The company made the cost-cutting move as it navigates a slump in advertising created by the pandemic.
- May 29, 2020Updated 2:30 p.m. ET
OAKLAND, Calif. — Google, facing an advertising slump caused by the pandemic, has rescinded offers to several thousand people who had agreed to work at the company as temporary and contract workers.
“We’re slowing our pace of hiring and investment, and are not bringing on as many new starters as we had planned at the beginning of the year,” Google said in an email to contracting agencies last week that was seen by The New York Times. The company told the firms that it “will not be moving forward to onboard” the people that the agencies had recruited to work at Google.
The move affected more than 2,000 people globally who had signed offers with the agencies to be a contract or temp worker, according to three people familiar with the decision, who spoke on the condition of anonymity because they were not allowed to speak publicly on the matter.
Google employs more than 130,000 contractors and temp workers, a shadow work force that outnumbers its 123,000 full-time employees. Google’s full-time staff are rewarded with high salaries and generous perks, but temps and contractors often receive less pay, fewer benefits and do not have the same protections, even though they work alongside full timers.
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The coronavirus crisis has underscored that disparity. Google announced in April that it was extending its employee paid leave policy to 14 weeks from eight weeks for caretakers, including parents looking after children whose schools are closed. For employees working from home, Sundar Pichai, chief executive of Google’s parent company Alphabet, said on Tuesday that they could spend $1,000 for equipment and furniture like standing desks and ergonomic chairs.
Many of the contract and temp candidates who had agreed to work at Google before the pandemic took hold in the United States were let go without any severance or financial compensation. This came after weeks of uncertainty as Google repeatedly postponed their start dates during which time they were not paid by Google or the staffing agencies.
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Some of the would-be contractors left stable, full-time jobs once they received an employment offer at Google and are now searching for work in a difficult labor market. Some, who are Americans, said the rescinded offers have complicated and, in some cases, delayed their ability to receive unemployment benefits because they left their last jobs voluntarily, according to several of the workers facing this quandary.
In mid-April, Mr. Pichai told employees in a memo that the company planned to “significantly” slow the pace of hiring this year, with the exception of several strategic areas. A company spokeswoman said at the time that Google intended to bring on the people who it had already hired but who had not started.
But this did not seem to apply to contractors or temp workers for Google and Alphabet, which has a market capitalization of near $1 trillion dollars. It made $6.8 billion in profit in the first three months of 2020, despite what it called “a significant and sudden slowdown” in advertising.
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“If these people were promised jobs at Alphabet, which is worth a trillion dollars, it seems like the company has a responsibility to take them on,” said Ben Gwin, who works as a data analyst in a Google office for HCL America, a contracting agency. “It’s not like Google can’t afford it.”
Mr. Gwin led a unionization effort for contract technical workers at Google’s offices in Pittsburgh last year.
“As we’ve publicly indicated, we’re slowing our pace of hiring and investment, and as a result are not bringing on as many new people — full time and temporary — as we’d planned at the beginning of the year,” said Alex Krasov, a Google spokeswoman.
Ruth Porat, chief financial officer for Alphabet, told analysts last month that the company was cutting expenses by not hiring as many new employees as initially projected. She did not address contract or temp workers.
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Google has taken some steps to help its temp and contract workers. In March, the company said it would extend the assignments of temp workers whose jobs were scheduled to end from March 20 to May 15 by 60 days.
The company also said it would continue to pay contract workers affected by office closures such as people who serve food in the company’s cafeterias. And it established a fund to allow contingent workers to take paid sick leave if they exhibit coronavirus symptoms or can’t come to work because they’re quarantined.
Like many technology companies, Google depends on a large number of temps, vendors and contractors to perform a wide variety of jobs, including cafeteria workers, maintenance workers, recruiters, content moderators and software testers. For the company, these workers cost less than full-time employees, and Google has no long-term obligation to them, making it easy to hire them or eliminate their positions.
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Last year, 10 Democratic senators called on Google to convert its temporary and contract workers to full-time employees, saying the company should stop its “anti-worker practices” and treat all of its workers equally.
Google pays staffing companies to find the workers and provide them with salaries and benefits as their employer. But Google interviews prospective candidates and signs off on hiring, deciding where they work, what they do and when to fire them.
When Google pulled the offers to prospective workers, the company told the staffing companies, which included firms like Accenture, Cognizant and Adecco, that “we’ll look to you to have the conversations with the individuals who won’t be onboarded.” Google said it was “hopeful” that the “agencies will be able to find other assignments” for the candidates.The Coronavirus Outbreak
Today’s Question: My state is reopening. Is it safe to go out?
States are reopening bit by bit. This means that more public spaces are available for use and more and more businesses are being allowed to open again. The federal government is largely leaving the decision up to states, and some state leaders are leaving the decision up to local authorities. Even if you aren’t being told to stay at home, it’s still a good idea to limit trips outside and your interaction with other people.
It was not immediately clear which countries were most affected in the decision, but some of the workers are in the United States, India and the Philippines. This was the second wave of rescinded job offers for temps and contract workers. Google had pulled offers for several dozen temp workers in April.
Joli Holland was one of the candidates whose job offers was rescinded in mid-April. She was working as a lead teller at Wells Fargo when Adecco contacted her about a recruiter position working at Google in Mountain View, Calif. After a few rounds of interviews, she was offered the position with a start date of March 23.
She was hopeful that she would get her foot in the door with a temporary job and land a full-time position at Google. Before she gave her two-week notice to Wells Fargo, she checked with Adecco about whether the job at Google was safe given the growing concerns about the coronavirus. Ms. Holland said she was assured that everything “should be fine.”
Another candidate whose offer was rescinded expressed similar concerns to another recruiter at Adecco. This person, who asked not to be identified because they still wanted to work at Google and were worried about being blacklisted for speaking out, said the recruiter said “Google always does the right thing, so I wouldn’t worry about it.”
Mary Beth Waddill, a spokeswoman for Adecco, said the company did not intend to mislead anyone about their career prospects, “especially given the uncertainty of the Covid-19 pandemic. Our standard practice is to advise in writing that placement on assignment is not guaranteed.”
A few days before Ms. Holland was set to start, she was told that her start date at Google would be pushed back to April 6. Then it was postponed to April 13 and again to April 20, a Monday. On the Friday before she was set to begin her job, Ms. Holland said she was told that the company was rescinding all temp worker offers. She didn’t receive any money while she waited to start at Google, nor did she get any severance.
“I’m disappointed, because not a lot of people are hiring right now,” she said. She hadn’t filed for unemployment because she left her last job voluntarily. Still, Ms. Holland said she still hoped to work for Google because it would still be a great opportunity.
“I am disappointed, but it hasn’t completely soured me on the company,” she said. “I’d still like to work there.”Google’s Shadow Work ForceGoogle’s Shadow Work Force: Temps Who Outnumber Full-Time Employees