New York Targets Telecommuters

In a ruling that is breathtaking for its government hubris, the state of New York has ruled that telecommuters in other states have to pay New York income taxes on their entire income - even if they live and spent the vast majority of their time in another sate!

A telecommuter who lives out of state while working by computer for a New York employer must pay New York tax on his full income, the state's highest court ruled Tuesday in a case that could have wide implications in the growing practice.

The Court of Appeals said that computer programmer Thomas Huckaby who lives in Nashville, Tenn., owed New York income tax for his full salary, not just the time he spent working at his employer's New York offices.

New York is famous for pick-pockets, but the politicians in the state are worse.

So what is this guy in Tennessee getting for his New York state income taxes? According to the state of New York, you pay taxes to the state for the privilege of working. Check out this quote from the attorney who prosecuted the case:

"New York provides the job, New York provides the professional opportunity, and New York should be able to tax that income, even if the employee for his own convenience was working outside of New York state"

You got that? The state doesn't owe you a damn thing in return for your taxes. You owe them taxes since it is they who are responsible for you having a job.

New York is going to do its best to run more and more businesses out its state. As the article noted, there has been a 200% increase in the number of telecommuters since 2000. Let's hope that other states avoid this, or that congress passes a law that overturns our runaway judiciary.

Fired Vs. Being "Asked to Resign"

From the mailbag today:

What is the point of asking someone to resign? Is this somehow a "nicer" resolution than firing somebody outright? Do you get to refuse to resign and then they fire you?

What is the point of this little semantical distinction?

Good question. While this is definitely a "nicer" resolution than going in and doing a "You're fired!", there are actually larger issues going on for both sides when a company asks an employee to resign:

For the employee:

Pro:
- Resume - This, for me, is the main reason to accept a forced resignation. To tell your next employer you "resigned" is a lot easier to explain since everyone quits jobs at some point ("I wasn't growing", "I wasn't promoted"). Saying you were "fired" can bring up warning flags that might give your next employer pause ("Was it for cause?","Did you steal?", "Did you harass?")

- Not Burning Bridges - Resigning is actually easier for the company (see below), so you can usually negotiate some intangible benefits versus being fired. For example you can do a "I will resign if you write me a letter of recommendation for my next job". This will, of course, depend on the exact circumstances of the situation and force you to swallow your pride, but you have to look at the big picture.

- Exit Package - If you are just fired, you don't have a lot of say in what severance package, if any, you will get. If you are asked to resign, the company is motivated for some reason to not just fire you, so this usually means you will have some room (not a lot) for negotiating your exit. But you have to consider this in relation to unemployment benefits (see below).

Cons:
- Unemployment Benefits - This is different for each state, so check with a lawyer in your area, but in many states if you resign you waive all rights for unemployment benefits. If you are fired for a reason other than cause, most states will allow you to collect benefits, although getting them after being fired may be a pain. In some cases, the best thing to do is negotiate a "layoff" rather than a "resignation" so you can collect unemployment, which goes back to the "Exit Package" negotiation issue above.

- Legal Rights - If you resign, you pretty much waive all legal rights you may have to sue the company for discrimination or other issues - or at least have a tougher time proving your case in court if the company can waive around a letter of resignation.

For the Company: Pretty much the cons above are obviously the company benefits, plus a few others

Pros:
- Unemployment Benefits - Depending on the state, if a company has unemployment benefits filed against it, their unemployment rates can go up. So if they can get an employee to resign and not file unemployment, there is a monetary benefit.

- No Legal Issues - As noted above, a resignation allows the company to pretty much close the file on you as it is much harder (but not impossible) to be sued if they have a letter of resignation in hand.

- Paperwork - In most states if a company fires someone there has to be a paper trail of why they did it to avoid snooping around by the State, which might take months to compile (some states are easier than others. California is probably the worst). So if you resign they don't have to worry about a paper trail.

- Morale - If they can tell remaining employees you "resigned", it helps morale versus if they have to tell everyone they fired you. Even if the "real" story of a forced resignation makes the rounds, it is still better on morale than an outright firing.

- Easier on Management - Firing people is hard. Very hard. Asking for and getting a letter of resignation is hard, but somehow easier. So this goes back to your "nice" comment.

Cons - I can't think of too many reasons why a company wouldn't want to ask for resignations, except in cases where they can't (mass layoffs which make them hard to manage, union contract issues), in situations where they WANT to make an example of a fired employee as a warning to others, and for those companies that are just clueless, but these circumstances are pretty unique.

