[foundation-board] Fwd: really and truly version of report

[Tom Cobbold]

Hi Rufus -

My only objection (from recollection of Mr Lipson's report) was the notion of a Financial Controller reporting to the HoO. I solemnly believe that role should be adjunctive to none other than the ED.

KR,
Tom

Tom Cobbold FCCA
07968 324935

> On 27 Nov 2014, at 12:53, Rufus Pollock <rufus.pollock at okfn.org> wrote:
> 
> Dear Board,
> 
> I have worked with Morris to produce some small but significant revisions to his report with the plan of putting this online publicly (something that Martin at Omidyar has been very keen on). Overall I am also keen for this to happen, but given the content of the report this is something that the Board also needs to approve (esp if any liability questions).
> 
> Apart from for a change around our history at the very start, the main change is in the section about consultants and employees.
> 
> I have attached both final version (PDF) and a track changes doc that illustrate the main changes (though it does not show deletions very clearly, at least not for me).
> 
> In addition, I have inlined below the section regarding contractors and employees which was the foci of changes (note the text below will not show the track changes).
> 
> Rufus
> 
> 3. A problem in relation to consultant and employee status
> 
> For most of its existence, OK “staff” have been on consultant contracts, tied to project work. The reason for this treatment was clear and fair enough at an earlier stage: projects came in sporadically, consultants were taken on for the length of the projects, and they left when the projects were done.
> 
> But as the flow of projects increased, some consultants were kept on, and eventually many of them were provided with annual contracts, and moved from one project to another as one ended and another kicked off. Moreover, by the end of 2012, job descriptions were developed for some of these people, and they were put in units with line management. All of this, of course, makes them look, and very likely makes them be (in many of the jurisdictions in which they work), actual employees, regardless of what OK calls them. And this would trigger employer costs of various sorts, depending on the jurisdiction.
> 
> OK began to respond to this in the fourth quarter of 2012, though only taking concrete action in the UK. At the time of writing, 24 out of 28 UK staff had been converted to employment,. This was done on a staggered basis given other work demands on the Operations Unit. (I was advised that the other UK staff, for one reason or another (e.g., they have work with other organizations at the same time) are clearly not de jure OK employees.)
> 
> The situation is less settled elsewhere. There are four full-time staff working from Berlin, none of whom is an employee yet. There are plans to consult a German lawyer on converting them to employment status (and to determine what administrative and other responsibilities that will impose on OK), but nothing definite had happened at the time of writing. There are three full-time consultants in the US, and a total of nine other full-time consultants scattered across seven other countries. There are no plans at the moment – out of the crush of other things that need doing – to determine their status under local law, let alone to respond to a determination in any of those places that they are indeed OK employees. 
> 
> There is potential very significant liability here, at least because, in the event that the UK government learns about their prior treatment, and determines that all the UK-based consultants were in fact employees for some periods at least, OK would be liable for employer-related National Insurance contributions. (Given that no research has been done in relation to the relevant law and regulations in the other jurisdictions involved here, I can’t say what the potential liability would be in those places (if the consultants there are deemed to be, and to have been, employees).)
> 
> As with the other problems discussed above, the Board has been apprised of this matter and has discussed it regularly, including over the period (until October 2012) when their legal counsel sat on the Board. 
> 
> While I cannot speak to the risks here, I do think that, at a minimum, inquiries with a UK and a German solicitor need to be done, with an aim of obtaining formal advice on how to proceed in both jurisdictions. (Laura advises that they have been “in talks” with their UK solicitor.  What is needed, however, is formal advice that gives OK some comfort that their approach is appropriate in the UK and advice about how to proceed in Germany.) 
> 
> [Update, 26.11.14: I have been advised by OK, but have not independently confirmed, that “initial review of the international employment situation began in Q4 2013. In June 2014 [ok] made this a top priority post OKFestival in July and with support from Omidyar Human Capital have been moving forward. As of November 2014 review and planning are [proceeding] rapidly including consultation with experts such as lawyers in key jurisdictions (e.g. Germany, Netherlands, US).]
> 
> 
> 
> 
> 
> ---------- Forwarded message ----------
> From: Morris Lipson <morrisdlipson at gmail.com>
> Date: 27 November 2014 at 08:07
> Subject: really and truly version of report
> To: Rufus Pollock <rufus.pollock at okfn.org>
> Cc: Martin Tisné <mtisne at omidyar.com>, Andrew Clarke <aclarke at omidyar.com>
> 
> 
> Dear Rufus,
> 
> Please find the final version of the report which we've negotiated and
> agreed on and which you should feel free to post on your website
> should you and your Board so choose. As is my regular practice, I have
> only provided a PDF version of this document for you, though will
> provide a Word version to Omidyar, which you can obtain from them in
> the event that they agree to release it.
> 
> Again, all the best with OK as you move forward.
> 
> Morris
> 
> 
> 
> -- 
> Rufus Pollock
> Founder and President  |  skype: rufuspollock  |  @rufuspollock
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> 
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> <ok evaluation for publication on ok site.pdf>
> <ok evaluation for publication on ok site.docx>
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