrespective of income. Some have argued that this is fine, since higher-income individuals consume more and thus pay higher taxes. In practice, though, this is not what happens - the proportion of income which is saved or stashed increases with income. Someone on $20k a year will be spending essentially all their income; someone on $200k a year is much less likely to be. It is the same rea

          • by xelah (176252)

            The problem with a VAT system is that it is a flat tax, which means all individuals are taxes equally on what they buy irrespective of income.

            The structure of corporate taxes isn't better in this regard, and is often worse. The poor pensioner with a few stocks gets her dividends with corporate taxes taken off (assuming they're actually paid in the first place...), and so does the wealthy investor. In the UK at least, owners of businesses are likely to pay less tax than typical employees overall because they can manipulate the structure much more than an employee can. In the UK that might mean receiving their income as dividends, which have a lowe

      • Could you say again what you want? I am not following you.

        For context, most of the world uses a “source” standard of income. If you earned X dollars in country Y you pay Country Y’s tax on those X dollars. America (and a few other small countries) uses a domicile test – If you are a American corporation you will pay American taxes on that income no matter where it was earned. (This at times has led to a tax rate over 100% - so America put in a lot of fudges, exemptions, etc. which ma

    • by gl4ss (559668) on Wednesday May 15, 2013 @05:16PM (#43735297) Homepage Journal

      If the laws of the land are too onerous, the correct solutions are either to change the laws or else go somewhere else.

      Maybe they can't move to the other place to work legally either, Setting up a legal entity in China can be an adventure of it's own.
      But it's not really that hard to employ people legally in europe, even if they're from India or China. Hell, it's easier to get the travel permits if you employ them legally.

      HOWEVER.. if you don't employ them officially you can screw them. Also you save a ton of money in taxes. That's what "uuu it's too expeeensive!!!" and bitching about the labor laws is about.

      actually, they can _screw_ the owners. technically it's the employers fault and they could ask for all the benefits, unpaid holidays etc if the company folds and the owners/employer would be on the hook for them(it's not the illegal immigrant who arranged the situation so technically I think it's just, it's also practical. that's why people employing illegal immigrants generally don't want them to mingle with general population because they would tell all kinds of things about rights and how their illegally acting employer is potentially in deep shit because dodging taxes is serious business)... really, what the fuck is a thousand bucks on paperwork to get some guy that's going to cost you 6-10 thousand euros (legally paid ok pay) per month anyhow, are you going to make your talent live in illegal 10 persons per apartment shithole in some Parisian suburbs? are yo looking for coders or pizza delivery boys?? If your business needs them to work for pennies and you can't afford the taxes, make them partners or something - don't be a dick, it's going to cost you a ton if you are.

      In other words, it's not really a problem in Europe to get the permits, it's relatively cheap as well.

  • Oooops, can't do that...
  • Buy American? (Score:3, Insightful)

    by girlintraining (1395911) on Wednesday May 15, 2013 @05:01PM (#43735139)

    Hey. I'm an American. Our H1-B visa program has tanked our industry. Substandard code, slipping release schedules, low wages. There is plenty of domestic talent here already, and I'm not even here on a visitor's pass.

    What would it take for me to get out of my mismanaged and failed country of fools and into your country, which appears to be slightly less mismanaged and the changes are being pushed by startups who want to pay me well instead of MegaCorp(tm) who wants to pay me minimum wage to do something that takes 10 years of training to get into?

    I'm deadly serious here. I could line up about 50,000 americans inside a week for you guys -- we're unemployed but we have the skillset. Our H1-B Visa program has killed our tech sector. Don't fall for the same trap we did.

    • Re:Buy American? (Score:5, Insightful)

      by DaHat (247651) on Wednesday May 15, 2013 @05:17PM (#43735313) Homepage

      Substandard code, slipping release schedules

      That sounds more like a management issue than it does an H1-B problem.

      If someone is churning out substandard code and causing schedules to slip... be they an American or H1-B holder... replace them... it's that simple.

      • Re:Buy American? (Score:5, Informative)

        by tnk1 (899206) on Wednesday May 15, 2013 @05:38PM (#43735457)

        Speaking as someone who hires and fires people, firing people and hiring new ones is far easier said than done, even if you propose to pay them well.

        Even with a labor market full of candidates with the skills you need, you're still looking at a few weeks to get them in the door. In the meantime, your project is disrupted. Sure, you can try and train up someone on your team and make them work harder for a month or so, but they don't just learn stuff overnight, and your good team member is going to be overworked because those people still have to get their own code/project out the door on time as well.

        I don't know where you have worked, but it's about ten times more likely to see people laid off than it is for them to be fired for performance, and there is a reason for that. I'm not afraid to fire someone who is not performing, but that's usually after at least working with them for some period of time to try and rectify the issues. The last thing I want to have to do is fire anyone unless they are richly deserving and that usually is demonstrated by a history of failure over time. So, if I have a "problem", he's going to be my problem for awhile. Thankfully, if you do find the right candidates, the failures are few and far between.

        I work in a "right to work" state in the US. So, I don't even have to worry about half the stuff a European employer will have to when it comes to letting people go. There is nothing simple about it.

        And there's the fact that you're going to fire someone. Unless the guy is an asshole, even doing what you must for good reason is not a pleasant task. In no way do I want to work for people who think I am going to fire people at the drop of a hat.

