Never relocate unpaid

Someone asked me, a few months ago, if he should take a Silicon Valley (actually, San Francisco) job offer where the relocation was a “generous” $4,000. I told him to negotiate for more and, if the company wouldn’t budge, to decline. For an adult, that’s not a relocation package. That’s half-assery. 

I won’t get too particular on the details, but this person lived on the East Coast and had children. For an adult of any kind facing a cross-country move, $4,000 is not a generous relocation package. It’s downright pathetic. Movers don’t work for equity. A full-service move for an adult, with a family, costs at least twice that number. When you move for a job, your employer is still going to expect you to start as soon as possible and be 100% on-the-ball in your first weeks. You can’t take on a self-move and start a new job properly. If you do have that kind of energy, it means you’re the alpha-trader type who should be on Wall Street, not taking employee positions at startups. For the 99.99% of us who are mere mortals, taking on a self-move means you’ll be slacking at your job in the first weeks and, while slacking might be OK when you’re 3 years in and just waiting for something better to come along, it’s not a way to start a job– especially not a job you moved across the country to take.

In addition to the small size of that package, I think lump-sum relocations are a bad deal in general. I think they fail for both sides. They’re bad for the employee because, in addition to losing a chunk of it to taxes, the lump-sum arrangement leaves it to the employee to make arrangements and haggle. The employer, however, risks getting the amount severely wrong, while not getting the major benefit of a relocation, which is a 100%-focused employee with high morale, because the employee still has to haggle with movers and manage minutiae. A good employer, knowing how toxic moving stress can be, will solve every niggling, stupid little problem that comes up in the process of relocation. They’ll have a trusted moving company, rather than expecting the employee to make the calls and compare costs. (If the moving company’s client is the company, rather than you, they’ll do a good job because they want repeat business– a concern that isn’t there with “man with a van” outfits.) They’ll manage the flight and, with a high-quality placement agency involved, have an interview per day lined up for the spouse until he or she gets a good job. If you’re moving internationally, you’ll get an extra week or two of vacation (and you won’t have to ask for it) each year and they’ll have tax equalization already worked out. Why? Because genuinely good employers (who are rare these days) want their best people on, 100 percent, rather than phoning it in at their jobs because they’re fighting little piss fires in their personal lives.

I know that relocation is derided as an “old-style perk” in the Valley. If you broach the subject, you risk seeming entitled, high-maintenance, and worst of all, old. Most companies in the Valley don’t fall under the “good employers” qualification. Most of these Valley “startups” are just long-shot gambles running on a shoestring budget, and their real purpose isn’t to build businesses but to try out middling product managers (called “CEOs” of semi-existent, non-autonomous companies) for promotion into the investor ranks (EIRs or associates or partners at VC firms). The reason they can’t pay or relocate properly is that, while investors are handing these half-companies pennies and saying “Humor me”, even their own backers don’t trust the companies enough to take a real risk and give them the resources that’d enable them to pay real salaries and benefits. This raises the question, for the employee: if the investors aren’t willing to bet on that business, then why should you?

Anyway, this person didn’t heed my advice, took the job anyway, left a few months later and, from the titles and prestige of the following company, the next move appears to have been a demotion. I can’t speak for what happened or whether my perception (based on LinkedIn) of a demotion is correct. I generally cut ties with people who make bad decisions, so I haven’t heard his side.

California, here we come

So, there’s an epidemic of Shitty Relo (or even nonexistent relo) in Silicon Valley and it’s California arrogance at its finest. I need to address it, for the good of society. The mythology justifying it is that California is such a wonderful place to live, with its traffic and absurd real estate prices and brogrammers, that a $2,500 relocation package for an adult (meaning, here, 25+ and no longer allowed to live without furniture, because it’s just not socially acceptable to sleep on a hand-me-down mattress with no bed) is to be taken as a perk rather than a fuck-you. 

This culture of cheapness is disgusting. One time a couple of years ago, I spoke to a startup about a supposedly “VP-level” role and, when it came time to discuss an on-site interview, they asked if I could apply to another company (that would cover travel costs) and “piggyback” their interview process on the same day– that is, go to them in the evening after an all-day interview with another company– sparing them the cost of flights and a hotel. At that point, I stopped returning their calls, because I knew that if they couldn’t spring for airfare, they wouldn’t be willing or able to do the right thing when it came to relocation, so there was no point in continuing. 