To answer your last question, the answer is "yes", if you don't give them a letter of resignation, they can just fire you.

My recommendation is when told of the situation to ask for 24 hours to think it over and then get a local labor attorney to walk you through the pros and cons, specifically of unemployment benefits in your area. However, I think the best course is usually to take the resignation with a negotiated exit and move on.

I'll Be Going to Business Purgatory

When I die, pray for me. I'll be going to Business Purgatory."

- My Boss

My boss was joking about having to constantly bend (and sometimes break) the corporate rules in order to get stuff done. This is a common problem in large corporations, which is why there is a religious-sounding saying in business: "It is better to seek forgiveness than to ask permission."

Those of us on the front line in sales, marketing and program management are trying to meet the needs of customers, close sales and get products off the ground. In large corporations there are large, complicated bureaucracies trying to prevent all these things from happening (okay, not really, but it seems that way). I'll go over a few of them and their modus operandi:

Legal - If you don't do business, you can't be sued - The legal department in large companies can drag a contract out to the point where the product is obsolete by the time it's signed. One time when I working at TI it took 9 months to ink a deal with IBM - so the legal departments on both sides made that negotiation a living hell. The end result is that marketing managers like myself end up doing most of our own contract negotiations, sending the final draft to Legal for review only when it is ready to be signed. I get grief for doing it, but it gets things done faster (as a side note, I have encountered several really good legal people in large corporations who bypass the System whenever possible, so this modus operandi isn't universal) .

HR - We're undereducated automatons on a power trip - My dislike hate loathing of HR organizations is well documented (try my new search bar to find out). I just ignore them at all times, even when I am interviewing. In my present job I basically refused to negotiate with HR and only with the product group, which earned their wrath. More recently I chewed out one of their drones who was trying to tell me to do something that made absolutely no sense, so the hate is mutual.

Purchasing - YOU can't talk to vendors, only WE can talk to vendors - Yeah, like I am going to listen to them. They think their power over vendors somehow translates to the marketing department. I got news for them: marketing makes fun of you behind your back. So you can guess what we think of their rules.

Accounting - Keep your receipts! - Accounting is usually very friendly, and I've liked all the accounting groups I have worked with, but they can a bit of a pain. Like wanting me to keep tabs on every single penny I spend on company business, and then trying to bounce some of my charges. Come on! That $300 bottle of Opus One wine was a legitimate business expense! And hostess clubs are a legitimate form of entertainment in Japan! Okay, I've learned. I'll "hide" that charge on my expense statement as something else.

Finance - Money is Power - Well, they actually have a point there. This is probably one organization whose rules Marketing routinely follows just because there are purse strings attached. But we get around them in other ways: pie-in-the-sky forecasts, inflated revenue projections, underestimating costs. I've seen NPV and IRR numbers fudged beyond belief. In short we'll do just about do anything to get that capital budget, do that acquisition, or anything else that requires large sums of money.

So by continuously breaking the rules, running roughshod over various organizations, and stacking data to meet my end purposes, I can say with some confidence that Business Purgatory is in my future. Or with the way my career is going, maybe I am already living it.

Business Models for Business Units

One of my current job frustrations is how my company structures its various business units (which I will call BU on occasion).

In my company, the business units apply for capital and buy and "own" their own equipment, which are put into various factories. All costs and depreciation for those machines are charged back to the business unit along with all associated labor. Factory overhead is allocated based on volume.






I'll call this the "silo" business model.

The other model is where the factory "owns" all equipment and depreciation, and charges a "cost" back to the BU based on their total costs. Usually the Factory runs at breakeven Profit and Loss (P&L). I'll call this the monolithic model:

From a financial standpoint, the Silo Model makes sense since it makes the BUs bear the real costs of doing business. It shields low margin, high capital BUs from sucking resources away from higher margin, lower capital businesses. The corporation can see - almost like an independent business - the financial return for each BU better than the Monolithic model. (obviously in companies where each BU has unique factories there is no real difference between the two models).

The downside of the Silo Model is that it can create political nightmares between BUs, and create financial incentives for the BU which are detrimental to the Company as a whole. This is why most large manufacturing companies use the Monolithic Model, even though the Silo Model is financially superior. And I am in a situation showing why this is the case.

My BU needs to buy equipment - expensive equipment that costs millions of dollars. Another BU has the SAME equipment sitting idle in the SAME factory. They are not forecasted to be needing it for at least half a year.