        • The last thing I want to have to do is fire anyone unless they are richly deserving and that usually is demonstrated by a history of failure over time. So, if I have a "problem", he's going to be my problem for awhile. Thankfully, if you do find the right candidates, the failures are few and far between.

          I can't say I speak for everyone, but I know I speak for the most professional amongst us when I say: Thank you. I'll never work for you, but we need more managers like you in the field. People who are willing to roll their sleeves up and get involved. So again, thanks.

          We now return to our regularly scheduled flame-fest, already in progress...

        • > I work in a "right to work" state in the US. So, I don't even have to worry about half the stuff a European employer will have to when it comes to letting people go.

          Being in a "right to work state" doesn't change what you have to do to hire or fire someone. It just means that employers are forbidden from entering into exclusive labor contracts with organizations like unions. [wikipedia.org] If the employee is a union member (which can be the case even in right to work states) then you have to abide by whatever con

      • Re:Buy American? (Score:5, Informative)

        by girlintraining (1395911) on Wednesday May 15, 2013 @05:46PM (#43735555)

        If someone is churning out substandard code and causing schedules to slip... be they an American or H1-B holder... replace them... it's that simple.

        You haven't worked with people who ask you to... do the needful... have you? The substandard code is a byproduct of a combination of culture, language barrier, and a lack of experience. Note that I said experience, not education. American labor often stresses that people take their own initiative in solving a problem. You're expected to come up with a solution on your own, with little oversight or guidance, and you're given some leeway in making that happen. Yes, some companies are worse about this than others -- I am speaking in generalities here. YMMV. The culture of many of our immigrants is to not take that initiative -- but to only do things under the express guidance of their leaders. They see a problem and unless it's in the three ring binder that says "Things Management Says You Should Do When You Spot Problem X", it doesn't exist. They don't even see it. If you ask them about it, they'll say they don't know.

        I'd snark you back and say "it's that simple," but nothing about conflicting cultural ideas and attitudes is. Nothing. You can't just replace people who have good attitudes but limited experience or have been trained to not take the initiative... you're just passing the buck on to the next person then. And it won't save your project. Software development isn't like factory work -- you can't mongolian hoarde the problem and solve it faster. In truth, a lot of times adding new people or more people makes the project take longer. This is a "people" problem, but it's commonly seen in all engineering disciplines. It's just the nature of the work.

        The H1-B problem is not about putting down immigrants. We want them. Hell, we need them for some industries. The problem is that you can't destabilize an industry by radically changing either supply, or demand, and not have it hurt everyone. The H1-B program radically increased supply, and as a result, the cost of technical labor dropped -- a lot. It dropped so much that a lot of people who had invested in an education in it were left high and dry, and many people who had solid experience suddenly found themselves knocked several notches down on their career path and had to scramble to find a way to support their current lifestyle at a much lower income, with often tragic results. So a lot of experienced people left the industry to move into fields that were more stable, and the overall quality of the labor dropped.

        This, in turn, fueled more cries for H1-Bs because high level positions were now going unfulfilled -- there was a glut of low-level workers, and very few experienced people because they didn't want to move 'down' in their career and simply moved out. That gap simply couldn't be filled no matter how many workers you threw at the problem. So the entire problem became cyclical... more H1-Bs mean more experienced workers leave, which mean lower overall quality of work, and now businesses are scrambling to find anyone who's qualified amongst a veritable sea of resumes... none which have the amount of experience needed.

        And that, right there, is how our industry collapsed. It was because of short-term thinking -- they wanted to tap into the global labor market, so they poked a hole in the dam of regulations holding them back, thinking they could suckle off the new supply of cheap labor. But they were trying to drink out of a firehose, and then the dam exploded and washed out the entire industry.

        There is no new tech now in this country. It's all gone to shit. It died because of short-term thinking, and now our high tech industry is just an empty shell, unable to produce any better than the third world, because that's the only labor source we have left.

        • by TheSync (5291)

          There is no new tech now in this country.

          Instagram? GoPro? iPhone? iPad? Square? Google self-driving cars? Tesla? SpaceX? Drones from General Atomics Aeronautical Systems & Northrop Grumman?

        • but I've worked with plenty of H1-Bs that had plenty of initiative. The substandard code is a byproduct of working them just a bit too hard. They're actually quiet competent, often better than their American Equivalents. But not always, because in the end they're just people. Culture isn't much of a factor. It's wishful thinking and really just more "American Exceptionalism" to think less of these people. I catch myself doing it, hoping against hope that I'm not replaceable :(...

          Also never forget that so
        • Re:Buy American? (Score:5, Insightful)

          by Xest (935314) on Thursday May 16, 2013 @06:02AM (#43739053)

          Look, I get it, you're unemployed, you're bitter, and you're looking for blame, but you've been going on like this for weeks now and it's tiresome.

          I'll admit I'm not American, and I don't know the vagaries of the H1-B system, maybe that means I don't know what I'm on about, but maybe alternatively it allows me to be objective.

          You see here's the thing, I hear a lot whining about how H1-B has decimated the US technical industry, and the people I hear it from all seem to have one thing in common - they're unemployed or they seem to believe they're underpaid, and it's all the fault of immigrants. So I decided I'd look at the fact.