Frankly, I think that the “we don’t do relo” policy is short-sighted if not idiotic. I checked my almanac to be sure, but the world is very big. No metropolitan area has anywhere close to a dominating share of the global talent pool. The Bay Area has some impressive people (and a much larger number of not-impressive people who still command impressive salaries) but if you’re serious about competing for talent, you just can’t restrict yourself to one geographic area. Not in 2014. Either set yourself up to be distributed (which is hard to do) or man the fuck up and pay for talent and pay for it to move. Otherwise, you aren’t serious about winning and you deserve to lose.

Oh, and another thing…

Then there is the matter of relocation clawbacks. Many companies put a stipulation on a relocation package that it must be repaid if the employee leaves within a certain timeframe. On what moral grounds is this OK? Did that employee not suffer the costs of relocation, either way? Do movers reimburse a person who relocated for a job that turned out to be a stinker? Of course they don’t, because they still did the work and that would be ludicrous. Almost no one joins a job expecting to leave in a year, which means people only will do so if things get really shitty. Why make it worse, by imposing a ridiculous penalty, if things go bad? Chances are, if the employee is willing to leave a company in the first year, that the company is partially at fault. The purely opportunistic “job hopper” is a hated straw man for employers, because the reality is that at least 75 percent of employers are just shitty (and bad at hiding it, so savvy people leave quickly). I don’t know why it’s considered a virtue to waste one’s life by investing in an employer that isn’t invested in one’s own career. It’s not. 

Clawbacks aren’t usually a big deal (it’s not hard to stay at a company for a year) but they send a strong signal: we employ at least one person who enjoys shitting in places where fecal matter doesn’t belong. That clawback clause didn’t appear by accident. It’s not likely that cosmic rays hit the hard drive where the contract template was stored and just happened to put additional words there. Someone in that company, at some time, made the decision to include a clawback clause. And I’m sorry, but the people who try to earn their keep by shitting on things should be fired. Companies are complex beasts and need a wide variety of services to maintain and grow them. What they don’t need are people who indiscriminately shit on things because it amuses them to leave festering piles of dookie all over the company. If I wanted to see creatures shitting indiscriminately, I’d go to the zoo. The issue with a relocation clawback isn’t the economic risk for employee, but the fact that the company actually retains someone who took the time to put that garbage in the contract.

The bigger problem

In this essay, I’ve Solved It with regard to relocation, because it actually is a simple issue: if you’re a company, play or go home. If you’re a prospective employee and you’re offered an inadequate relocation package, turn the job down. If the company was serious about winning, they’d give you what you need to pull off the move properly. These, “oh yeah, we offer $2000″ fly-by-night startups aren’t serious about winning. They don’t need top talent. What they need are clueless, naive, true believers who’ll throw enough hours and youthful enthusiasm behind a bad idea to continue the founders’ campaign to defraud investors. It’s best if those true believers don’t have families, because their spouses might “disrupt” (I had to use that word) them with questions like, “why are you working more than 40 hours per week, at a company that only gave you 0.02% in equity?” It’s best if they’re under 27 and don’t mind taking on the insane risk of going into an extremely expensive city without an offer of temporary housing.

Of course, there’s one exception. If you will have at least 20 percent equity in the company, you might consider taking on the risk of an unpaid relocation. That’s right, 20%. You have to be partner-level for it to make sense, and prior to external investment, anything less than 20% is not partner level. (After external investment, full relocation should be a given for all key players.) Don’t take partner-level risk for an employee-level role. It doesn’t engender respect; it shows weakness. 

