
This is why I don't give you a job - fourspace
http://andorjakab.blog.hu/2012/01/06/this_is_why_i_don_t_give_you_a_job
======
antalbud
Dear Andor,

It is hard to leave this post without response. Both because I am Hungarian,
and also because I happen to be an entrepreneur. The only reason I think this
post deserves a response is because it seems you haven't started your business
yet.

So here is my advice: don't do it. Just don't.

Not because of the taxes, but because of your utter lack of respect towards
your future employees. If what's really holding you back is that you couldn't
deliberately fire them, I see no reason why you would even want to hire them
in the first place. I think what you don't realize is that you as an employer
would become responsible for your people. They would depend on you and their
monthly salary, and I think if you see your employees as some company assets
you can just get rid of as soon as things get tough, you really shouldn't hire
anyone to begin with.

I would like to believe you are slightly distorting reality to shake things
up. But if you are actually serious about founding a business, I would suggest
you do not hire your 12 males in their twenties right in the beginning,
instead, you hire a few people you actually _want_ to work with, and pay them
a decent salary. And pay the taxes, as high as they are. Just because _you_
would be happier with lower taxes, does not mean that it would help the
country's economy. Maybe try innovating and charging more instead of low-
balling.

~~~
andorjakab
Dear Antal,

I am well aware of this type of criticsm, because I've already got it with the
original, Hungarian post. I could have rephrased it to avoid some of the
misunderstanding. But I didn't change a word, only translated to English what
has already provoked a lot of thought.

In fact during my long life as an entrepreneur I employed more people than
most of my harshest critics. Most of my employees were actually women. I
treated them with great respect and I'd like to believe they're thinking about
me as a good boss.

In fact, this post isn't really about me. It's about something much bigger
than me. I know it's provocative, over simplifies many things, even populist
if you will. It's not an academic lecture. It's how many smallbusiness owners
feel about an environment that is leathaly poisoned by corruption. In which
being honest makes you very uncompetitive.

I get a lot of advice about how to survive under these circumstances, how to
trick the system, how to avoid employees stealing my (intellectual) property,
how to do business. In fact, that wasn't my point. I know all that. I'm fine,
in fact I'm one of the last persons who will not be fine in Hungary.

In fact I don't mind high taxes and strong social security. What I'm worried
about is that it's ok for others not paying these duties, and they make honest
smallbusinesses uncompetitive. Among many other things that make this society
really, badly, deeply screwed up.

So badly, that Hungary is now marching towards national socialism. Something,
that every intellectual should fight tough against. And that's what I'll try
to do with my blog.

~~~
antalbud
Yes, I get advice on how to cheat the system, too. But it does not mean it's
the only way to succeed. Maybe I'm an odd case, but I have managed to build a
business where I can still respect and pay my employees properly, where I
could be happy if someone was having a baby, and where I pay my taxes
properly. And I still make a profit. Yes, maybe I would earn more otherwise.
But I have always seen it as a choice, and my integrity and the well-being of
others was more important.

My point was only that the system is not _that_ bad that you wouldn't have a
choice. Of course, that choice is yours to make.

~~~
andorjakab
I'm not saying, that it's _that_ bad, that it's actually _impossible_ for
everybody, in every case. It it _was_ that bad, it would be too bad. :) It
would mean, there would not be any companies left. My point is, goverments
should not promote the idea, that employers and employees are enemies. Because
they're not. Or as somebody here has put it, "business are people". I am, for
one.

------
henrikschroder
Yes, social responsibility is a bitch for the individual businessman. Boo hoo
hoo.

But for society as a whole, these things are good. Long maternity (and
paternity!) leave is good for the children that will one day grow up and
become productive members of society. Having laws around parental leave
preventing discrimination means that society doesn't have to deal with paying
unemployment welfare for women around 30, and having a hard time re-
integrating them into the workforce at 40. Instead this cost is spread out
among all the companies in the form of employment laws.

I understand that all businesses _wish_ to have a workforce consisting only of
young well-educated males that are never sick, never take vacations and work
lots of overtime, but there's a cost to getting that, and almost all
businesses forget, or refuse to understand the value society provides to them.
You want a workforce? Sure, it's gonna cost you, both in corporate taxes, and
in social responsibility by employing less desireable individuals. Tough shit,
pay up.

~~~
yummyfajitas
_Instead this cost is spread out among all the companies in the form of
employment laws._

No, it's spread out among all the companies that are willing to hire women.
The companies that discriminate against women have a competitive advantage
over those that don't.