          I figured I'd see exactly what these low paid immigrant workers are getting paid and so forth, and I found this site which seems to have a pretty good database:

          http://www.h1bwage.com/ [h1bwage.com]

          For 2012 a search of programmer came up with 10k records, developer another 10k, whether any of these crossover I'm not sure, but hey let's call it 20k anyway. Estimates are shaky but currently the amount of developers in the US seems to be anything from about 1 million to 4 million depending on who you ask, but again let's given the benefit of the doubt and pretend there are only 1 million, so H1-B visas account for 2% of developer jobs each year based on these figures, that's a small amount but it's certainly not negligible so it's a fair criticism that H1-B immigrants are taking at least a non-negligible amount of jobs each year. Note that the number of developers has grown each year, and so has the visa cap, roughly linearly so the figure will be reasonable for past years also.

          But I also found figures for average salaries for developers, they seem to have remained fairly stagnant for a few years (if the economy isn't growing much, neither will wages grow much) at roughly $73k per year as the average and the top 10% earning an average of $110k. So the next issue is that immigrants are being employed because they accept less money and are bringing salaries down, again though looking at http://www.h1bwage.com/ [h1bwage.com] I can't really see how that's true - the majority are getting paid more than the average so if anything H1-B immigrants must be raising the average.

          In fact, many of the companies that I see chided here for wanting to increase the H1-B quota "to bring down developer wages" are doing quite the opposite. Facebook in 2012 was paying an average of $115k per developer, Google $125k, Microsoft $104k, Apple $119k. Given this, all these major companies are paying well above the average developer salary to immigrants, and all except Microsoft are paying above the average paid to the top 10% of developer salaries in the US.

          So here's what frankly I think the facts say the reality of the situation is, that in practice, across the globe it's not ever going to be the case that every American programmer is better than every other programmer in the world, in fact, there will be a sizeable segment where the opposite is true, that is for example, that perhaps the bottom 50% of American programmers are statistically going to be nowhere near as talented as the top 10% of developers in almost every other country in the world. That's bound to be a lot of developers, and awful lot. What this means is that technology companies who want to populate their company with the best talent available no matter where in the world that comes from are going to have to use the H1-B visa program.

          I'm not saying there aren't companies taking the piss, one company at least stood out on my peruse through and that was Wipro, they clearly seem to pay a little below average on average, and lot in some cases whilst also taking up more than their fair share of the quota, but by and large the H1-B visa program seems to be being used for what it's intended to be used for, on average does not appear to decrease average developer salaries but in fact increases them and that companies such as Facebook, Microsoft etc. want to

      • with H1-Bs I can get 2, maybe 3 for the price of 1. That's because not only do they work longer hours but they depress local wages too. Or pocket the savings and use them to put the competitors out of business! It's all up to you when you play the H1-B game.

        Good enough will always be good enough. I keep hearing people advance lots of reasons H1-B is a bad idea while every single person who runs a successful business races to get more of them. What do they know that you don't? And it it's nothing than wh
    • Re:Buy American? (Score:5, Insightful)

      by Intrepid imaginaut (1970940) on Wednesday May 15, 2013 @05:18PM (#43735315)

      I think a lot of the better educated in the US are starting to look with interest at Europe's social protections. My sister and her family moved to the land of opportunity a month ago, and are already working out exit options since there's no way in hell they can afford university or health fees for the kids. Yes it's not perfect but you'd be surprised how financially advantageous paying your taxes into social systems can be.

      • Yeah, I'm in the same boat. From what I've been able to determine, the governments in central and northern Europe / Scandinavia just seem to generally work better than do the U.S., U.K., and southern European governments. I'm not going to pretend I know why, but it's looking very, very attractive to me. (I may be particularly sensitized to the issue at the moment, as federal budget sequestration is causing me major problems.)

      • Re:Buy American? (Score:5, Informative)

        by JaredOfEuropa (526365) on Wednesday May 15, 2013 @05:33PM (#43735433) Journal
        Those social protections are part of the problem, or rather, the way some countries implement them. In some EU countries, government has pushed the cost and risk of social measus to employers. An employee falls ill or is injured? Company is obliged to pay for their wages, sometimes for over a year. Need to fire someone? You can't, or you spend a goodly sum getting rid of him/her. Or you have someone off on maternity leave, with the obligation to keep paying her wages, just a few weeks after she joined the company. Yes, it happens, and by law you cannot refuse someone on that ground or even ask about it in a job interview.

        That's all fine and dandy for the worker, and for corporations who can easily absorb the average costs incurred in a large group of employees. But in small startups, having to pay a worker who is unproductive one way or another for a long period of time can kill the company. You can insure against that, but the premiums are unbelievable.
        • Re:Buy American? (Score:4, Informative)

          by JanneM (7445) on Wednesday May 15, 2013 @06:27PM (#43735923) Homepage

          Most of those rules either exempt small companies or they get reimbursed in turn by the state for the costs. In Sweden, for example, the employer pays for the first 14 days of sick leave (which is lower than your regular pay), the state covers anything beyond it. Same kind of thing with the other costs.

