To work or keep looking - What are you worth?
January 26, 2010 5:17 AM   Subscribe

Human Resources Filter: Seems fishy to me but is it legal?

I've been working under the table for a small company in Massachusetts as a trial for 2 weeks. Currently they are working on a package to present to me which I should get today. First I was told that they pay 100% of health insurance, but then I was told that when the 90 waiting period kicked in, after I was on the books, they were going to take $7 an hour out of my pay for this health insurance, so in essence they are charging me the full amount. I get that they are doing this to lower their payroll taxes but it just doesn't sit right with me, what do you think?
posted by jrc to Work & Money (13 answers total) 1 user marked this as a favorite
A company paying you "under the table" as a "trial" is already fishy.

I mean, what do you expect here?

At least you only have two weeks invested. Some employees go years on unwritten, unenforceable vague promises. If you have another option, cut your losses and jump.

If you don't, start a habit of getting everything in writing. When someone tells you something about your job or your future, ask them to e-mail that to you.
posted by rokusan at 5:25 AM on January 26, 2010

$7 an HOUR? If you're working full time that will be nearly $1200/mo! (i.e., yeah, that seems a tad off to me...)
posted by alaijmw at 5:54 AM on January 26, 2010 [4 favorites]

posted by kestrel251 at 5:57 AM on January 26, 2010

7$ an hour is rediculous. Are you sure it's not 7$ a week or every paycycle? 7$ an hour is not worth it unlesss you are making great money (at my salary, 7$ an hour would be just about half or it...)
posted by WeekendJen at 6:35 AM on January 26, 2010

When you say "under the table" do you mean - "off the books, no taxes" or "contractor, no insurance"? Generally people mean no taxes, but just to be sure I wanted to ask.

Companies that hire full time staff to work "off the books" are dodgy. You are not casual labor. Even if you were a "one time" worker there are still taxes.

So yeah, the company is less than honorable with their taxes (and yours!). They are likely to be less than honorable with how they deal with their employees wages and benefits.
posted by 26.2 at 7:07 AM on January 26, 2010

A friend of mine got scewed because of something like this.


if they won't give you a complete job description and a written summary of benefits, pay etc, and keep putting you off ("oh, we'll get that to you after you start") then this is NOT a company you want to work for.

i know the economy sucks right now, but don't screw yourself.
posted by sio42 at 7:10 AM on January 26, 2010

This is a company that does not care about what is legal. They would be subject to significant penalties for evading taxes by paying you under the table. They don't care. So my prediction is that they will care even less about any other infringement of your rights as an employee or their responsibilities as an employer.

I know a job is a job, but I would start looking for another one if I were in your situation.
posted by grouse at 7:10 AM on January 26, 2010 [1 favorite]

sorry - i meant to say, yeah it sounds fishy.
the whole get-it-in-writing thing is a litmus test for fishiness.

don't let them equivocate.
posted by sio42 at 7:11 AM on January 26, 2010

$7 an HOUR? If you're working full time that will be nearly $1200/mo!

While that does sound huge, it's actually not out-of-line for what a lot of employer-provided policies actually cost. Consider that most employer policies include a lot of things that private policies don't vision and dental. When you also consider that a private policy (sans vision and dental) can easily run a family upwards of $800-900/month or more, and carry substantially larger deductibles and co-pays than do employer-based policies, $1,200/month seems to right in-line for a full-featured policy.

That said, it does, indeed, suck that they promised one thing and it now looks like they are offering something else.
posted by Thorzdad at 7:12 AM on January 26, 2010

"that will be nearly $1200/mo!"

My husband's employer-provided policy costs somewhat over $18,000/year in premiums, which works out to $1500+/month. We pay about 1/2 of that, but the top management pays nearly their full premiums. (And the lowest-level employees pay about 1/3.)

(And that's just health. Dental is separate and they don't do vision.)
posted by Eyebrows McGee at 7:26 AM on January 26, 2010

Agree: get it in writing. Get it all in writing. Keep copies, make them keep copies.

And yes, $1200 a month is not at all unexpected for health insurance costs. My dad is on a private policy and it is nearly $1000, and that's with high deductibles and bad prescription coverage. And that's about what my company pays per person for healthcare- millions and millions of dollars a year for a few hundred employees.

What's fishy is that it is per hour, rather than per paycheck.

This is why people are screaming about healthcare costs.

(And the ones who wonder what the big deal with healthcare reform is all about are the ones who have employer or government or union provided coverage and think healthcare insurance costs the $21.75 a week that their share is.

Here is the thing, however: healthcare "insurance" isn't really insurance. Everyone is in a pool, or group, of customers. The insurance company takes what it costs to pay for everyone's bills adds their take and splits it up between everyone according to their "risk". Your company might be in a pool with other similar companies. Or in the case of larger companies, they are their own pool. What it amounts to is that the insurance company is more like a protection racket: they stiffarm the doctors to accept lower payments, deal with all the billing, and you just pay them what they ask.

So, this company might be in a particularly costly group. You might try and see if it is cheaper to get your own private policy, however, and negotiate a higher rate of pay. A company like this sounds flaky anyway, and it might be beneficial for a variety of reasons to keep your insurance separate. It did me tremendous good when I worked for a similarly flaky company and needed to jump ship asap. I didn't have to worry about gap coverage or COBRA or anything like that. For what its worth, the guy I worked for played the same game with me- "oh, everything is completely paid for" and then when the time came, it was "we'll add $25 a month to your pay and you can get your own insurance." I stood my ground and got it to the $100.

(Lowering their payroll taxes probably isn't an issue. They don't pay taxes on healthcare either way. Whether it is on your check or not, it is on their books as compensation. Or they aren't doing it right.)
posted by gjc at 8:26 AM on January 26, 2010 [2 favorites]

As said above, you don't want to work for this company.

Use it as income while you look for a legit operation, but do NOT expect them to tell the truth to you. They lie to the government, they will lie to you.
posted by HuronBob at 5:20 PM on January 26, 2010

I interviewed for a job where I would have been expected to pay 100% of my health insurance and it was $2 an hour for a single person.
posted by bda1972 at 9:54 PM on January 26, 2010

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