ARTS & FARCES internet

Reports and court records indicate that Microsoft holds some classes of its workers in the same high regard as its competitors and the Justice Department.

Microsoft is well known in the high technology industry for making a lot of its employees very wealthy virtually overnight. The company generously rewards its employees’ hard work with relatively opulent benefits.

Central to Microsoft’s employee benefits package is its employee stock purchase plan. The employee stock purchase plan was established in 1986 and allows employees to buy Microsoft stock at 85 percent of its market value at certain times of the year, through a payroll deduction program.

For years, most of these benefits—including the employee stock purchase plan—were denied to anyone who, heaven forbid, chose to work at Microsoft and retain some semblance of independence.

For many Microsoft contractors this didn’t pose a problem; they were comfortable working independently, with the company as a client, gladly trading stock options and other employee benefits for a measure of independence. There was, many found, an intangible—but very real—benefit in being able to select the projects one wanted to work on or even being able to take some extra time off between contracts.

For other independent contractors—particularly those who wanted the security of full-time employment with Microsoft—the limited benefits policy proved to be unfair and exploitative. After all, they argued, they were doing the same work as their employee counterparts but were being denied the offer of a full-time job and the same level of benefits, especially access to that lucrative employee stock purchase plan.

A court agreed with the disgruntled independent contractors, holding that Microsoft’s independent contractors were entitled to participate in the company’s employee stock purchase plan. Microsoft appealed the ruling to the Supreme Court, which rejected the appeal in late January 1998.

A variety of trade associations—including the U.S. Chamber of Commerce, the American Electronics Association, the Software Publishers Association, and the Information Technology Association of America—supported Microsoft’s appeal. The lobbyists criticized the appeals court ruling as undermining alternative work arrangements and imposing a “draconian penalty on employers for worker misclassification.”