The smart financial thing to do (from the Corporation's standpoint) is move the equipment 30 feet from one BU line to the other and spend the millions of dollars on new machinery in six months when it's needed. HOWEVER, the equipment in question is fully depreciated. The other BU doesn't want to give up the depreciated machine and take a new machine in six months since they would then have a piece of equipment that would increase their costs due to a new depreciation schedule.

So I am sitting here looking at a situation where the company has to outlay millions of dollars for one machine while an identical machine sits idle in the same factory for half a year just so the internally calculated "costs" of another BU doesn't go up. Amazing.

Maybe we'll work something out, but to tell you the truth, most managers in the corporation don't care what's "good for the company". They are worried about "what's good for my BU", which is the reason I called it the "Silo" model. Based on my experience in this company compared to another that used Monolithic pricing, I believe the Silo model encourages this type of behavior more.

So if you see me taking the CEO spot at your company, you can bet what model I will be putting into place.

Regulating the Sale of Money

One of the reasons I have no problems tightening up the bankruptcy rules is that I don't think there is a lot the government can do to rein in the problem of people putting themselves into serious debt.

I agree that money lending of all kinds needs to be regulated, and there are additional steps that could be taken, but nothing that exists today or has been proposed will solve the problem of people spending themselves into oblivion. That problem will have to be solved by people taking personal responsibility and being held accountable for their actions, which I think the new bankruptcy bill will encourage. So the fact that none of these proposals is in the bankruptcy bill isn't a reason for me to be against it:

Interest Rate Caps - These exist today and are regulated by the states. Of course what the credit card companies do is move legal operations to the states with the highest cap, which the courts have held is okay. But, still, there is a cap. These caps regulate the credit card companies and others who bother to follow the law, but in several states there are loopholes for the real bottom feeders: rent-to-own places, car loan shops, payday loan stores, etc. This is a state issue, not a federal one, and the Attorneys General of several states have come down on these on a case by case basis, although there is a lot more that can be done in this area (for those guys, I would not have a problem making them darn near illegal, although that would just send their patrons to the loan sharks).

Interest Rate Disclosure - This law exists today and is followed by the credit card, auto loan and other legitimate establishments. The real scumbags mentioned above (rent-to-own, payday loans) are the ones who really abuse this statute, and like the above matter is something several state legislatures have or are looking to regulate better.

Fees - Since interest rates are capped, one of the things the credit card companies have done is jack up late fees, over-the-limit fees, etc. This is a legitimate beef, but I think the government coming into an industry and dictating prices is a very, very bad idea. Besides, consumers can avoid these fees altogether by paying on time (what a concept!) or managing their debt limits (if they can't, then bankruptcy - even the new harder one - is around the corner). Even when I was young and got myself into serious credit card debt, I might have paid a lot of interest, but I have never, ever paid a fee of any kind in the 20 years I have had credit cards.

Limit the Ease of Getting a Credit Card - One of the main complaints about credit cards is how easy they are to get - all those mailers people get all the time. So I assume the solution to this problem is to set a national limit on the ability to get a credit card, limit how many credit cards a person can carry, and the limit the amount of credit a person can get. Problem solved. So the basic premise here is that the government knows what's good for people since they can't figure this out for themselves. This comes under the "people are stupid" form of government, and a lot of people subscribe to it, but I am not one of them.

Disclosure of Payback - Another proposal that has been talked about a lot is putting a statement on credit cards that says "If you pay the minimum amount due, your loan will be paid off in x amount of time and cost you z amount of dollars." I don't have a problem with this, but the people who think it will help are being naively optimistic. The number of people who would send in more money because of this statement would probably amount to a fraction of a fraction of a percent. Go ahead and pass a law on this if this makes people feel better, but it will solve little to nothing of the problems people have with credit card companies today.

I think the only solution to the problem is education, not more laws. Citizens in a capitalistic society have to understand the nature of debt, interest rates and money management. They have to be taught to live within their means and to save for a rainy day. Considering the fact that our public school systems are barely teaching our kids to read, this is a tall order. Like myself, the lesson is usually learned through experience - the toughest teacher - but I think parents and other adults could take a more active role in teaching children personal finance, which is something I certainly plan to do.

Are Asian-Owned Businesses Minority Owned?

