Google illegally underpaid thousands of temps in at least 16 nations

Google illegally underpaid thousands of temp workers in at least 16 countries, attempted to cover up the problem and delayed fixing the problem for more than two years, according to reports in the The Guardian and The New York Times.

Despite the fact much of Google’s violations of labor laws took place in the UK, Europe and Asia, a whistleblower filed a complaint related to the allegations with the U.S. Securities and Exchange Commission. Since Alphabet, Google’s parent company, is publicly traded in the U.S., failing to disclose it’s labor law legal peril overseas may constitute material misstatements in its quarterly financial reports, a violation of US securities law.

Intentionally underpaying employers is also known as wage theft.

Represented by Whistleblower Aid, the whistleblower’s SEC complaint states that Google unpaid temp workers by more than $100 million. The SEC has not said if it is investigating the claim.

In a statement reported by the The New York Times, Google chief compliance officer Spyro Karetsos said “It’s clear that this process has not been handled consistent with the high standards to which we hold ourselves as a company…We’re going to figure out what went wrong here, why it happened, and we’re going to make it right.”

Google illegally underpaid

Reporting by The Guardian shows that management has known Google illegally underpaid workers for several years and dithered at length about how to respond. It wasn’t until the story was revealed in the press that Google disclosed the issue.

“The disclosure makes it clear that Google hasn’t just broken labor laws around the world, but has misled investors about major legal and financial liabilities,” said John Tye, founder and chief disclosure officer of Whistleblower Aid. “The lawful, anonymous whistleblower disclosure is a critical step toward ensuring that Google is held to account. We urge the SEC to bring an enforcement action against Google, and protect the rights of investors to receive complete and accurate information.”

The Guardian, Sept. 10, 2021

It’s not the first time that Google has issued a statement saying it would improve its treatment of temp and contract workers.

Following the publication of an April 291 story in the The Guardian about the mistreatment of temps and contractors Google said that it would implement new “minimum standards” for temps and vendors in the United States.

Google said it would will require staffing agencies and suppliers to give US-based employees working at least 33 hours:

• A minimum wage of $15 an hour
• Comprehensive health insurance
• A minimum of eight paid sick days
• 12 weeks of paid parental leave
• $5,000 per year in tuition reimbursement for skills training and higher education

The minimum wage requirement went into effect in January 2020, while the other benefits won’t kick in until January 2022. Even with this tepid response, Google is behind other big tech temp exploiters. Facebook implemented a $15-an-hour minimum wage and 15 days of paid time off for contractors and vendors in May 2015.

“While most of our partner companies do the right thing, we want to hold them and ourselves to a high standard,” said Eileen Naughton, Google’s vice-president for people operations, in a 2019 email announcing the changes to staff that was reported by The Guardian.

The changes were limited to the US, but Naughton wrote in the email the Google would plan to “identify and address areas of potential improvement in other areas of the world.” It took another story two years later to again get Google to issue a statement it would do better “in the future.”

Google relies heavily on temp workers, what it calls it “extended workforce.” The Guardian reports that Google has workforce of approximately 100,000 temps, vendors and contractors, referred to internally as TVCs. These workers include the drivers capturing photos for Google Maps’ Street View, content moderators training YouTube’s filters to catch prohibited material, or scanners flipping pages to upload libraries into Google Books.

A 2019 New York Times story called Google’s then-121,000 temporary workers “a shadow work force that now outnumbers the company’s full-time employees.” In early 2018, Bloomberg reported Google did not employ a majority of its workforce.

This heavy reliance on temps, similar to that of other tech giants like Amazon, creates two tiers of works within the company. One tier is full-time, highly paid. The other, often contracted through staffing firms, are low-wage have no job security. Google went so far as to create a training program that outlined rules for how Google’s full-time employees should treat its temps and contractors differently.

Pay for full-time Google employees has increased substantially in recent year. Median total compensation gained more than 38% — rising from $197,274 to $273,493 — between 2017 and 2020, according to SEC filings. Friction over the treatment of temp workers between Google management and its full-time workforce has spilled over into public view.

After 20,000 workers joined a global walkout on November 1, 2018, Google gave in to one of the protesters’ demands, ending forced arbitration in cases of sexual harassment. But this only applied to full-time Google’s full-time employees.

In December 2018, organizers of the walkout published an anonymous open letter to Google’s CEO, Sundar Pichai, from “TVCs at Google” detailed concerns that TVCs face due to Google’s differential treatment, including lower wages and “minimal benefits”.

In April 2019, more than 900 Google full-time workers signed a letter objecting to the company’s treatment of temps.

During March 2019 Google reportedly abruptly shortened the contract of 34 temp workers on Google Assistant team around the world. For several months before the incident, the company temps and contract workers were “increasingly vocal in protesting both their working conditions and the ethics of their employer,” The Gurdian reported.

“It’s like a white-collar sweatshop,” said one current Google employee. “If it’s not illegal, it’s definitely exploitative. It’s to the point where I don’t use the Google Assistant, because I know how it’s made, and I can’t support it.”

The Guardian, June 25, 2019

Google may have been influenced lax labor laws in the U.S. surrounding temp and contingent work and the nation’s low federal minimum wage. These U.S. laws lag behind those in most of the industrialized world.

And that’s where Google has gotten itself into global trouble.

More than 30 countries have pay parity laws, requiring firms to pay temps the same rate as full-time employees. The UK, the EU member states, India and Taiwan, have enacted “pay parity” or “equal treatment” laws. Google surveyed the rates of comparable full-time roles in Europe, the Middle East, and Africa (EMEA) in 2012 and 2013, and the Asia/Pacific region in 2017, but failed update those rates, The Guardian and The New York Times report.

Many of these countries also have laws limiting how long firms can keep workers on temporary status before making them full-time or letting them go.

These laws generally require equivalent treatment of temps to full-time employees in pay, hours, breaks, vacation, holidays and certain perks. The specifics of pay parity laws vary from country to country. Pay parity is required after a 12-week qualifying period in the UK. Ireland mandates it from the first day of work. Some countries mandate equivalency in benefits and bonuses.

The staffing agency and the hirer are responsible for ensuring equitable treatment. However, it is the hirer’s responsibility to provide the staffing agency with accurate pay rates.

Google illegally underpaid thousands, as its own emails and documents show, but as yet there has been little response from regulators or law enforcement in countries where it violated labor laws.