(Note that under normal circumstances, discrimination is a competitive
disadvantage. If I hated Indians, for example, I'd never have found my current
team.)

~~~
scarmig
Two issues:

1) You overstate the likelihood of the market driving out discrimination.
Racist and sexist discrimination has existed for centuries without the market
ever reaching the equilibrium state of no discrimination that would result if
people were rational market participants (1).

2) Inevitably people bring up Scandinavia in these discussions, and for good
reason. Scandinavian countries have both very generous family benefits
(including paternal leave!) and high representation of women throughout the
workforce. This isn't dispositive, but it does suggest the situation is much
more complicated than the original post would suggest.

All in all, I prefer to live in a world where everyone pays their fair share
instead of trying to eke out a couple extra cents of profit by not providing
parental benefits to mothers and families.

(1)This is actually an even subtler issue, because it's possible for markets
to exist where racism and sexism offer a competitive advantage, due to
consumer preferences.

~~~
Iv
Scandinavians have sane laws about parental leaves : both parents get the same
amount. Therefore if you hire someone in the 25-30 age range, there is a high
risk of having to do without this employee, regardless of his/her gender.
IIRC, the rule is 12 months to be split between the two parents, no part being
smaller than 2 months.

~~~
dagw
The 'down' side is that now us guys also get discriminated against. I've been
more or less asked straight out about my family situation at a job interview,
and I could tell from the expressions on their faces that they didn't like my
answer, and I didn't get the job. Of course it's impossible to say why, as
there where a couple of other good reasons why they might have rejected me.

------
mtts
A classic among businessmen all over Europe (I'm Dutch).

And it's wrong(1).

When you spend 3000 Euros to hire someone who nets 1500 Euros, the difference
is not "stolen" by the government, it's what you pay to have access to a pool
of highly educated potential employees who get free(ish) health care,
childcare, pensions that you as an employer don't have to worry about.

There are of course places where such taxes are not levvied, but it's a
mistake to assume an employer can simply pocket the 1500 Euros difference as
employees will demand higher salaries so they can save up for their own
medical care, child care and pensions.

(1) Except the bit about maternity leave: it may not be three years (!) all
over Europe but even if it's a mere six months it's enough to cause small
businesses to be very reluctant to hire women in the child bearing age.

~~~
fauigerzigerk
You're right, the money is not stolen and the comparisons to other
countries/systems are sometimes very odd. But if you take away 50% from
everybody, the assumption has to be that everybody wants to buy all the same
things in the exact same amount and quality.

The government takes away your "right" to find your own balance between
opportunity and security. The government takes away your choice and your power
as a consumer to discriminate between different suppliers, which causes those
suppliers to be worse than they might otherwise be. For some things, like
health care, the assumption is broadly correct, if the quality controls work
(that's a big if). For most other things it is not correct at all.

Not everybody wants to retire at the same age or at all. Not everybody wants
to secure the same pension or start saving for it at the exact same time of
their life. Not everybody wants to go to university. Not everybody wants to
have children or send them to the exact same (mostly broken) type of school.

Not everybody wants to buy expensive protection against being fired or getting
sick for a week. Not everybody wants to support the local opera house,
museums, the government's very own TV network or that network's very own
classical orchestra. Not everybody wants to subsidise railway lines to remote
parts of the country or the post office there.

And then there's the problem that some groups of people that are close to the
government or belong to well unionised traditional industries are getting a
lot more out of it than everybody else. The system isn't driven by need, it's
driven by affiliation. Affiliations are a complex web and hence entitlements
are organised in an extremely complex and ineffecient way that makes people
want to stay put once they have a achieved a certain entitlement status.

At the end of the day, we're paying 50% into government coffers and yet we
have widespread poverty in many European countries because the poor are a
minority without much of a say in anything.