So what’s the bigger issue? What I’ve noticed about such a large number of startups, in the Valley and elsewhere, is that they’re disgustingly cheap. Cheap things are usually of low quality. Exceptions exist, but they’re rare and if your business strategy is based on cheapness, you’ll fail, because opportunities to buy something of high quality at a low price are usually far too intermittent to build a company on them. Also, one thing you learn in technology is that low-quality components often corrupt the whole system. If you pour a cup of wine in a barrel of sewage, you have a barrel of sewage. But if you pour a cup of sewage in a barrel of wine, you also have a barrel of sewage. Most VC-funded companies are launched with absolutely no understanding of this principle. They’re designed to be as stingy as possible in the hope that one “home run” company will emerge from the chaos and pay for the hundred failures. Occasionally, the idea is so good that even terrible health benefits and sloppy HR and closed allocation won’t block a success. These opportunities only emerge a few times in each generation, but they do exist. In general, though, a company designed poorly and with low-quality components (management, policies, mission and founding principles) will just be a loser. VCs can afford to generate hundreds of losers because they’re diversified. Rank-and-fire employees can’t. 

In reality, a company succeeds not by being as cheap as possible, but focusing on the delta. What are you paying, and what are you getting? Cost-minimization usually leads to low quality and a minuscule if not negative delta. A new Volkswagen GTI for $20,000 is a great deal. A beat-up clunker unlikely to last a year isn’t worth $1,000, and is likely to cost more in headaches and maintenance than buying a quality car. In general, both extremes of the price spectrum are where the worst deals are found. The high end is populated by Veblen goods and dominated by the winner’s curse, while the low end’s psychological and technical advantages (some purchasers will always buy the cheapest option, and sometimes this is by regulation) to the supplier render it protected, often allowing quality to fall to (or below) zero. In hiring, just as with commodity goods, this is observed. Overpaid executives are often the most damaging people in an organization, and paying them more doesn’t improve the quality of people hired; on the other hand, the desperate employees willing to take the worst deals are usually of low or negative value to the business. 

The actual “golden rule” of success at business isn’t “buy low, sell high”, because opportunities to do so are extremely rare, and “carrying costs” associated with the wait for perfect deals are unaffordable. Instead, it’s “maximize the spread between your ‘sell’ and ‘buy’ price” or, for a more practical depiction that sounds less manipulative, “sell something that is more than the sum of its parts”. With some components, the right move is to buy high and sell higher. For others, it’s to buy low and sell less-low. For example, in software, you probably want to take the “buy high and sell higher” strategy with employees. A competent software engineer is worth $1 million per year to the business, so it’s better to hire her at $150,000 (which, in current market conditions, is more than enough to attract talent, if you have interesting problems to solve) than to hire an incompetent at any salary. Talent matters, which means that to spend on salary and benefits and relocation is worth it. The way you win in software is to buy high and sell higher. That said, “buy high” also means you have to buy (in this case, to hire) selectively, because you can’t buy many things if you’re buying high. Unfortunately, people who have sufficient talent to make those calls are rare (and most of us are irrelevant bloggers, not investors). MBA-toting VCs like cheapness because, without the ability to assess talent and make those calls, the scatter-shot approach is all they have. 

I think it’s important, before I go further, to focus on the difference between genuine constraint and stupid cheapness. Before venture capital got involved in small-business formation to the extent that it has (largely because bank loans now require personal liability, making them a non-starter for anything with a non-zero chance of failure) most emerging firms were legitimately limited in their ability to hire more people. “Lean” wasn’t some excuse for being mean-spirited or miserly; it was just the reality of getting a company off the ground. If the constraints really exist, then play within them. If you can barely afford salaries for your three founders because you’re bootstrapping on scant consulting revenue, then maybe you can’t afford to pay their relocation costs. The problem with the VC-funded cheapness is that those constraints really don’t exist. “We can’t afford $X” is predicated on “We only have 100X and need to hire 100 people” which is predicated on “We’re going to hire such mediocre people that we need 100 of them to get the job done”, and that mediocrity wouldn’t be such an issue if $2X were offered instead. If $2X were offered, the job might be feasible with 15 people, but the VCs aren’t able to assess talent at that level, nor pick founders who can, so it’s easier for that class of people to just pretend that talent differentials among engineers don’t exist and implement a closed-allocation MBA culture. 

