Re: [Discuss] Mass. outlawed independent contractors in software and other creative professions in 2004

2013-08-06 Thread Tom Metro
MBR wrote:
 http://www.wbur.org/2010/06/30/independent-contractor-law.

 A 2004 change to Mass. law that software temp agencies have only
 recently discovered, makes it effectively impossible for programmers and
 people in other professions who create intellectual property to operate
 as independent contractors.

Has here anyone lost a contract because of this? (Specifically, the 2004
provisions. The article cites a case or two.)

As pointed out in the article, this was a worsening of a law that dates
back to the early 90's. In the 90's I did run across business that would
only hire through agencies.

The worse part is that most independent contracts are probably not even
aware that companies are steering clear of them because of this and the
related federal rules. It trains businesses to either 1. hire W2
employees, or 2. a contractor through an agency. So they never even go
looking for a contractor outside that universe.


 The 2004 law was passed because construction workers and other unionized
 workers were finding that employers were forcing them to set up phony
 independent contractor status so the employer could get out of providing
 benefits.

The article depicts the union leader as being pretty obstinate and
indifferent to the damage the law does to other industries.

There seems to be some details missing from the scenario where a
contract drywaller willingly accepts a contract rate that doesn't cover
the cost of benefits that he would get as an employee. If you know
employees are getting $25/hour plus $20/hour in benefits, insurance, and
employment taxes, why would you accept less than $45/hour? If you're
desperate for a job, then you'd be just as apt to work W2 for a
sub-standard wage, and the employer could save money that way.

If the union sets the minimum wage for W2 and not 1099, then that seems
to be a far easier problem for the union to fix than changing a law that
impacts every industry.

If its about an employer saving the cost of worker's comp insurance,
then mandate that the 1099 contractor show proof of insurance to the
employer, and hold the employer accountable for hiring only contractors
with insurance. (Much like proof of citizenship is required for employment.)


 ...if you're forced to be a W-2 employee rather than an independent
 contractor, you lose any right to anything you create.
 ...
 And that means they can no longer own what they create.

I didn't follow this argument.

Yes, in the absence of contracts, a 1099 vendor can retain ownership in
goods they supply, and a W2 employee falls under the work for hire
provision of copyright law, so the employer retains the IP.

But that describes an unrealistic scenario. A contractor - as the name
implies - works under a contract, and that contract inevitably includes
a clause saying the client retains the IP, unless they've specifically
negotiated to retain it. And more importantly, I'm not aware of any law
that prohibits an W2 employment contract from granting IP rights to the
employee.

So either this argument is a disingenuous red herring, or I'm missing
something.

 -Tom

-- 
Tom Metro
Venture Logic, Newton, MA, USA
Enterprise solutions through open source.
Professional Profile: http://tmetro.venturelogic.com/
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Re: [Discuss] Mass. outlawed independent contractors in software and other creative professions in 2004

2013-07-31 Thread Jim Gasek
Mark:

Yes, the below is IMHO correct, but the issue is much bigger than
that.  For example, Workers Comp.  The government was aware of the
fact that it was difficult to tell who was covering workers 
comp, and they hated that.  So, they made the end customer
(deepest pockets) responsible for ensuring somebody was. 
Just one small administrative law example.   

Government wants the masses to think that all forms or labor, all
structures of entities through which people can bill are tax
neutral.  I.e., it doesn't matter how you structure it, the
same amount of tax is owed, regardless.

Trusts, corporations, LLCs, aka persons; individuals, 
all have very specific meaning in law.  Law is all about 
specific meaning.  

Tax neutrality is a fairy tale that insatiable government 
hopes everyone believes.  

Mechanically, more complex structures make the tax agencies 
work harder to pin the tail on the donkey.  Legally, less
conventional structures highlight (let's call them) Liability
holes in jurisdiction.  I've been blessed to be a witness
to many of the legal battles in this and related areas.  

This is a blog about *nix and computer contracting, so I
won't continue down the above train of logic (although I know 
that many on this list know the real story), suffice it to 
say that all these actions by the government are aimed at 
maximizing tax revenue.  It has nothing to do with fairness.  
If computer workers wanted fairness, they would need to hire 
people to lobby and play the same games (in representative 
government) that the unions play.  

I'm not a lawyer giving legal advice, or an accountant
giving tax advice.  To do so would be technically illegal 
(nice, huh?).

To give advice in these areas is regulated by government,
just as doctors are regulated in giving a medical prognosis.  

What I would advise is NOT always to believe the so-called
experts, and conventional wisdom, and do the research 
yourself regarding these very well researched areas.  

It all begins in Philadelphia in 1776.  It is quite a story.
You have to start at the beginning for it to make sense.

Some things have changed in 225 years, but many technically
remain the same, at least in theory.   Unfortunately, the 
courts have been assigned the role of umpire, and have not
been doing their check and balance thing very well.  

Thanks,
Jim Gasek

--- m...@arlsoft.com wrote:

From: MBR m...@arlsoft.com
To: Edward Ned Harvey (blu) b...@nedharvey.com
Cc: Joseph Guarino jguar...@evolutionaryit.com,   discuss@blu.org 
discuss@blu.org
Subject: [Discuss] Mass. outlawed independent contractors in software and other 
creative professions in 2004
Date: Tue, 30 Jul 2013 23:46:56 -0400

The cracking down on companies using contractors instead of employees is 
another case of state legislators discriminating against software 
developers and other professions that create intellectual property.

People who create intellectual property often want to be independent 
contractors.  Among other things, if you're forced to be a W-2 employee 
rather than an independent contractor, you lose any right to anything 
you create.  It's fairly common for a programmer to do similar projects 
for clients, and over time to factor out the commonalities in the code 
he creates for each one and assemble a collection of his code that he 
can customize for subsequent clients.

A 2004 change to Mass. law that software temp agencies have only 
recently discovered, makes it effectively impossible for programmers and 
people in other professions who create intellectual property to operate 
as independent contractors.  And that means they can no longer own what 
they create.

The 2004 law was passed because construction workers and other unionized 
workers were finding that employers were forcing them to set up phony 
independent contractor status so the employer could get out of providing 
benefits.  And since union leaders and politicians are often 
buddy-buddy, the Mass. legislature passed an overbroad law to help out 
their union cronies without giving a damn about the havoc they'd be 
causing to software engineers, even though software is one of the 
biggest parts of the state's economy.  It took several years before the 
law actually filtered down to clients, but now I'm hearing that nobody 
in the country will hire an independent software contractor from 
Massachusetts.  Same goes for writers, artists, etc.  See 
http://www.wbur.org/2010/06/30/independent-contractor-law.

Mark Rosenthal
m...@arlsoft.com mailto:m...@arlsoft.com


On 7/30/2013 4:50 PM, Edward Ned Harvey (blu) wrote:
 From: discuss-bounces+blu=nedharvey@blu.org [mailto:discuss-
 bounces+blu=nedharvey@blu.org] On Behalf Of Joseph Guarino

 What were they thinking?  As a political independent I'm not opposed to
 taxation but I am opposed to them being unfairly levied against
 industries we should be trying to encourage to stay in the state.
 It's a use tax.  Amazon and rackspace