Summary
Topics include: Hiring of permanent workers and using temporary/contract workers.
Discussion
Hiring of Permanent Workers
There are just a few things to mention about hiring.
The Work Group Leader Heads Hiring
The Work Group Leader is the main actor in the hiring process. He initiates a request to hire, screens applicants, conducts interviews, negotiates compensation, and oversees the decision to make an offer. To extend an offer to a candidate, he must have the approval of the Unit Leader and his Work Group.
Work Group Members Participate in Hiring Process
As the Work Group members will be working with the new hire and as they have the power to remove a worker from the Work Group, they must agree to extend an offer to a candidate. They should be allowed to participate in the hiring process to the extent they desire. Some workers will choose to be more involved than others. The Work Group Leader should allow the Work Group members to review applications and resumes, meet and greet candidates, and conduct group interviews of finalists.
Educating Candidates and New Hires about Liberty Workforce is Critical
Potential new workers need to be educated about Liberty Workforce so that they can make informed decisions to join. Worker-Owner shared governance should be explained generally with a principal emphasis on the Work Group. Brief mention needs to be made about how they will be members of an LLC and not employees. They need to be fully informed about the variable compensation system including historical pay and profit sharing percentages. They should be counseled that they should live below their means and save money in order to weather the down times. New hires need to be taught more in detail about the Constitution, the Ownerle-Workerle lease, and the Workerle operating agreement.
Barriers to Joining and Leaving the Workerle Should Be Low
Joining and leaving the Workerle should be fairly easy. Barriers to entry might keep out the best of the best. Where capital investments in the Workerle are required by state law, they should be kept nominal (e.g., $1). Some firms require large investments from their workers in order to participate in the governance. They reason that having so much invested will cause workers to stay around longer and to work harder to protect their investment. In practice, it will probably be found that they don’t work harder because of this. Their investments are generally protected by exploiting the non-vested workers through lower pay, longer hours, and layoffs. However, in some cases, the large investment might trap a worker into staying when he wants to leave. A trapped worker is not as productive as one who wants to be there. The Workerle should seek to maintain workforce stability by being the best place to work.
One exception to the “easy to leave” policy is stock option vesting for startups. Key workers who leave during a startup can cause work disruptions (e.g., loss of product knowledge, spin up costs for the replacement worker, etc.) that are adverse to the success of the startup. A vesting schedule reflects these realities by rewarding workers who don’t leave.
Temporary / Contract Workers
The Workerle needs the option of utilizing temporary/contract workers where appropriate. There are roughly three kinds: truly temporary, temporary who are really permanent, and project/seasonal. The first is always appropriate. The second is never appropriate on site. The third might be appropriate.
Truly Temporary Workers
The truly temporary worker is one who is hired to fulfill an anomalous, short term need. Examples: to fill in for a worker who is ill, to publish and ship training materials for an occasional seminar, etc. Where the need arises, the use of temporary workers through an agency would be appropriate provided legal concerns are met (see below).
Temporary Workers Who Are Really Permanent
The second kind of temporary/contract worker is the outsourced or the temporary who is really permanent (called “permatemp” for short) worker. These are not temporary workers. They are permanent workers who are not employees of the business using their services, but are employees of a contract labor agency. If these workers perform their services on the premises of the Workerle, it will create a “class” society with all its evils. The members of the Workerle will have governing rights, but these workers will not. Liberty Workforce is to give workers the right to share governance of their workplace. It is hypocritical for members of a Workerle to utilize these permanent workers at the Workerle facilities. Rationalizations to do so have about the same moral legitimacy as those employed by Americans trying to justify owning slaves. This kind of permanent contract employee must not be utilized on Workerle premises or in association with Workerle members.
This prohibition does not apply to outsourced work performed at a non-Workerle facility. But, even in this case, the Workerle might wish to use whatever influence is available to it to promote the principles of the Liberty Workforce in the businesses where the outsourced work is performed.
Project and Seasonal Worker
The third kind of temporary/contract worker is used to complete projects or perform seasonal work. This work is not anomalous, but is a characteristic of the industry. For example, software workers may be contracted to work on a project lasting months or even years. Once the project is complete, they are let go. The harvesting of farm crops is an example of seasonal work. It occurs every year, but only for a few months each year.
Considering the legal and social issues, it is recommended that these seasonal and project workers be members of the Workerle while they are working at the Workerle. They would have all the rights and privileges of other workers except those concerning involuntary separation. The laws of the Workerle for separation of these workers should follow procedures customary to their industry. For example, when laying off these workers, only proper notice is given to them. Nothing like an act of Congress or a court trial is required.
Another possible exception for these workers might be necessary where they comprise a majority of the workers. While they should be able to participate in the governing of the workplace, an analysis of the Workerle operating agreement and the Constitution should be made to assure that the temporary workers will not have the ability to take over the Workerle.
Compensation for Temporary/Contract Workers
The question arises as to whether compensation to temporary/contract workers should be fixed as is standard practice in business or whether it should be variable like for normal members of the Workerle. Short term workers would generally desire fixed compensation. They will not be there long enough for the peaks and valleys of compensation to average out. But, for long term temporary/contract workers, there are additional considerations. Fixed pay with no profit sharing creates one more artifact of disunity in the Workerle. Short sighted workers on variable compensation may resent it when temporary/contract workers on fixed pay receive more compensation during a downturn. Furthermore, paying temporary/contract workers fixed wages is only prudent when they are a small fraction of the total Workerle population or when times are good. If there is a large fraction of workers on fixed pay during a downturn, it will multiply the reduction in compensation to the permanent workers. In the worst case, quick and massive layoffs of temporary/contract workers would be needed to preserve some compensation to the permanent workers and avoid bankruptcy of the Workerle. Fixed wages for a large temporary/contract workforce therefore reduce business robustness.
Legal Concerns about Temporary/Contract Employees
The Workerle should be careful when utilizing temporary/contract workers who are not members of the Workerle. The Workerle has no employees and therefore, it is not likely that it has to comply with state and federal laws governing employers and employees. However, employing temporary workers directly will certainly require compliance with these laws. Considering how these governments are, having one temporary employee somewhere may require compliance with the laws everywhere. It is less certain what compliance to these laws would be required when temporary workers are obtained through a contract with a temporary agency who is their actual employer.