I'm not arguing for letting people go hungry, untreated and homeless when they
cannot help themselves. I'm arguing for redistributing money instead of
forcing canned buying decisions on everybody. I'm convinced that catching
those who fall does not take 50% of all monies earned.

~~~
georgefox
_> But if you take away 50% from everybody, the assumption has to be that
everybody wants to buy all the same things in the exact same amount and
quality._

Not really. It's a matter of risk pooling and public good. In health
insurance, for example, it's understandable for a healthy person to pay a
premium higher than the value of the services he actually receives. In
exchange, if he suddenly gets in a car accident, an expensive procedure may be
affordable. Additionally, his disabled neighbor may be able to afford his
otherwise extremely expensive care. This sort of scheme only works effectively
when everyone participates, especially the healthy, low-cost folks, who bring
down the cost for everyone else.

The same or similar concepts apply in unemployment insurance. Someone with a
stable job may not feel he needs unemployment insurance, but paying into the
system makes the system possible. If only the unemployed and underemployed
paid for unemployment insurance, we wouldn't have such a thing.

With education, things are a little different. There are some people who will
never have children to benefit from paying for public education, but these
people indirectly benefit from living in an educated society. I don't have
children, but I'm more than happy to contribute to public education, since I
value literacy not only in myself but in others.

Arts (e.g., your TV, symphony, and museum examples) are basically an extension
of education, though I suspect some people would probably argue against me
there.

Infrastructure in rural areas is expensive, but in my experience, at least,
those rural areas are often poorer than the more urban areas. Your options
seem to be (a) cut those people off from society, (b) subsidize their
infrastructure, or (c) pay them to move elsewhere. I think (b) is the most
reasonable option.

In the end, the people in the most need generally have the least to offer, so
the people with the most to offer either have to subsidize, or the least have
to go starving. Universal, progressive taxation seems like a very reasonable
way to accomplish the goals of a civilized society.

~~~
sopooneo
I don't know if what I am saying contradicts you, but health insurance
certainly can serve a rational purpose even if everyone that bought it was
young and healthy. You premium simply needs to cover the average cost per
subscriber plus some profit for the provider. It can (and possible _should_ )
also function the way you describe with the lower cost subscriber subsidizing
the cost of the higher cost subscribers. But that is not an inherent part of
insurance.

~~~
georgefox
Agreed, that's a huge part of health insurance, and that's why I would never
consider dropping coverage. But in practice, wouldn't health insurance almost
have to subsidize the expenses of high-cost folks at the expense of low-cost
folks? Actuarially, you'd have to manage to get exactly the average cost from
each subscriber (plus an equal or proportional amount of profit) in order for
that not to happen.

Now I'm assuming you're strictly talking about health insurance (though the
same concept applies to homeowner's insurance, etc.), but isn't subsidizing
high-risk/high-cost subscribers inherent in some forms of insurance? Take a
pension, for example. Some people will live much longer than expected; some
will die a year after they retire. The only way to account for this, other
than periodically adjusting each retiree's income based on how unhealthy they
are, is to pay for the pension of one ancient retiree with the funds from one
who died young.

------
toyg
After the first paragraph I was already thinking "Wow, I don't want to work
for E760 per month, that's basically on the poverty line!"... then I checked
where the guy was from; Hungary is a backwater, and absolutely NOT
representative of the EU, probably not even of the old eastern bloc.

Three-years maternity leave? That's unheard of in western Europe, most
countries allow for less than a year (my wife got 6 months in the UK); men
only recently started to enjoy some rights in that sense (in the UK it's two
weeks).

He talks about a post-50 "protected age" where you can't fire people. That
doesn't exist in the UK, where we have the opposite problem (firms firing
people near pension age, and then hiring youngsters at 1/3rd of salary). I
know in other countries laws are tighter (in Italy it's fairly hard to fire
people, for example), but as people say over there, "Facta lex inventa fraus"
(as soon as a law is written, a way around it will be found"): in countries
with rigid laws, firms now hire almost exclusively on a temporary basis, i.e.
they hire people as contractors for years or even decades, abusing the
relationship.

The high taxes and pension contributions are also a factor in Italy and in
France, but not elsewhere.

What this post is representative of, is the general douchebaggery of European
"entrepreneurs"; they usually come from "old money" (banks are very
conservative with their lending, favouring entrenched players) and bring a
terrible mindset to the workplace, i.e. "screw the employees, they're just
idiots anyway". This obviously doesn't motivate workers, keeping productivity
low.

~~~
Maro
There are real entrepreneurs in Hungary, like myself, trying to get a product
off the ground, raising money, eating ramen.

Some startups from Hungary with funding:

    
    
      - LogMeIn: remote-login-as-a-service, had Nasdaq IPO
      - Ustream: live streaming, raised $100M
      - Prezi: nifty presentations, raised $10M
      - Indextools: webmaster tools, acquired by Yahoo
      - Pocketguide: nifty iPhone tourist guides, raised couple $Ms
      - Gravity: recommendation engine, raised couple $Ms
    

Yes, we'd need a lot more.

~~~
jstepien
For those of you who've used the Hamachi VPN software, LogMeIn are the guys
behind it.

