Friday, November 7, 2008

Just When You Thought Corporations Couldn’t Get More Evil

JPMorganChase has made much press this year. In addition to being one of the sole global financial institutions that almost completely sidestepped the sub-prime mortgage crisis, it also, at the government’s behest, merged with Bear Stearns as they were going under, many months before Fannie Mae, Freddie Mac, Lehman Brothers, and AIG tanked and before Wachovia and Merrill Lynch began publicly waffling. In fact, JPMC did so with such vitesse and expertise, they had plenty of spanking room left over to proceed with the long rumored take-over of Washington Mutual just months after buying Bear. Unlike other organizations, JPMC offers those who’ve lost their jobs pursuant to mergers an astounding barrage of high-end, professional services to help them get resituated in new jobs elsewhere. How sweet. Also unlike other organizations, their no-holds-barred CEO, J. Dimon, has been plastered all over Business Week, The Wall Street Journal, and Fortune for months on end if for no other reason than speculation as to what move he’ll make next.

In this light, JPMorganChase certainly seems like a cowboy in a white hat, a good guy amidst disappointing failures all around. And, for the most part, the press reflects that. But let’s call a spayed duck a spayed duck. JPMorganChase is no stranger to the very greed, questionable behavior, and ruthless decisions exhibited by all the other corporate banking giants. They were just strategically lucky this time. It was not so many years ago that in a public address to his employees upon newly accepting the head honcho position, J. Dimon referred to all of HR, for example, as a “bunch of maggots and cockroaches.” His attitude seems to have changed little since and as a mouthpiece for his organization, it should be noted that this style of communication is an underpinning of bank practices at large.

Kudos to JPMorganChase for giving so much to charity over so many years. Cheers to them for sponsoring so many of our well-known and widely enjoyed sporting events and competitions. Yep, give them points for having more ATMs than Canada has snowflakes. Do these things really offset twisted business ethic?

Offset might be the wrong word. Actually the good they do rather seems to bury or adequately hide many of the nastier goings-on. For instance, as of November 2008, JPMorganChase has implemented a new, mandatory invoicing procedure for all external service providers. No hitch there. Service providers are now to invoice through an online system only. No hitch there. All such providers will be required to do this regardless of the service type provided. So, the company that restocks the water coolers is thrown into the same boat with the shoe shine guy and the $1000 an hour commodities consultant. Perhaps no real hitch there other than the regular corporate tendency to make sweeping decisions without so much as a humane wink toward the macro or the micro. Yet, in true corporate fashion, JPMC has tagged on a new and creative slap to the face that has certain service providers wondering if it is just a big, fat joke. If you wish to be paid on your invoice on time, JPMorganChase will now charge you 4% of the money you earned. You heard it! Buy your money! If you get paid in any way from JPMC and are not a direct employee of the bank, you now must pay a fee to get your money in fewer than 60 days. Some might say, “Well, 60 days, 8 weeks, that’s not really a concern to most service providers.” Some might be lucky to get paid that “quickly.” Well, I think I need not mention what that does to Mom and Pop shops, especially straddled over the fiscal year’s end. But this hardship isn’t relegated to only the small businesses around town.

Consider, for the moment, that at any given time, JPMC has a strong percentage of people working in their offices, every day, who are not direct employees of the bank. The supposed global authority in fiscal prudence didn’t want to take them on at a decent wage or pay their benefits. So, though full-time workers for the bank, they aren’t actually employees. They are temps and contractors and consultants and associates and interns of every type and level. We are not talking about the schmuck who delivers the bagels in the morning or the window washer with the peg leg. We are also not talking about an elitist jet-set or a self-proclaimed mogul salon. We are talking about a set of workers, doing the bank’s work, who show up every day, for a full day, sometimes more, with no overtime in certain cases, no job security from one day to the next, no corporate earned recognition for their deeds, but whose only difference between themselves and an employee is the lacked label, “employee.” They live from week to week, sometimes hand-to-mouth, and depending upon their situation, may already be waiting a four week lag time between hours worked and the specific check used as recompense for those hours.

By JPMC switching to the 60 day standard, pseudo-employees in this title-less cage have but two choices. Pay good money to get their due pay in a normal amount of time or wait double the time they might already be waiting. Why is either significant? Well, to pay money to get your money is a matter of poor principal, poor business ethic; so much so it would be illegal to inflict this very practice upon regular employees. It reads kickback. If you think paying ATM fees is a killjoy, at least ATM fees provide you with a choice. Imagine, instead, if your employer forced you to give her/him 4% of every paycheck before receiving your check every week. Freakin’ Ebenezer Scrooge wouldn’t even do that.

As for the doubled wait time, a wait period that’s already been doubled from the standard 90’s Chase practice of a two week wait, the negative impact is a little trickier. When one considers the fact that these folks already waited an entire payless month at the outset of their being brought on to JPMC, the existing four week lag time, it makes another month wait seem devilishly inappropriate. Yes, they will get paid eventually, but for at least a few, that’s going to constitute two full months without physical pay in a given calendar year. I don’t know about you, but that’s pretty hard to withstand for a lot of folks. Honestly, what would your opinion be about people asked to work full-time for a year and get paid, at the outset, for ten months of that work?

Secondly, given that the notification went out to certain folks in this group during their unpaid vacations, notification warning with less than two weeks prep-time, well that’s then a ten week wait without pay for some. Again, this “some” is people who show up and work every single day.

Thirdly, lump onto the above the sometimes two week processing span it takes to register a person in the new online system, and you can be talking about an up to twelve week wait without pay. Work done on October 1st for instance, wouldn’t be paid until the following year. Yes, once the lag time has abated, such workers will get a check every week thereafter, steadily. Yet note how few people in the world actually get paid every OTHER month or every THIRD month. It usually doesn’t happen because that is not how bills and rents and mortgages are set up. Monthly is usually the least palatable tier of payment possibilities. Even at that rarity, such a paycheck would be for a whole month of work, a larger check. This potential eight to twelve week wait only starts payments again with a check for a single week’s work. Ugh! JPMC should not be allowed to get away with this based on the idea that it is only a single lengthy wait and not a regularity. Face it folks, it is no mistake that a brand new 4 to 8 to 12 week lag time goes live in November, just in time to be penniless for the holidays! Nice move JPMC. I guess if you wish to feed your children on Christmas, you have to give 4% to the Grinch who stole WaMu.


bullet said...

You forgot to point out that they can't even be challenged on the legality of this now that they are the richest guy in the neighborhood.

Beyond that, though, it seems like a strictly CYA policy. Doesn't make it right, but I wouldn't think it's intended to screw people. I wouldn't be surprised if the wait wasn't nearly that long.

Pockets said...

Update 12/06/2008, new invoicing procedure mysteriously put on hold as anonymous Zoomerang surveys reach all JPMC service providers with a JPMC email address. Could the people possibly get heard?