Google scraps minimum wage, benefits rules for suppliers and staffing firms

By Daniel Wiessner

(Reuters) – Alphabet Inc’s Google on Friday said it will roll back requirements that U.S. suppliers and staffing firms pay their employees at least $15 an hour and provide health insurance and other benefits, a move that could allow the tech giant to avoid bargaining with unions.

The elimination of the 2019 policy, along with other steps such as limiting access by temporary workers and vendors to internal systems, are designed to comply with shifting U.S. and global labor regulations related to contingent workers, a spokesperson for Mountain View, California-based Google told Reuters.

“These updates bring us in line with other large companies and simply clarify that Google is not, and has never been, the employer of our suppliers’ employees,” the spokesperson said.

The announcement comes after the U.S. National Labor Relations Board in January ruled that Google was a so-called “joint employer” of workers provided by staffing firm Cognizant Technology Solutions and must bargain with their union. Google is appealing that decision.

The board relied in part on the 2019 policy, saying it allowed Google to exert control over the workers even though it does not employ them directly.

The labor board has moved to make it more difficult for companies to avoid bargaining with temporary and contract workers, including adopting a rule last year that said companies with indirect control over working conditions can be considered the employers of contract workers. A federal judge blocked the rule from taking effect in March.

The Google spokesperson on Friday said the company will continue to enforce a supplier code of conduct that requires vendors and staffing firms to provide safe working conditions and meet existing legal obligations.

Most of the company’s suppliers operate in states that mandate a minimum wage of at least $15, the spokesperson said.

(Reporting by Daniel Wiessner in Albany, New York, Editing by Louise Heavens)