~~~
dotBen
Arhh yes, the open source VPN software that LogMeIn decided to buy that they
essentially broke the app with a software update to then force everyone to pay
_(I don't have the exact figure)_ something like $200+ a year to use.

I remember those guys!

------
kls
Wow I always hear people talking about why Silicon Vally cannot be reproduced
in Europe, but I have never seen anyone put it so pointed. Thanks for
education someone in the States about the realities of some areas of Europe.

~~~
_delirium
Things vary on many axes, though. I'm pretty sure that, in Silicon Valley, if
you came out and said you would never hire a woman or an old person, you would
be fired immediately and blackballed from managerial positions for life (or if
you were the owner, sued into oblivion). Meanwhile, in Hungary, I'm going to
guess Jakab Andor keeps his job and will be free to hire or not hire who he
likes--- because Hungary presumably doesn't take antidiscrimination laws as
seriously as the US does.

(Also, there's much less corruption in the US, which is probably the key
difference.)

~~~
jodrellblank
He didn't say he would never hire a woman or an old person, he said he
wouldn't hire a woman or an old person in the context of a startup.

He might be a HR manager in a larger company with good resources, happily
hiring all kinds of people for all we know.

~~~
andorjakab
I agree, that this problem is the most obvious with small companies. But I
think that even on the national scales these regulations harm those, whom they
aim to protect. It's a wrong concept to treat the employer and employee like
enemies. The good concepts would be win-win-win scenarios. For example,
goverments should REDUCE the cost of hiring the handicapped instead of forcing
companies to hire them.

~~~
jodrellblank
A government can't say "no prenancy until you have saved enough to raise your
child without working", it's unenforcable.

If you force companies to pay for women being pregnant and raising children,
companies hurt. If you force companies not to pay, women hurt because
pregnancy means instant unemployment and loss of income. If government pays,
everyone pays in taxes even startups and people with no children (but at least
the cost is spread widely). If nobody pays and it's left to charity, women and
children live in poverty and suffer from that.

In individual cases, a couple can choose when to have children such that they
can win no matter the situation, by deciding to save, or arrange to live on
one income, etc. But I don't see any win-win scenarios that can be enforced
from outside by legislation. Can you?

 _For example, goverments should REDUCE the cost of hiring the handicapped
instead of forcing companies to hire them._

How could they do that (without charging you taxes to pay for it)?

~~~
andorjakab
"How could they do that (without charging you taxes to pay for it)?"

Easy.

Let's say, in my country €760 NET is a very good salary. If I advertise the
job, I get thousands of people to choose from. Some of them will be
handicapped. Let's say there is a goverment regulations, that employing the
handicapped is duty-free, like cigarettes at the airports. Now I have two
options. I either choose somebody who isn't duty-free, and pay €1572 (the
empoyee still gets only €760), or, if I'm LUCKY, I will find a somebody
suitable for the job among the handicapped persons, and I can choose him or
her for the job. That way I've cut my employment costs two half, without
paying ANY taxes. It's a nobrainer, even if I have to make some changes in my
office to accomodate it for the duty-free person. Because I can slash my
employment costs into half on the long run, without paying 1 cent less Salary
than to everybody else. And the state? It's a win-win-win. Now they have a lot
less people to worry about.

------
fierarul
The title should be "why I don't give you a job _without doing tax evasion_ ".

In Romania it's about the same: the taxation for an employees is high and so
is social security (pregnancy leave, difficulty firing, etc). But people don't
complain as much because tax evasion is really high.

Of course, this is really annoying for me because if your customer is in the
US they will not pay you behind the counter, they will do a wire payment or
such, which goes straight into accounting and is taxed.

In this regard, tax evasion becomes unfair competition.

~~~
bad_user
Also in Romania -

Some companies are preferring contractual work and abusing it, by putting
clauses in the contract that employees cannot quit for the next 5 years. This
works in the cases were employees need to travel a lot (for example) and in
the contract it is stipulated that if you quit, you have to pay the costs of
accommodations, food and "training" provided during the contract, which is not
feasible for most people.

This IMHO, is equivalent to modern slavery. If you're not able to quit, you
cannot complain, you cannot negotiate a higher salary and you are at your
employer's mercy.

~~~
reinhardt
It's only fair if employers cannot fire people at will (without being sued to
oblivion). "I can leave anytime I want but you cannot fire me" doesn't make
sense.

(For the record I am for at-will quitting and firing)

~~~
jubalfh
Good luck at your next meeting with the firing squad!

