There are people changes taking place within Spirit Aero which have yet to reach the industry media. That is likely to change rapidly over the next few days. Follow this interesting email exchange…
Sent: Thursday, May 14, 2009 9:19 AM
To:
Subject: ZeroChaos Conversion Information
Spirit is moving all contractor labor under ZeroChaos. They will no longer be using Volt or PDS.
Regards,
Sent: Thursday, May 14, 2009 10:22 AM
To: @zerochaos.com
Subject: RE: ZeroChaos Conversion Information
You said we will get paid for the hours we work…we will get overtime pay right?
Sent: Thursday, May 14, 2009 9:44 AM
To: @zerochaos.com
Subject: RE: ZeroChaos Conversion Information
Are you planning on getting rid of PDS and Volt also and if not why could we not transfer to one of them?
Sent: Wednesday, May 13, 2009 5:08 PM
To: undisclosed-recipients
Subject: ZeroChaos Conversion Information
Importance: High
Welcome to ZeroChaos!
Please read this email in its entirety. ZeroChaos will become your W-2 employer of record while on this project. Any hours worked will be paid out by ZeroChaos and you will receive a W2 at the end of the year from us.
If I haven't already, I will be reaching out to you individually within the next couple of days to personally introduce myself, confirm information and field your concerns directly. However I wanted to provide you with the answers to the majority questions I have received thus far.
Can I choose another payrolling vendor? ZeroChaos has been named the primary payroll vendor for Spirit Aerospace. Effective June 5th 2009 all contractors whose employer will not be invited to participate in the MSP Program will be moved over to ZeroChaos for payroll.
Will I have vacation, holiday and sick pay?– ZeroChaos does not reimburse for any holiday, vacation or sick pay unless approved by the client. At this time Spirit has made the business decision not to allow for these items.
Will my pay rate stay the same or be adjusted? Your base pay rate will remain the same. No adjustments will be made.
Will I receive my per diem (if applicable)? — Per diems will only be allowed at a rate of $110 per week for the first year of service. Therefore if the start date on your project occurred prior to 5/13/08 you are ineligible for per diem moving forward.
To confirm your current pay rate for this conversion please fax your latest pay stub to my attention via 407-219-3191. Feel free to mask all information with the exception of your name, hours worked, per diem (if applicable) and gross pay.
By the beginning of next week, you will have received the Registration email. In that email your user name and password is provided with instructions to complete your on-line enrollment. You need to complete your on-line enrollment and then download your enrollment documents (W-4 form, I-9 form, direct deposit form, member agreement, etc) and fax the signature pages along with copies of ID's to (800) 675-8189. Once we receive the fax we will let you know via email if we are missing anything.
Please note that the Background and Drug screenings have been waived for this conversion, therefore you will not be required to sign and return those documents.
If you have any questions about the enrollment process, please call me at 877-937-6242, Ext. xxxx
Please check your email daily during this Enrollment Process, so you don’t miss any updates from us.
Upon successful completion of your enrollment, you will receive a final email from me regarding timesheet entry and payroll procedures. You will continue to submit timesheets weekly through CATS and will be paid weekly. You will be paid for every hour worked. There are no paid vacations or holidays for this contract assignment.
If you have any further questions or concerns feel free to reach out to me directly.
Best Regards,
Sent: Friday, May 15, 2009 7:13 AM
To:
Subject: ZeroChaos Conversion Information
Importance: High
Attention all Spirit contractors:
We are sorry that due to Economic circumstances, we have to layoff 300 Contractors effective immediately.
It appears that Spirit has elected to roll ALL engineering contractors into a new "company" shop called ZeroChaos on June 5, 2009.
They will be your new employer and you will work under their new terms (or not).
I believe the main change is that Chaos will not pay for vacation days, sick days, or holidays. This amounts to a reduction of 18 days of pay (if you stay a fill year to receive the 1 week of vacation pay).
Fortunately, Chaos states that the overtime pay will remain at 1.5 times the base rate, and the base rates will not change. It is still unclear if they will retain a "per diem" income split to reduce your taxes.
The per diem period remains the same, and terminates after 1 year of employment. Please see the following emails for more information. Welcome to the new world of Zero Choice.
Regards,
Sent: Friday, May 15, 2009 2:04 PM
Subject: Class Action Lawsuit against ZeroChaos Conversion Information
DON'T JOIN THIS or LET IT HAPPEN…IT WILL CHANGE OUR ENGINEERING COMMUNITY FOREVER!!!!!!!!!!!!!!
SEND THIS TO EVERY CONTRACT ENGINEER YOU KNOW…
Gino has been informed that PDS contractors have access to an employee benefit called "The Pre-Paid Legal Family Life Events Legal Plan" and are being encouraged to use this benefit to form a class action lawsuit against Spirit Aerosystems and ZeroKaos. All contractors with other shops are being encouraged to join the plan and to notify their provider firm they wish to participate in the class. Spirit Tulsa is now 100% ZeroKaos. Spirit Wichita has just begun the transition (though Wyatt is not on the initial list of shops being cut – simply mentioning the class action got me layed off the very next day)
Incidentally, ZeroChaos has a mandate to keep contractors for no more than 180 days – they are to place those contractors into direct positions by the end of that period. Spirit is the guinea pig for this process – Boeing will be next! (Sure feel sorry for those contractors without a plan B
)(If this info was important to you don't forget I paid a rather high price for it – placements ARE still appreciated, but of course only if the rush gets to be too much for just one associate to handle!!)
Sent: Tuesday, May 19, 2009 12:46 PM
To:
Subject: RE: ZeroChaos Conversion Information
Low margin shop under bid the existing two shops in contract renewals. The low bid shop passes some of the cost on to the jobbers by not paying anniversary date (5 days pay) and holidays (6 days). The Chaos shop is trying to get market dominance by under cutting their profits some. Tulsa is history anyway. There is no work left that Wichita can’t handle.
http://orlando.bizjournals.com/orlando/stories/2007/05/28/smallb1.html?b=1180324800^1467437
http://dayton.bizjournals.com/orlando/stories/2008/06/16/daily36.html?jst=b_ln_hl
Looking at this from the shop’s perspective as owner:
Assume: designer gets $60 per hour, shop gets a mark-up of 20% on 40 hours worked.
$60*40(hours)*50(weeks)*.2=$24,000(shop’s sales revenue per designer)
Some of the costs to produce revenue is vacation and holiday pay: $60*11(days)*8(hours)=$5,280 another is employer’s payroll expense ( .062*$104,000=$6,448 employer’s FICA cost, .0145*52(weeks)*40(hours)*$60=$1,810, state unemployment $24,000*.025=$625, federal unemployment $120
Lets see in summation the profit after payroll costs: $24,000-5,280-6,448-1,810-625-120=$9,717
If you include overhead like rent and representative, the owner may get $2,400.
They need to have working capital of ½ years pay for all their jobbers. The working capital has an opportunity cost on the time value of money too. It is even worse with interest charges on a line of credit.
So Chaos under bid $5,280 per employee which is like taking .156 times the rate of $60 per hour on 40 hours worked as an exclusive contract. The usual shop rate is .20 times your rate on 40 hours worked
Sent: Tuesday, May 19, 2009 1:00 PM
To:
Subject: FW: ZeroChaos Conversion Information
Spirit is changing the game and it doesn't sound good.
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