Mindless, stupid cost-cutting isn’t limited to startups. Large corporations show this behavior, as well, and it’s easy to explain why it’s there. Those who can, do. Those who can’t, evaluate and squeeze. This evaluation process can take many forms, such as micromanagement; but a complementary form is the senseless and mean-spirited penny-shaving of the modern corporate bureaucrat (“I don’t think you need that!”) It takes no vision to “cut costs” in a way that, in 99% of cases, actually externalizes costs to somewhere else (low-quality technology, morale problems, environmental impact). Penny-shaving is what stupid overpaid fuckheads do to justify their executive positions when they don’t have the vision to actually lead or innovate. They cut, and they cut, and they cut. They get good at it, too. Then they start asking questions like, “Why are we paying full relocation for these experienced programmers, when there are a bunch of starry-eyed 22-year-olds with California dreams?” Six months later, that’s answered by the cataclysmic drop in code quality, which is starting to bring major pain to the business, but the cost-cutting idiot who had the idea has already gotten his promotion and moved on to fuck something else up.

When companies balk at the concept of offering a proper relocation, the message it sends to me is that they’re in the business of squeezing zero-sum petty wins out of their employees, rather than vying for actual wins on the market. 

Conclusion

Most software engineers don’t know what they’re getting into when they enter this industry, and spend more time than is reasonable being a loser. I can’t claim innocence on this one. There were jobs where I worked for shitty companies or inept managers or on pointless projects for a variety of reasons that seemed to make sense at the time, but were almost certainly errant. Don’t make that mistake. Don’t be a loser. The good news is that that’s rather easy to control. One can’t change one’s level of talent or influence the large component that is truly luck, but avoiding loserism has some straightforward rules. Don’t work with losers. Don’t work for losers. (Don’t fight against losers either. That’s a mistake I’ve made as well, and they can be vicious and powerful when in groups.) Don’t make excuses for people who don’t seem to be able to get it together and play to win. Stick to the people who actually want to achieve something and will bet big on the things that matter, not the 95% of VC-funded founders and executives just trying to draw a salary on a venture capitalist’s dime (despite all that paper-thin bullshit rhetoric about “changing the world”) while squeezing everyone else at every opportunity. 

Unless you’re a founder and the resources simply don’t exist yet, never relocate unpaid. If the company actually sees you as a key player, and it cares about winning more than zero-sum cost-cutting, it will solve your moving problems for you, so you can get to work in earnest on your first day. 

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38 thoughts on “Never relocate unpaid

  1. But what if theft, abuse and exploitation of others are the real reasons for running commercial enterprises?

    If you look at history, almost all human enterprises from the first fiefdoms and cults to empires and global religions were always centered on stealing, abusing and exploiting others in exchange for nothing or less than nothing. Establishing the rule of law, enforcing justice and pleasing gods were just the cover stories or justifications for their parasitic behavior.

    A secular religion based in exchanging money requires its own myths, justifications and cover stories to keep up the charade.

  2. To synthesize your ideas, I think any ruling elite has a choice – beyond a certain point, they can care about enrichment, or they can care about control. The thrill of having stuff vs the thrill of bossing people around. Enrichment, the pleasure of getting stuff, comes at a cost – the people enriching you gain leverage. After all, they can always turn off the pump, stop working, half-ass the job, go on strike. To gain enrichment, you have to give up some control. Although America’s business elite has traditionally cared more about enrichment, I get the sense that now all they want is control. As you have pointed out, the software industry is dominated by policies that undermine worker morale and productivity at every turn, even when it results in inferior products and lower revenue. It all exists for a reason. It’s the same reason Communists did everything they could to undermine people’s productivity – take away their productivity, and you take away their power.

    • Good post. I believe its gone beyond that, the elites are so hungry to stay in power, simply for the fact of staying in power, that they’ve effectively forgotten that the crops aren’t being planted, and the oppressed simply aren’t able to produce anything under such oppression.

      Most of the contemporary tech sector, especially the social media and advertising firms, is a big fat zero. They produce nothing. They do not earn money (and even the ‘profitable’ ones, if denied the benefit of generous transfer pricing and tax avoidance schemes, would have no GAAP-compliant earnings). The scams they pull against their own employees and potential employees, ranging from H-1B visa abuse, to not even treating job applicants professionally are, at the very least, prima facie evidence that most of the firms are not really looking to create shareholder or societal value.

  3. “Most of these Valley “startups” are just long-shot gambles running on a shoestring budget, and “their real purpose isn’t to build businesses but to try out middling product managers (called “CEOs” of semi-existent, non-autonomous companies) for promotion into the investor ranks (EIRs or associates or partners at VC firms)”

    That seems like a lot of mind games. I just assume solve real problems for real users and stay at my very modest home.