It's funny when U.S. political correctness runs amok in other areas of the world. In my case I have a contract clause clearly meant for a U.S. supply agreement that got left in for an Asian supply agreement. Here's the situation:

My company has factories in Asia, and only in Asia: Taiwan, China, Korea (the good part), Philippines, etc.

We occasionally subcontract work when the factory gets overloaded or for certain processes we don't specialize in. These subcontractors are always close to the factory for logistics reasons, so the Taiwan plant subs to Taiwanese subcontractors, the Filipino factory subs to Filipino contractors, and so on. Sometimes these subs may be parts of large multinational conglomerates, but they are always local factories run by locals (usually they are locally owned small businesses since the entrepreneurs in these countries go out and start companies to do the specialty work the multi-nationals don't want to do themselves).

So imagine my surprise when one of my customers sent me a supply agreement that has the following:

Minority/Women/Small Disadvantaged Business Enterprises -Supplier agrees to provide (Customer) with information about Supplier's activity in support of minority business enterprise, women business enterprise or small/disadvantaged business as part of this Agreement. Supplier and (Customer) will jointly establish annual spending goals with these types of suppliers.

I told my legal people to tell my customer's legal people to shove this clause. I'm not going to deal with this crap, and it is totally uncalled for in products that are 100% sourced and assembled in Asia. All our subs are Asian, but we all know that the Taiwanese, Chinese, and Koreans aren't considered "minorities" to the PC people who originally wrote this clause.

But Matches Are Still Okay

Okay, this makes sense

TSA Bans Lighters From Flights
Airline passengers will no longer be allowed to bring cigarette lighters on board commercial airplanes beginning April 14, ending a security loophole that lawmakers said could be exploited by terrorists seeking to light explosives in the cabin.

But the Transportation Security Administration acknowledged yesterday that another loophole remains: Passengers may (still) bring up to four books of matches aboard an aircraft.

The other loophole is that lighters are not banned on overseas originating flights. In fact, most overseas airports sell lighters in their souvenir shops, as I know from my Cheap Lighters of the World Collection.

Some of these things just defy logic. My high-end cigar lighter, a Corona, has a wood exterior finish and probably wouldn't set off most metal detectors.

They Don't Call It "ToKillYa" For Nothing

Another nominee for the Darwin Awards:

Man Dies After Winning Tequila Shot Contest

One person is dead and three are gravely ill following a tequila drinking competition in Santo Domingo, Dominican Republic.

The winner of the contest died. Officials say Ricardo Ivan Garcia — who was 21 — drank more than 50 shots of tequila Sunday night at a disco

Update: Added link to heading

U2 Can Be A Cock(er)

Actually the title should be reversed in order, but it was funnier this way.

First, let me say that as a Child of the 80's, I think U2 is one of the greatest bands of that decade (they were really late 80s and 90s). And "One" is one of their greatest hits - it was even named on of the greatest songs ever.

So imagine my dismay when I heard a remake on the radio. It was horrible. It sounded like it was done by a lounge lizard act at the local Holiday Inn: it was way over the top, the vocals sucked, and the mixing was terrible. And there was some Irish melody going on in the background. It. Was. Awful.

I actually waited until the end of song to find out who it was and it was Joe Cocker.

No one - and I mean no one - could release a song this bad and get radio play. It's only because the damn Boomers have some thing for him that he gets any air play. And what do they know? They also thing think Bob Dylan can sing.

Movie Karate Masters

I finally got around to seeing Kill Bill and Kill Bill Vol 2. Unlike the professional reviewers, I preferred the style and feel of Volume 1 over the character development of Volume 2. However, I thought the Pai Mei character introduced in volume 2 was pretty cool, and that got me thinking about martial arts masters depicted in popular film (I am not going to cover movies that would be listed in the martial arts or kung fu genres since most people have never seen them).

Mr. Miyagi from The Karate Kid is probably the most famous martial arts master in popular film. Who doesn't know wax-on, wax-off? In fact, it was even referenced once in my martial arts class. I was supposed to do a reverse knife-hand middle block. "Huh?", I asked. "Wax-on, Wax off." "Right, got it." I think most people would like to have his style of instruction. He teaches you what you need to know, but sometimes hides exactly why you are doing a specific drill or strengthening technique, adding a little mystique to the experience.


It's probably been two decades since I've seen The Karate Kid, but I do remember the jerk instructor, John Kreese, who coached the kids who were beating up on Daniel. He was teaching his kids to use martial arts aggressively, and was a strict disciplinarian. I think the movie may have hinted that he had a problem with Asians due to experiences in Vietnam (?). Obviously an instructor you would want to avoid, and this negative portrayal of a karate master is the reason Chuck Norris turned down the role in the movie.