        • Re:Buy American? (Score:5, Insightful)

          by Luckyo (1726890) on Wednesday May 15, 2013 @06:45PM (#43736067)

          Not "worker" but "society". These safety nets are created to ensure the future continuity of society through making everyone's future safer. A good example you list is maternity leave. Most of the developed countries already have bare minimum birth rates to hold their populations steady, and many would be in decline if not for immigration. This is a massive time bomb because our retirement systems are designed so that we have enough people providing for those who no longer provide for themselves. As this pool is depleted, societal order built on wealth will collapse. Japan has this problems in a very severe form due to their extreme xenophobia preventing immigration from plugging the short term loss accrued and as a result they're already struggling even though enough time hasn't lapsed for the problem to become even remotely bad. This is the issue of next twenty to thirty years and it's going to keep getting worse during this period.

          So we have a choice: deprive the owner class of some income and give all mothers in the country a significant incentive to get children desperately needed to maintain the society, or award owner class with a bit more money, and make sure that it will be next to impossible to get children unless you're very safe financially and have society hang on the verge of a cliff in twenty years or so due to collapsing birth rate.

          It's called "short term gain versus long term gain". You are advocating the short term gains and fully willing to throw the future under the bus for them. This is a very common way of thinking among those of the current owner class, as they believe that they and their capital will be allowed to leave the society when it starts to collapse and go to another healthy society to parasite off until its eventual collapse. And the circle will continue.

          They are likely wrong, and forgetting the lessons of French Revolution and what happens to owner class alongside everyone else when society really does collapse in a large Western contry. While many of the owner class in the developing countries successfully dodged this bullet and just left for European countries and US after parasiting their own countries to the point of societal collapse, it's highly unlikely that US and European countries will allow for the same thing to happen to them. A far more likely outcome is the way of the guillotine and mob justice on those who remain alongside massive confiscation of property and a complete collapse of society to the point where there are no "healthy economies" to run to due to global impact of a collapse of a large Western country.

          • I'm not suggesting that we do away with these safety nets. It's about striking a good balance. You want companies to pay taxes and not be able to fire people on a whim. But those companies also need some flexibility in their labour force, and security against the financial risks that come with these safety nets. Place too large a burden on companies, and they may up and leave or go out of business. But indulge them just to keep them in your country, and you'll start a race to the social security bottom
            • Re: (Score:2, Informative)

              by Luckyo (1726890)

              But that is exactly what you are suggesting. Or you are simply acting as a "useful idiot" arguing for it for those who do. Because "flexible labor laws" mean "I can own people". Literally. Look at the condition of people who are imported illegally. That is the ideal state of a worker for these employers.

              Slavery is better then that.

      • I think a lot of the better educated in the US are starting to look with interest at Europe's social protections.

        I sure hope so. Even I think some European countries go too far with some benefits, like long paid maternity and paternity leave (yes, I have kids) but the basics are another story. We pay at least half again as much as any other country for healthcare (as %/GDP - it's worse by exchange rate or PPP) yet get no better care. University tuition has reached a point where either you have rich parents or go into debt for life (at high interest rates and, unlike any other loan, can't be discharged in bankruptcy).

      • by whoever57 (658626)

        My sister and her family moved to the land of opportunity a month ago, and are already working out exit options since there's no way in hell they can afford university or health fees for the kids.

        While things can be difficult, there are ways.
        University fees: firstly, live in a state that offers in-state fees to all residents, not just to Green Card holders (permanent residents) and citizens. Secondly, take the general education part of your degree course at community college, so that only 2 years of ful

      • by TheSync (5291)

        I think a lot of the better educated in the US are starting to look with interest at Europe's social protections.

        Eurozone suffers its longest downturn ever as France sinks back into recession [guardian.co.uk]...The eurozone is in its longest recession since it was created, after GDP fell by 0.2% in the first three months of 2012...

    • by chrismcb (983081)

      Hey. I'm an American. Our H1-B visa program has tanked our industry. Substandard code, slipping release schedules, low wages.

      Code was substandard, schedules slipped before the "tanking" of the industry. Some of the best programmers I know were hired on H1B visas... and some of the worst programmers I've worked with were H1Bs... But some of the best programmers I know are Americans, and some of the worst are Americans.

  • by Animats (122034) on Wednesday May 15, 2013 @05:01PM (#43735143) Homepage

    Typical employer whining about not being willing to pay prevailing wages. From the article:

    • "Getting a regular visa wasn't an option because of the salary thresholds"
    • "Canadian cousin flew in to London via Germany. ... She was due to stay with us to help us out with our newborn baby, and also to do some unpaid work experience at my wife's business."

    As usual, it's employers whining that they can't find wage slaves.

    • Quite the contrary. Employers are able to find good workers for a reasonable price and the government is saying no. So meanwhile some guy's new business is struggling to get going and some other guy who had the misfortune of being born somewhere else can't find work. Free trade, by definition, is mutually beneficial to both parties. Meanwhile, people on H1B visas are getting treated like indentured servants, because that's what they are. If you just let workers come over and work for market wages, you'

      • by Intrepid imaginaut (1970940) on Wednesday May 15, 2013 @05:19PM (#43735327)

        Hey, my business plan would work great if only I didn't have to pay people!

      • by rmstar (114746) on Wednesday May 15, 2013 @05:36PM (#43735453)

        Quite the contrary. Employers are able to find good workers for a reasonable price and the government is saying no.

        They want to work for free but the gov says no. It's sensible, because stopping people from working for too little avoids races to the bottom and makes sure everyone gets paid enough (which in turn ensures that the economy keeps moving).