------
ootachi
The author realizes that these 5 restrictions don't even apply in Silicon
Valley, right?

1\. I can fire you, if I want to.

California has at-will employment, but you sure can't fire someone based on
gender or age anywhere in the United States—and he opens with his desire to do
just that.

2\. If VAT goes down to at least 20%, better yet 15%.

Sales tax alone is not 20%+$.01 anywhere in the Bay Area, but there are a
surprising number of added taxes here and there—Healthy San Francisco, for
example, or the California state gasoline taxes—that can make the surcharges
on consumer goods add up to that level.

3\. If the state takes away "only" 30% of your money.

Federal income tax + California state income tax + FICA significantly exceeds
that for most people in the technology industry in Silicon Valley.

4\. If higher income is not exponentially punished.

The US certainly does have a progressive income tax scheme.

5\. If the states punishes corruption instead of decent companies.

No-bid contracts, anyone? The US is hardly free of corruption.

He's asking for a place that doesn't exist. Moreover, it's a place I wouldn't
want to live in; I don't want to live in a place where it's legal to
discriminate against minorities, in particular.

~~~
moonchrome
>California has at-will employment, but you sure can't fire someone based on
gender or age anywhere in the United States—and he opens with his desire to do
just that.

I don't think you understand his position at all. Trying to fire someone in
Europe is often compared to adopting a child, lawyers will take cases against
former employers on commission because the probability of winning the case is
extremely high. There is no comparison when it comes to US at-will employment,
for eg. you have to be able to prove that the employee you fired for coming
drunk to work was really drunk, that you gave him written warnings, flowed the
formal procedure etc. To be fair tough, employers often use employment
agencies that exploit loopholes but it only serves to increase the cost of
labor. The only ones benefiting from these laws are the public sector and
government owned company employees (ironically even government owned companies
resort to exploiting loopholes because even they can't operate under the
regulation). And these are probably much higher percentage of workforce than
in the US.

And the corruption he is talking about is tax evasion and gray market, that's
a huge part of the economy in these countries.

Also, I'm thinking the "progressive tax" in the US kicks in at a much higher
nominal amount then Hungary, and that it's disproportionate to the cost of
living difference.

~~~
Maro
I'm from Hungary, and I never heard of anyone suing their employer after
getting fired. I'm not saying it doesn't happen, but you have to realize that
the US is super-litiguous, E.European countries in comparison are at the other
end of the spectrum: it doesn't really occur to people here to sue after
losing their jobs. It's just not part of the culture. Also, private
individuals can't afford lawyers, and don't want to deal with them.

~~~
andorjakab
Of course they do sue. There is the whole "Munkaügyi Bíróság" (Work Court or
whatever) to deal with the zillion lawsuits against companies firing people.
And I'm not saying it's wrong. I'm saying, more often than not, these
regulations backfire, and harm those, whom they should protect. Goverments
create an environment in which employer and employee see each others as
enemies, literally. They promote this view. Here I experience public anger
against companies, investors, banks, especially multinational companies, but
even smaller companies, who look successful. "Workers" see companies as their
enemies. This is plain wrong, and bad, and nobody benefits. Only the corrupt,
inefficent, incompetent goverments.

~~~
Maro
Yes, you're right. My point was that Hungary is _probably_ still better than
say the United States, which is famous for being a very litigious nation.
Unfortunately, I can't find number to back up my gut feeling.

------
mhartl
The solution to all such problems is as obvious as it is unlikely to happen.
It's not "women get six years' vacation if they want it". It's not "at-will
employment". It's _complete freedom of contract_ in the context of _secure,
effective, and responsible government_.

You and your employer come to an _ex ante_ mutually beneficial agreement. A
_secure_ and _effective_ government will enforce such a contract, unless it
represents an egregious abuse by one of the parties. A _responsible_
government will formulate a wise definition of _egregious abuse_.

Once you start to enumerate all _unenforceable_ contracts, you will come to
understand how far we are from this situation. And when you look at how
insecure, ineffective, and irresponsible governments are, you'll see why we
may never get there.

------
bmelton
And this is, in large part, why startups work so much 'better' than larger
companies.

Startup hires tend to be somewhat self-selecting, as the jobs tend to draw
young males without families. The risk of the job makes it more appealing to
those types, but the field is generally overrun by men, which is a topic that
seems to come up every few months as well.