Joe Somebody was a pretty bad movie, but I thought the portrayal by James Belushi as Chuck Scarett as an out-of-shape, beer guzzling, washed-out ex-martial arts actor was pretty funny. While he may look like someone you rather drink beer and go bowling with, he still had the martial arts skills to kick your butt, and he makes you learn by shaming you into learning (you think if that fat slob can do it, you certainly can). Interesting technique.


Pai Mei was the instructor of Kill Bill Part 2, but this character shows up as the heavy in quite a few Kung Fu movies (as does the actor who plays him, Gordon Liu). Pai Mei, which means "White Eyebrows", is roughly based on a semi-historical kung fu figure. His teaching technique in Kill Bill is cruel discipline, although it appears he has a soft spot in the end for The Bride by teaching her - and only her...I'm not going to give it away for those who haven't seen it. While learning from him might not be enjoyable, you know you are working with one of the best in the world, so probably a good choice.


Does Yoda belong on this list? You bet he does. The character as developed is really a martial arts master - he teaches his disciples discipline, hard work and compassion, as well as techniques to annihilate their enemies. He could have been in dozens of martial arts films, except he teaches that Force stuff as well. Of course his main martial arts technique is saber fighting. Who you rather learn saber fighting from, Yoda or Pai Mei? Tough one. Almost as hard as the question of which one would you rather have: a Hattori Hanzo katana or a light saber?

Maybe I'm Not So Tough...Yet

I might act tough to businessmen who diss me at icecream parlors, but the fact of the matter is that I just recently got my butt kicked by a housewife in my Tae Kwon Do class.

Martial arts can be broadly classified into two areas: self defense and sport. Of course any technique can be used for either purpose, but some are better than others in each area. For example, Aikido is an excellent self-defense style, but not really suitable for sparring (sport fighting). Tae Kwon Do on the other hand is more a sport than self-defense art, and so well suited for sparring that it is an Olympic sport. Judo, another Olympic sport, is another technique which is more a sport than a defense system (a good wrap-up of the varied martial arts techniques is here).

Since Tae Kwon Do is a sport, if you learn the discipline you will suit up and you will spar. It's mandatory, and you are graded on it for belt advancement. This isn't the case in some martial arts, where people can actually advance quite a ways without going through a full contact fight.

I take class during lunch time. I thought there would be a couple of business guys taking it then as well, but the rest of the students in my class are mostly college students and housewives. All the other business people take the evening class.

For my first sparring bout I got matched with a housewife who was actually quite advanced, just a few belts short of her black belt (purple). She was the only one in class that was my height, and the instructor felt my weight and strength advantage would be a match against her speed and experience.

Wrong. She must have pictured me as her first husband since she came at me like a madwoman. Strength isn't a lot of help in sparring if your opponent is throwing combination kicks you can't keep up with. There was also a mental governor on my kicks since I kept thinking: You're not supposed to hit a woman, even if she's wearing protective padding. So I ended up going probably 75% speed while she held nothing back, doing kiaps (yelling) with each well-placed kick to my head or torso. The result wasn't pretty.

(As a side note, Tae Kwon Do matches are probably 90% kicking. Kicks landed to the head and torso are scored as "points". Punches to the torso are "points" but punches to the head get you a negative point. Since a kick to the torso has a much greater reach than a punch, matches are practically kickboxing tournaments. Grabbing, grappling, throws, and other fighting techniques are not allowed during a match, although we do learn these techniques for self defense purposes during class).

There was no question who won the match. The variety and combination of kicks that come with a year and a half of experience at purple belt are much greater than a lowly yellow belt who has an arsenal of five basic kicks (she knows I am not going to be throwing a spinning hook kick, so doesn't have to defend against it).

I will say that while I might have housewives beating me up, I have lost over 10 lbs. since I started taking the class four months ago, which is the whole reason I started doing this. A few rounds with an intense housewife is certainly preferable to giving up carbs and beer.

Hmmmmm....Free Icecream from Yahoo

It's Yahoo's 10th anniversary, and in celebration, all registered Yahoo users (i.e. if you have a Yahoo mail account) can print a coupon for a free scoop of Basken Robins icecream here.

They also have a "retro" page showing you what Yahoo looked like a decade ago. Have we come a long way or what?