        Free trade, by definition, is mutually beneficial to both parties.

        Only in a simple and sterile world where everything is linear. In truth, it is easy to find examples of free trades that do not benefit anyone. Like the addict and the heroin dealer, both sinking deeper into tragedy as a result of their (free) trade.

      • Free trade, by definition, is mutually beneficial to both parties.

        Another person spouting nonsense about "free trade". It's not by definition, but according to simplistic theory. Furthermore, even that theory requires conditions that often aren't met (e.g. balanced trade). "Mutual benefit" means it benefits both countries in terms of their aggregate statistics (e.g. GDP) and says nothing about the distribution of those benefits. So if 1% of the people got an enormous benefit and 99% got screwed, free trade theory would still call that a net benefit.

        • by TheSync (5291)

          Another person spouting nonsense about "free trade". It's not by definition, but according to simplistic theory. Furthermore, even that theory requires conditions that often aren't met (e.g. balanced trade). "Mutual benefit" means it benefits both countries in terms of their aggregate statistics

          Free trade means two people decide to engage in a mutually beneficial economic transaction, so it benefits both parties. That's a fact.

          Trade statistics don't matter. The US could run a trade deficit forever and bec

    • by tnk1 (899206)

      That depends on if the wage thresholds are reasonable, or if they are simply trying to inflate everyone's standard of living artificially. If the latter, it will crush small businesses who legitimately can't afford to hire expensive employees.

      We're not talking about megacorps here, we're talking about small businesses. Anything that allows them to grow a business is only going to help your country if you know how to keep them here.

      • by ebno-10db (1459097) on Wednesday May 15, 2013 @06:15PM (#43735807)

        We're not talking about megacorps here, we're talking about small businesses.

        So? Small companies that can't survive without special privileges deserve to die. It's a harsh reality called "capitalism" and "competition", though many people seem to like those things only when they're applied to other people. As for "anything that allows them to grow a business is only going to help your country", it's utter crap. If a company isn't competitive in an environment where other companies do fine, it means that company is a failure. Giving it special privileges to stay afloat is called welfare. The resources would be better invested in a competitive company.

  • Hate labor laws? (Score:4, Insightful)

    by i kan reed (749298) on Wednesday May 15, 2013 @05:02PM (#43735151) Homepage Journal

    You might be a greedy scumbag, regardless of the amount of money you have already accrued. Check for the following symptoms: not wanting to pay taxes on money your employees earned for you, feeling it is totally acceptable to dumb toxic waste from your country off the coast of Somalia, or stealing from babies.

    But seriously, this isn't "battling labor laws," this is breaking the law for a higher profit margin.

    • Re:Hate labor laws? (Score:5, Interesting)

      by geek (5680) on Wednesday May 15, 2013 @05:11PM (#43735255)

      You might be a greedy scumbag, regardless of the amount of money you have already accrued. Check for the following symptoms: not wanting to pay taxes on money your employees earned for you, feeling it is totally acceptable to dumb toxic waste from your country off the coast of Somalia, or stealing from babies.

      But seriously, this isn't "battling labor laws," this is breaking the law for a higher profit margin.

      The laws being talked about are the ones where it is literally impossible to fire the employees unless they commit a crime. My company has an entire office full of people in Italy that do nothing because we have no more use for the facility but the local laws do not allow us to fire them. Instead we make them show up every day, for their 7-8 hours and sit in chairs and do nothing. They get paid for this. Some day they will quit and move on to other jobs and they just wont be replaced. However it's been about 3 years so far and they are still hanging around. France is even worse.

      Not to mention the insane amount of paid time off many Europeans get. Honestly, I have a lot of friends in these countries. Many are out of work needlessly. If the government would unpucker its asshole and allow the crap people to be fired, the companies wouldnt be so afraid to hire new ones.

      • by rmstar (114746) on Wednesday May 15, 2013 @05:19PM (#43735339)

        Not to mention the insane amount of paid time off many Europeans get.

        What is insane is how little paid time off people get in the US. I am sure most americans would love to have a decent break every now and then without having to fear that the job is gone when they are back.

        In fact, without having to fear.

      • The more business-astute in these countries just open a seperate business and close it when they need to let people go.

        • by tnk1 (899206)

          You are right, but they are attempting to close that little loophole. The courts are starting to look very unfavorably towards companies that try to liquidate, and then start a new business with all the same customers and the employees they want, but without any of the debt or the other obligations.

      • by SirGarlon (845873)
        The grass always looks greener on the other side of the fence.
      • by girlintraining (1395911) on Wednesday May 15, 2013 @05:33PM (#43735429)

        My company has an entire office full of people in Italy that do nothing because we have no more use for the facility but the local laws do not allow us to fire them.

        We call those types of people Senators over here in the USA.

        Not to mention the insane amount of paid time off many Europeans get.

        Paid time off... that sounds nice. I'm putting in 60 hours this week.

        Many are out of work needlessly. If the government would unpucker its asshole and allow the crap people to be fired, the companies wouldnt be so afraid to hire new ones.