  4. I generally cut ties with people who make bad decisions

    Boy, are you gonna die without friends if you keep that up. Given your own evidence above, you already wouldn’t have any if your friends had adopted that policy. (I’m not talking about hanging on to people who betray your trust, of course.)

    • That may have been an exaggeration, and I’m not talking about a close friend.

      I find myself getting irritated by people who let themselves be abused, if only because they corrupt the market and make things worse for all of us. It’s one thing to make mistakes. It’s another to willingly sell oneself short and bring the whole market down (not that any specific individual can usually have any such effect, but in principle).

      • I came over to comment on this myself. There is something to be said for maintaining a distance from people who are vexacious or who have a life pattern of getting themselves into bad situations (and not getting out). That said, I think it’s kind of a moral duty to try to give people a nudge out of their rut when I can, and to raise bloody hell when they’re in a bad, bad situation. Anyway, keep up with your writing, which though sometimes dark is inspiring!

  5. Very solid elaboration on the Quora answer!

    I hadn’t known about relocation clawbacks. Good thing to watch out for. Also, I can’t believe that piggybacking flights startup didn’t even have the self respect to let their company die gracefully in the slightest. I wonder if we’ll be seeing more of these sorts of shameful things pop up on places like that Secret app.

    > If you’re a prospective employee and you’re offered an inadequate relocation package, turn the job down….These, “oh yeah, we offer $2000″ fly-by-night startups aren’t serious about winning.

    I definitely agree it’s important to be selective and command respect, but as you probably know, especially in the digital design world, there is a sort of winner-take-all economy in which both talented and talentless designers become ‘rock-star ninjas’ by circumstance of being with the right partners/clients/employers at the right time. Otherwise, it’s difficult to break in regardless of skill.

    As far as I know, there are very talented designers who hadn’t amassed a cult of personality, but went with middling (but respected) employers and over time have gained prominence. So I’m not sure how to weigh that against your advice to just turn those jobs down by default especially at the beginning of one’s career (whether it’s due to lower than desired relocation, or low-mid salary.) No matter where you are in your career, it’s not a good sign to be unemployed for too long.

  6. I would take it a step further: Don’t relocate for a specific job. Pick a location you want to live in and find a job there. This may not apply to places like SF where you can’t throw a rock without hitting 6 potential employers, but it applies to most of the rest of the country. Even with full relo and no clawbacks, they still will have the leverage over you for the first year or so of being your main local social connections as well as the reason you made the move. If you find yourself living in Hunstville, AL for what you thought was a cutting edge rocketry job that turns out to be a bunch of old code maintenance, it’s going to be tough to suck it up and rent a U-Haul again after 1 year.

    • This is one of the main drawbacks of taking a job well away from a major tech center. I am sure it applies to other occupations as well, like advertising copywriter in Duluth. Yes, you have a nice job in Pleasant Smaller Market, but now the job ends, for one reason or another, and there are only two other employers within 50 miles. As you say, time for the U-Haul again.

      A friend of mine got the full corporate relocation, and it probably cost the company $20K or more. Cars shipped by truck, not just professional movers but professional packers, residence hotel at the other end for two months, and probably more. $2000 is really an insult for an adult, since a cross town move of a two bedroom apartment will probably approach that.

      • “A friend of mine got the full corporate relocation, and it probably cost the company $20K or more. Cars shipped by truck, not just professional movers but professional packers, residence hotel at the other end for two months, and probably more.”

        That’s what I’m talking about. That’s what a company does if it actually values you.

  7. Remember, we’re talking about a group of employers in the Silicon Valley that value their prospective employees so little that they’re willing to lie about the literally thousands of qualified resumes they’re sitting on, simply to hire a cheap worker on a H-1B. The offers going out these days are rather insulting. The lack of response to a qualified application is rather insulting. And of course, those relocation packages, when actually offered, are insulting. Maybe if you go into it 20 years ago, when housing prices were reasonable, you’re doing okay. But grads of the last decade, heck, even the last 12-13 years, have done terribly.

