More than Just a Job… Just Might be a SCAM!
I was speaking with a company in San Diego that was looking for a Human Capital Manager to run all of their Recruiting. They use the term Human Capital instead of Recruiting or Talent Acquisition because they wanted to make a distinction between Human Capital and Human Resources. Well it became obvious the reason why the distinction after a few minutes into the interview. A person who has any human resources sense wouldn’t take the position.
They’re a small company 35, used to be over 200 however due to recent economic (also legal) incidents they have significantly downsized. In short the CEO was sued for assaulting, wrongfully imprisoning, and battering a former employee, as well as sued by two of his largest accounts for breach of agreements as well as law.
The VP of HR was explaining to me their compensation package and the fluidity of that. As a small company they don’t quite have the overhead or reserve needed to stabilize it. I can understand the need for fluidity with a small company of 35. He went on to say how the fluidity worked, if the company made $35K above goals for that week, everyone would receive a $1K bonus. So the janitor and the Jr. Programmers would be happy because that’s a great increase (right?). Likewise the situation was often reversed if they went under goals everyone would take a deduction that week. So the janitor and the Jr. Programmers wouldn’t make anything that week.
I asked him when was the last time that they had a surplus and he told me about one year they were $1mil above goals and they spread loaded that to all 200 employees. That’s a nice $20K bonus for the year. However he mentioned that since the beginning of last year they haven’t quite been hitting their goals consistently. He said that he constantly take a $1K hit a week.
Now he said that dumbest thing that he could have, he bragged about how he and the CEO were able to get people to work for him for FREE! That’s not something that you want to brag about to a perspective employee. He went on to say that they spread load the fluctuations on amount not on salary, so a ton of Jr. Programmers would be working for NOTHING while the CEO and the VPs are still taking 2-3K a week home. That’s when I realized that this was really a scam.
I didn’t confront the guy about his flawed system (obviously he’s a Kool-Aid drinker) of compensation. He went on to say that they overcome the lack of revenue upfront by giving employees Stock Options. Basically every week that they short you, you get $2 of stock options for every $1 shorted. That sounds good until you realize that this is a private company and there aren’t any real stock options. If you are terminated or quit before the company is taken public, you loose all your stock options.
What is worse is that last year when the company went from 200 to 35 employees they also dissolved the old company and created a whole new one. This dissolved all the stock options that everyone had accumulated over the last 5-years. Now the CEO/Owner has a rap sheet that is 45 pages long (seriously I found it photocopied online) and I have no doubt that he will fire every single person working for him the day before he takes it public, sell all of it, and then flee the country. He’s about a crooked as it gets.
So the VP of HR ended up inviting me to a Group Style Interview. I’m all for Group Style Interviews they save time, etc. etc. However I told the guy to email me because I didn’t have time to write down the time and address because I was investing all my funds into a Madolf approved stocks.
The moral of the story is that most companies that try to defer payment for services are scams, for (1) it’s illegal, and (2) if you do research you’ll almost always see a lot of unethical practices by them.
Oh and for those of you wondering, I’m still employed, I’m just keeping my options open.
Tags: Career, Careers, Company, Contractor, Corporation, Employee, Employer, Employment, Job, Jobs, Management, Money, Review, San Diego, Scam, Success, Workforce Management, Workplace