        Sounds like the government may have been reacting to high levels of unemployment by making it more difficult to fire people for crap reasons just to rotate in someone at a lower wage. As I understand it, Europeans take quality of life a bit more seriously than over here -- national health care, a solvent social security system, generous unemployment and welfare packages, vacation days that aren't just stand-ins for sick days, and your CEOs over there don't make 4,500x more than your rank and file. It's almost like they... care about the working class.

        Look, I can appreciate bad laws interfering with commerce and employment. I sympathize. But only to a point. The system we have over here which throws the working class under the bus is not an improvement. I do not often hear of cities in Europe being reclaimed by nature because it was infested with poor people and we didn't care enough to rebuild it. I don't hear about expensive cell phone plans with limited options and everything is locked in by vendor. I don't hear about nightmare housing situations where 20% of a country's homes sit vacant while nearly the same number of people are homeless.

        You may have traded a lack of profit and industry production for a better quality of life and resent that fact, but take it from someone whose country chose the former over the latter: It's bad. It's real bad over here. For every person who "made it" and became a success story, there's dozens who are living hand to mouth and afraid they won't be able to afford food next week.

        Europe has its problems... but choose wisely which ones you want to trade them for.

      • by Xemu (50595)

        Instead we make them show up every day, for their 7-8 hours and sit in chairs and do nothing

        If this is the best use of available resources your company's management can come up with, I suggest replacing management with smarter people.

        Even asking these people to clean toilets would have made the company more money.

      • by ebno-10db (1459097) on Wednesday May 15, 2013 @05:57PM (#43735665)

        The laws being talked about are the ones where it is literally impossible to fire the employees unless they commit a crime.

        No, these are startups whining they can't hire anybody they want from anywhere they want, wages, visas, etc. be damned.

      • Re: (Score:3, Informative)

        by geraud (932452)
        No, it's not impossible to fire people in Italy nor in France. Companies just have to pay adequate compensation for breaking employment contracts. The keyword here is contract, binding both parties (employee not getting unemployment benefits if they are the ones breaking it). Of course most are too cheap to pay.
      • Not to mention the insane amount of paid time off many Europeans get. Honestly, I have a lot of friends in these countries. Many are out of work needlessly. If the government would unpucker its asshole and allow the crap people to be fired, the companies wouldnt be so afraid to hire new ones.

        I agree that it's often too difficult to fire underachievers but sometimes this is also attributable to management capability as much as anything else.

        On the topic of paid time off, in the UK there is a legal minimum of 28 days paid leave. This can include bank holidays such as Christmas and New Years Day. Typically, many workplaces offer between 20-25 days depending on length of service plus the eight bank holidays on top.

        When taken throughout the year, these days are usually enough to allow employees to r

      • Instead we make them show up every day, for their 7-8 hours and sit in chairs and do nothing. They get paid for this. Some day they will quit and move on to other jobs and they just wont be replaced.

        Seriously? I would have to DIE to leave a job like. Literally having 8 hours of "downtime" to work on my own projects? That's a damned dream job right there. Good luck with that.

    • You might be a greedy scumbag, regardless of the amount of money you have already accrued. Check for the following symptoms: not wanting to pay taxes on money your employees earned for you, feeling it is totally acceptable to dumb toxic waste from your country off the coast of Somalia, or stealing from babies.

      You must have missed the part where they said they want to do it legally. There. It's in bold now to be harder to ignore in your frenzied rush to get in a few licks without bothering to check and see that this is Europe, not the United States. You know, with the paying of taxes and the giving of benefits. They want to give those things away. Oh, and vacation days? They have those in Europe. It's some radical liberal idea that just hasn't caught on here. And as for toxic waste and stealing babies... well tha

  • I live outside the EU, but I'm looking to develop software in Switzerland. Apparently it's so difficult for a Swiss company to get a work visa for non-EU (Schengen area) workers, that they're almost never willing to go through the effort.

    Unfortunately, the best way to get permission to live within a EU country is to have a job waiting for you. The chicken-and-egg problem is rather vexing.

    • by 0123456 (636235) on Wednesday May 15, 2013 @05:07PM (#43735203)

      The problem is that the EU allows most people from any EU nation to move to other EU nations. As the locals get fed up with millions of people arriving in their country with whom they have nothing in common, who often can't speak the same language, and who take many of the low-paid jobs that locals used to do, they demand that their politicians do something about immigration. The politicians can't do anything about EU immigration because it's controlled by the EU, so they impose tougher and tougher rules on non-EU immigration, which are counterproductive and fail to solve the problem, but win votes.

      • But does it really fail to solve the problem? Because at least in my case so far, it seems to have had precisely the effect the you said the locals wanted.

        But I guess there are varying definitions of success. I suspect that, rightly or wrongly, they would rather have me: a highly educated person who wants to learn the local non-English languages and integrate with the culture, over some EU citizen who just wants to take advantage of generous welfare benefits.

  • "Importing" labor? (Score:5, Insightful)

    by Noryungi (70322) on Wednesday May 15, 2013 @05:05PM (#43735193) Homepage Journal

    Yeah, right.

    It's more like: "We don't want to pay proper wages for good techies, so we are breaking/bending every rules to exploit cheap illegal labor and keeping more of the venture capitalist money for ourselves".

    Seriously, I have seen this in many a start-up, in France and elsewhere: pay people low - even though their knowledge is what makes your bloody start-up possible - and fire them as soon as they start demanding correct wages and reasonable working hours. Meanwhile, the CEO is looking for the nearest Porsche dealership. It's simply disgusting, and it has nothing to do with France laws and regulations (which can be a pain in the neck, I admit).