    • I agree with you fully. Out of curiosity, what do you say to the people who claim that Valley programmer salaries “are insanely high” right now?

      The problem is that so many people are more screwed than software programmers (who’ve managed to retain upper-working class status) that no one’s going to shed a tear for us, and that’s fine, because we don’t need anyone’s tears. It’s on us to organize and ask for more (or, otherwise, accept declining conditions).

      • There’s a few ways of looking at it. Compared to the number of applications that SV tech firms are receiving for the jobs they advertise, salaries are likely quite high (a typical firm receives several hundred qualified resumes per advertised job) and should clear at a lower point.

        But compared to the societal value that software (and engineering more broadly) brings to the table, and the sort of investment that engineering/software professionals make in their careers and skills, salaries are abysmally low. San Jose police officers, on average, out-earn most SV software engineers.

        I view the problem as a much larger one of the industry failing to capture value for its product, and effectively is forced to squeeze the employees for the shortfall in revenues relative to operating costs. Your characterization of most start-up firms being non-viable entities is apt. The Internet, IT, IP protocol networking, social networks, mobile telephony, etc., have enriched peoples’ lives enormously, yet it seems impossible to get end-users to pay the full life-cycle cost (including a reasonable ROI) of developing, implementing, and delivering such goods and services. Advertising in a post-consumerism world isn’t a viable way of sustaining the business model of the Internet either!

        Oil companies have seen the price of gas go up roughly 5X over the past 15 years. The price of almost everything else we consume has gone up. Yet the public has a huge expectation of progressively lower costs of IT and related goods and services. And we engineers/software/IT professionals have borne the brunt of such. Which is why you are writing these stories of abhorrent behaviour amongst tech firms racing towards the bottom in their labour practices.

        • This makes a lot of sense.

          Our industry (as I discussed in my Damaso Effect essay) tends to have some of the best engineers answering to the worst businessmen: stupid ones who have no vision and are only good at cutting costs. Thus, when we build something cool, the boss men only see it as an excuse to unemploy other people (and take bonuses for themselves). The fact that we are used for this (when we can do so much more) and let it happen also means that when we are turned against each other, we all lose.

          • Basically, software engineers are the new blue-collar workers, and software engineering is the new manufacturing industry.

            The issue of executives and upper-management taking advantage of their workers is an age-old problem, software engineering is not the first, this has been happening since the start of human history.

            And so what is the solution? Certainly not professionalization, since almost any Tom, Dick & Harry can take up the profession of “coding” as soon as they finish watching a YouTube video on how to code, or read one of those “How to Code Java in 24 Hrs”. I guess that leaves you with Unionization, which happens with Blue Collar jobs and Hollywood actors.

    • I take issue with you taking a wide swab at H-1B tech workers. Many of these folks, myself included, are US college graduates ourselves, and we share both the same aspirations and concerns raised among the comments and posts here.

      I myself ensure that whatever compensation package I am offered is in line with the market offer. Those who abuse the H-1B to hire cheap-ass workers are themselves non-US companies such as Infosys and Wipro that have “consulting” offices here in the US.

      To any of my prospective employer, I would actually be even more expensive, since besides demanding a market-rate compensation package, there are these additional costs of immigration, lawyer fees, work permit fees and relocation fees.

      • The mere presence of H-1B’s in the marketplace, even at high-spec tech companies, suppresses compensation across the board. The use of the H-1B suppresses salaries of tech workers, and the fact that firms are willing to use them, rather than consider the qualified applicant pool (often hundreds of qualified individuals per available job) is proof that firms are not interested in treating tech workers professionally.

        Very doubtful that you are more expensive. Lawyer fees, work permit fees, and whatever pittance in relocation you receive are a relatively small trade-off compared to effectively having you beholden to a given employer for even the privilege of being present in the United States.

        • “The mere presence of H-1B’s in the marketplace, even at high-spec tech companies, suppresses compensation across the board.”

          And where is your data to back this?

          The general issue of low salaries across the board is a cultural problem, of software engineers, both American and non-American, being blissfully ignorant that they are underpaid.

          I compare salaries with my American peers, I went to the same top eng schools with them, and I ensure that I am paid equal to what my American co-workers get. I turn down offers from shitty companies offering shitty pay.

          Resorting to xenophobic arguments to explain what is a cultural problem in tech on salaries and employment issues is a loser’s way to go about it.

          • Its not xenophobic to state the fact that when the market is glutted with additional engineers in excess of true market demands, through the H-1B visa program, compensation is going to be suppressed across the board. This is a systemic suppression of compensation. Also, you certainly can’t be claiming that you’re privy to all of the HR records of your employer in making such a broad claim, can you?

            As it stands, most tech firms are receiving a hundred or more qualified resumes for each tech job they post, particularly for software engineers. Yet the H-1B program continues to exist, and employers continue to, on a widespread basis, lie about the availability of tech talent in order to continue the salary suppression. Giving rise to the abhorrent behaviours described in this blog. One of the ‘fixes’ to this problem is simply to send the H-1B’s packing back to India or wherever they came from, and let the labour market fix the glut itself using domestic resources and domestic talent.

            • That’s shortsighted and short-term thinking. The employers are multinational and labor has to unite multinationally too, not submitting to divide-and-conquer tactics on the part of management. Both H1-Bs and American citizens are the victims of these deceits, which must be stopped jointly.

              El pueblo unido jamás será vencido.

              • Thank you.

                Hating “H1-Bs” is just ridiculous. The problem isn’t the people. It’s the way the program is structured, and the fact that employers willfully lie in order to keep it the way it is.

                It’s not that wages are depressed by “foreign workers”. Anyone who is that beholden to an employer (which is not the fault of the people having H1-B visas) is going to have a wage-depressing effect.

                We should, instead, hate the system in which the gains of capitalism are no longer shared but, instead, go entirely to the top.

              • When has labor “united multinationally” ever in all of history. You can’t even get labor to unite within a nation, and diversity only makes that more difficult.

                Divide and conquer strategies work best when there are a ton of natural divisions between those you are trying to divide. Everyone knows that ethnicities favor each other in the workplace, and that groups will sell out other workers to promote themselves and their own kind. Only progressive whites and dumb enough not to play that game, and there is zero reciprocity by other groups in return (because they aren’t that dumb).

                You have zero empirical evidence that just being more progressive about H1-Bs is going to cause the workers of the world to unite. All of the relevant evidence as well as basic economic theory and common sense all point to the opposite.

                Those countries that have maintained monoethnicities still enjoy high wages and high labor rights. The golden age of labor in America was a time of near zero immigration.

                “Hating the system” while supporting its number one most effective way of suppressing labor is just fighting a war the stupidest way you know how. It ensures a 0% likelihood of ever actually beating the system.

                People take the prog position on trade and immigration because it allows them to status signal and posture. They know they are a worthless nobody that can’t change anything, so even though being pro-immigration is absolutely suicidal they do it anyway because supporting it gains one status points while they can’t change the actual policy anyway so you might as well pretend.

  8. One year and half I relocated between two countries of Europe for a new job. The company handled everything: professional movers/packers, temporary relocation and an agency to help us find a new flat and deal with the paper work.

    But the company itself was following Agile/SCRUM religiously, and the job itself turned out to be crap – at least IMHO. After one year and half I couldn’t take it anymore and quit.

    I know this is just an anecdote, but my point is: while a bad relocation package is obviously a bad signal, a good relocation package won’t mean the job will be awesome.

    • No, it doesn’t. At least you lose less if the job turns out to be a stinker.

      So much of the Valley mentality is “this is such a great career move, so you should take the risk of funding your own relo”. It’s a great way to take advantage of clueless 22-year-olds with family money. However, I don’t want to work with 22-year-olds with family money. I want to learn from solid, adult professionals. That means the company needs to treat its people as such.

      It’s a necessary but not sufficient condition.

      • This also happens to 22 year olds without family money. They often are left destitute when the “well funded startup” blows up after a few months.

  9. Ah, but if there’s a clawback, and you quit before the time interval, you can be worse off than with no relocation, because the clawback is paid with AFTER TAX money.

    Suppose you receive $20k relocation allowance with one year clawback. If you repay the $20k, and you’re in a 50% tax bracket, you need to earn $40k to pay the $20k clawback.

    • 1. This is one reason why lump-sum relocations are generally terrible.