    • It's more like: "We don't want to pay proper wages for good techies, so we are breaking/bending every rules to exploit cheap illegal labor and keeping more of the venture capitalist money for ourselves".

      You're confusing Europe for the United States. We just made labor exploitation legal. Not exactly a new concept -- the H1-B visa program might have screwed up, but we built our entire railways at the turn of the last century on the backs of chinese immigrants. The European Union has much stricter laws regarding labor exploitation, and also immigration. It's flat out near-impossible to immigrate into many of those countries. And this is coming from someone who's highly trained, has a college degree, and is i

      • by Noryungi (70322) on Wednesday May 15, 2013 @05:36PM (#43735449) Homepage Journal

        You're confusing Europe for the United States. We just made labor exploitation legal. Not exactly a new concept -- the H1-B visa program might have screwed up, but we built our entire railways at the turn of the last century on the backs of chinese immigrants. The European Union has much stricter laws regarding labor exploitation, and also immigration. It's flat out near-impossible to immigrate into many of those countries.

        Nope. First of all, re-read the original article: we are talking about people working illegally in European countries. It is entirely possible to move to Europe illegally - just like in the USA, get there with a student (or tourism) visa and just stay in the country instead of going back home. Sure, it sucks because you can be caught (asked to provide valid ID, etc.) and sent back to your country, opening a bank account, renting a place, etc. all of these things are somewhat harder to do when you are illegal, but they can be done in every European country that I know of.

        Second, European laws are sinking very fast to the level of the USA. More and more EU countries, under pressure by the same kind of people that are described in the article, are dismantling the only thing that makes life bearable: the protection they gave to their workers. In France, where I reside currently, a law is being considered that would make hiring/firing even easier than in the USA, while reducing social benefits, including firing compensations and unemployment benefits. And it's the same thing pretty much all over Europe.

        Remember that unemployment is rising to never-before-seen levels. Youth unemployment stands around 25%-30% in Southern Europe, and sometimes much higher. In the meantime, start-ups are looking at illegal immigrants for techie jobs... Why is that? Because, yes, these people want to stuff as much money in their pockets as possible.

        Again, this has nothing to do with finding labor - it has everything to do with screwing Joe Techie. Same as the US H1-B visas.

        • Remember that unemployment is rising to never-before-seen levels. Youth unemployment stands around 25%-30% in Southern Europe, and sometimes much higher. In the meantime, start-ups are looking at illegal immigrants for techie jobs... Why is that? Because, yes, these people want to stuff as much money in their pockets as possible.

          We're at 25-30% right now and have none of those protections. We just lie through our teeth about how we calculate our unemployment. I'm not sure giving up those protections will net the result you're looking for. You'll still have unemployment, except now life for 100% of your population will suck, instead of 25%.

      • we built our entire railways at the turn of the last century on the backs of chinese immigrants

        Such provincial West Coast nonsense. Elsewhere in the country we built the railroads on the backs of Irish immigrants.

    • It doesn't help that the people doing the hiring don't seem to understand the difference between "AAS, no experience" and "20 years of doing exactly what you're looking for". I'm frankly sick to death of these places wanting (and expecting) a skilled technician to be available 24/7/365 for a pittance. Why in the fuck can't we unionize again?
  • great reasoning! (Score:4, Insightful)

    by Njovich (553857) on Wednesday May 15, 2013 @05:06PM (#43735199)

    Along the same line of reasoning, you should just steal that Porsche that you are selling, as it would have been impossible, or simply too expensive, to buy it officially.

    Yes, of course it's a pain in the ass that you can't just hire people in 1st world countries for 3rd world prices. However, if we want to maintain our social system, that's not viable. So they should either hire them in the low wage country themselves, or pay a good price for this skill they say is not available on the local market (depending on country, that means a salary between 2500 and 5000 euro per month to be eligable for a highly skilled migrant visa). If it's really such a uniquely skilled person, that should be no problem of course?

    • of course it's a pain in the ass that you can't just hire people in 1st world countries for 3rd world prices

      But ... but ... but without that a third rate knockoff of the last second rate copy of a failed social networking idea might not stay around long enough for the founders and VC's to rake off some skim. Without "people in 1st world countries for 3rd world prices" it's hard to make money. Sometimes you need good original ideas and to run things well. Outrageous!

  • by mspohr (589790) on Wednesday May 15, 2013 @05:07PM (#43735211)

    Capitalists want the cheapest labor possible. They don't want to pay for frivolous things like health insurance, unemployment insurance, vacations, sick leave, etc. Europe has better protections for workers than the US but both are pretty onerous when you just want people to work hard for no money. That's why China and Bangladesh are so attractive. You can exploit people there much better than in more developed countries.
    Yeah! Capitalism!

     

    • Capitalists want the cheapest labor possible.

      The main past-time of so-called entrepreneurs seems to be whining to mommy government to give them special breaks because their business models are otherwise unprofitable. Funny how, the current recession (exacerbated by the austerity preferred by most so-called entrepreneurs) notwithstanding, there are lots of successful European companies. If that brilliant startup of yours can't hack it in that environment, it's probably because the startup ain't so brilliant. Heaven forbid any "entrepreneur" or their in

      • by idontgno (624372)

        Well, defending the facility and all your lines of communication against land pirates [telegraph.co.uk] would suck something fierce. Your physical security costs will be breathtaking. But it might still profit better than fair labor, ethical tax payment, and socially responsible environmental practices.

        Once you've sold your soul, the rest is pretty affordable.

    • by tnk1 (899206)

      And consumers want the cheapest prices available for products.

      So, riddle me this: how do you pay your workers a lot of money, but offer a cheap product?

      • by ebno-10db (1459097) on Wednesday May 15, 2013 @06:40PM (#43736015)

        So, riddle me this: how do you pay your workers a lot of money, but offer a cheap product?

        Henry Ford figured it out. Anyone who can't doesn't deserve to stay in business.

      • by mspohr (589790)

        Apple seems to be able to charge a lot for their computers and phones. They use cheap Chinese labor so they make a lot of profit. They could pay workers better if they weren't so greedy.
        If Walmart took its entire $22 billion of annual pre-tax income and used all of it to give each one of its 2.1 million employees a raise, this would amount to about $10,000 a year apiece.
        In 2004, a year in which Wal-Mart reported $9.1 billion in profits, the retailer's California employees collected $86 million in public ass

        • by TheSync (5291)

          If Walmart took its entire $22 billion of annual pre-tax income... ...then it wouldn't be able to pay its taxes!

          Walmart paid $6 billion in US taxes last year. How much did you pay?

  • They'll bring in fresh Indian graduates for no more than 3 months at a time at 20% each of what you're paying your local developers. When one guy finishes, he'll go back to India and his replacement will arrive. The only fly in the ointment is that he'll have to be trained from zero. And the cycle repeats.
  • by mwvdlee (775178) on Wednesday May 15, 2013 @05:22PM (#43735361) Homepage

    the fudges, shortcuts, workarounds and, in some cases, 'strategic decision-making' are — just about — getting their companies the talent they need.

    the fudges, shortcuts, workarounds and, in some cases, 'strategic decision-making' are — just about — getting their companies the price they need.

    FTFY.

  • by Bob9113 (14996) on Wednesday May 15, 2013 @05:57PM (#43735667) Homepage

    not only to avoid France's notoriously onerous labor laws but also because it would have been impossible, or simply too expensive, to import them officially.

    I took the same approach when I opened a bar that offered drinks for half the price of the competition. I couldn't afford to buy my booze officially, so instead I was knocking over liquor stores. It's the only way I could make my business model work, which completely justifies it.

  • by dutchwhizzman (817898) on Wednesday May 15, 2013 @06:13PM (#43735799)
    Europe isn't like the USA. The countries have different languages and laws. Not like state laws in the USA, but real country laws. Sure, EU legislation is deminishing these, but there still is a lot more difference in EU countries than there is in the USA. French labor laws are considered borderline communistic by some other EU countries. On top of that, a lot of French IT companies insist that candidates speak fluently French, while in a lot of EU countries English is sufficient, even if that's not the native language where the company is. In the UK, Netherlands, Germany and several nordic countries, this whole article is not relevant at all. There are probably several other countries to which this applies as well, but I have no direct contacts there so I can't speak for those.
    • And one guy opinion may not be representative of the whole of France. I happen to work in a start-up in France, many of my colleagues are foreigners for all around the world (not counting EU people as they're free to work here so not a problem for them). Yes there is some paperwork to do, but if you have a competent HR or go through external competent HR consulting it can be done. It could be more fluid and smoother for sure, nothing is perfect. But it's not as dire as often painted on the web. It adds dela
  • startup whiners (Score:5, Insightful)

    by joe545 (871599) on Wednesday May 15, 2013 @06:23PM (#43735889)

    That whole article sums up what is wrong with these venture capitalist funded start-ups; they want to compete on a different playing field than established companies. They want to be able to import cheap labour from other countries as they aren't willing to pay the going rate for local engineers. They don't want to register their employees properly as they will be liable for more taxes and to give their employees the rights they are entitled to.

    As a European, I'm glad these guys are finding it difficult to ride roughshod over the laws has to protect workers. If you can't afford to do things the proper way then your business is not viable. Complaining that you can't find exploitative loopholes that depress wages for the rest of us is laughable.

    • That whole article sums up what is wrong with these venture capitalist funded start-ups; they want to compete on a different playing field than established companies.

      That's only in Europe. In the US we have a level playing field: both new and established companies, large and small, demand the right to import the cheapest labor they can.

  • by Anonymous Coward

    Tim Horton's, a freaking donut shop, has been using the 'skilled worker' loophole in labour laws here to import "temporary foreign workers" (H1-B analogue). They were claiming there were no Canadian workers able to fill the positions. At what they are willing to pay, perhaps, but that's the real problem isn't it?

    Royal Bank of Canada was playing similar games, under the guise of "internal position transfers" which were supposed to be limited to people with unique expertise, and for short terms like 6 weeks -

  • by manu0601 (2221348) on Wednesday May 15, 2013 @10:33PM (#43737551)
    The company wants to "avoid France's notoriously onerous labor laws", but it still operates in France, rather than India or China. There must be some reason for that choice. Perhaps some reason paid by taxes, or even guaranteed by labor laws...

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