      2. I wonder what the collection rate is on relocation clawbacks. I would imagine that it’s high, when the clawback is part of the next company’s package, and low otherwise. It’s relatively easy to bring enough bad publicity on a company that tries to collect, for it not to be worth it. It’s an experiment I’d rather not try, but I would guess that the process of actually collecting on a relocation (excluding the “my next company is covering this, so here you go”) is pretty expensive and damaging, with a low rate of success.

      In other words, I think it’s pretty rare that people actually pay these clawbacks out of pocket. The main effect of it is to make the person less desirable to competing employers for a year or two. Not only is that person more expensive to hire for future employers, but there’s an embarrassing “I took this job, and now I’m leaving early because…” conversation he has to have.

      Clawbacks are a shitty, shitty way to do business. The company’s first foot forward is, “We don’t really trust you, so…”

  10. I’ve got another shady trick my employer pulled on me today.

    Two months after I switched jobs, now they tell me I have 24×7 on-call support responsibilities. Other people were doing it, but they quit. That isn’t fair, because I would have refused the job if I knew about it. Having already switched jobs, I have no leverage now, and it’s too soon for me to move again.

    • You’re better off starting a search now. A 2-month job can be papered-over. 4 to 7 months is the dead zone, because it looks like you failed your first performance review. Represent the job as a contract gig that you completed successfully and that they wanted you to renew, but you chose to move on. Don’t use them for a reference unless you absolutely have to.

      • Yeah, I’m actively looking again. That’s a good idea, representing it as a contract-to-hire where I decided to pass.

        They’re doing a couple other boneheaded things. They have some potentially interesting projects, but they’re hiring outsourcing firms to do all of them. That’s pretty insulting, having outsourcing firms develop new products while full-time employees are doing maintenance programming.

        Plus (as expected), the outsourcing firms deliver hard-to-maintain code. That makes it very difficult for anyone else to successfully maintain, so the outsourcing firms look like geniuses because they’re the only ones who can modify the steaming pile they wrote. So, the outsourcing firms who delivered a lousy product are kept on to do maintenance and do new development, while the full-time employees are working on the leftover projects.

  11. How does a clawback work? Unless you have substantial equity or deferred compensation I don’t see what they can pull. You just tear up the bill. And even if they have “your” equity as collateral I think that’s a legal minefield they’d be very reluctant to step on.

    It turns out a lot of states have “indentured servant” laws that make these sorts of threats toothless. Many employers will have clauses relating to continuing education benefits where they’ll claim you owe the money back if you quit this year. It’s always uncollectable, legally. You can ignore it.

    • They gank your last paycheck and vacation days. Beyond that, I’d imagine that the collection rate, except with the subsequent employer pays, is really low.

      I think it’s more to humiliate the person (“I need out of this contract”) in front of his next employer than to collect the funds.

  12. A relo clawback sounds like psychological projection.

    The employers are sleazy enough to ask interviewees to piggy-back their on-site interview on another company’s dime, and so they are sleazy enough to fear you will piggy-back your relo on their dime.

    It’s hard to believe this ever happened more than a token amount. Sounds like a silly rumor that sleazy and paranoid employers ran away with in their own imaginations.

  13. I also have a relocation horror story (from early in my career). In 1999, I dropped out of a PhD program to take a programmer job, with relocation paid with a clawback. Two weeks later, a merger was announced and all new development was halted. Because of the clawback, I was reluctant to switch. Besides, I wanted to see what would happen. (They probably would not have tried to collect if I left, but I didn’t want to push it, and also I wanted to see how a corporate merger ends.) However, I wound up getting no marketable experience for a year. In 2000, when the merger finally closed, the dot-com bubble had burst and now it was very hard to find a new job.

    Another sleazy trick from the merger was they said “You will get $X retention bonus when the merger closes.” However, the merger close date kept getting pushed back! If $X was a nice bonus if you had to wait 6 months to get it, it wasn’t worth it if you knew it was going to take a year. Now I know, if I’m ever in a merger again, the retention bonus should be tied to a specific calendar date, and not the “close date”, which will always change. If the retention bonus is tied to a vague date, then it’s effectively worth $0.

  14. Pingback: How the Other Half Works: an Adventure in the Low Status of Software Engineers | Michael O. Church

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