What that means is that the eco-system is better for lean startups. You don't
have to have the 'buffer' budget over actual costs that corporations do. Large
companies typically offer paid vacation, matching 401k, disability leave,
maternity leave and all that jazz.

If you're working on a lean startup right now, ask yourself what would happen
if your lead developer disappeared for three months.

This is one of the real disadvantages we face as a nation because, in large
part, the people we outsource labor to don't have these protections.

~~~
sliverstorm
What? How exactly was he describing a non-lean company? Hell, he was angling
his wife as a supplementary source of income, and his home as investment
capitol!

~~~
bmelton
I believe you misunderstand me. I never said that he wasn't a lean company.

I was comparing the average lean startup to the average large corporation.
Neither made-up example was his company.

~~~
sliverstorm
I do not understand. Is your comment even related to the article at all then?
This whole article is about how startups don't work in Hungary, and you're
talking about how this is evidence why startups are so much better?

~~~
redthrowaway
I think you're right; you don't understand. He's taking the arguments made in
the sub as to why it's hard to start a business in Europe, and extending them
to the inherent competitive advantage of startups over large corporations
elsewhere. The fact that startups largely don't have to deal with the issues
described in the sub, while large corporations do, contributes to this
advantage.

------
mihaela
I'm a woman running a small ISV in Croatia, and a mother too. I would never
hire a woman either, for the same reasons. As a matter of fact I wold not hire
anyone locally, I just opted for the "outsoucing" via VAs and such. The thing
is that it's very hard to fire someone, and human workers cost too much.

------
Evgeny
Sort of "meta", but interesting:
[http://andorjakab.blog.hu/2012/01/03/hungary_not_funny_anymo...](http://andorjakab.blog.hu/2012/01/03/hungary_not_funny_anymore)

 _That blogpost made me kind of like a celeb, a bloghero or something. Fact
is, that single blogpost generated half a million pageviews, 91141 Facebook
likes in a matter of days. It was covered on national television, I was "the
blogger of the week" at the biggest local blog provider (blog.hu), a whole
bunch of responses were written by big names in the trade.

Newmedia analysts were trying to figure out what made it such a big meme, out
of the blue, from totally nothing, without any mainstream media promotion.
People shared it like hell, on Facebook. Likes were rising by hunderds, by the
second. Like this: 30145, F5, 30359 ..._

~~~
sliverstorm
What made it big should have been obvious- it hit a nerve. It rang true. He
wasn't just ranting and making shit up.

~~~
mnyary
The right-wing Hungarian government changed the law of work relations. This
rant was part of the campaign to gather support for the initiatve. It
represents a very popular opinion, but popular does not mean true. For your
information:1. Is it almost impossible to get a job if you are over 35; 2.
Several people over 55 were fired recently. There are horrible stories.

------
danmaz74
Just as an added fact, for those who don't know it, Hungary is currently ruled
by an extreme right-wing party which is pretty much doing away with democracy.

Edit: The EU is considering if measures should be taken; I hope they will, and
fast.

~~~
daliusd
I hope Hungary will not get financial aid from IMF and ECB (if I remember
correctly) or will make it extremely hard to get it. That will harm Hungary in
short term but in long term it will be good for all the Europe. It will send
very good signal for all other Europe countries where right-wing extremists do
stupid things (especially Eastern Europe).

P.S. I'm from Eastern European country and I see some similarities with
Hungary.

~~~
danmaz74
I would like even more the EU to have a direct way of dealing with this kind
of situations, but for now I agree with you - that's the fastest way to
pressure the Hungarian government.

------
someone13
Counterpoint to the idea in this article - I don't like the idea of at-will
employment. I'll keep the political or ideological ranting off HN, but in
short, I don't think that being able to fire any employee for any reason
whatsoever is a good idea.

Interesting to hear how things are in other parts of the world, though.

EDIT: If you're downvoting, by the way, please leave a comment about why. I
don't really care too much about the karma, but I'd love to hear why people
disagree (and for the record, this comment is at -1 at the time I edit).

~~~
pohungc
Why do you think being able to fire any employee for any reason is not a good
idea?

~~~
ifearthenight
Would be interested to hear your thoughts on competing individual rights
inside a capitalist society. More specifically the company owners right to
make a profit versus the employees right to make a salary. Interested to know
your opinions on why the employers rights supersede those of the employee.

~~~
Radim
I think you're confusing "rights" and "freedom to persue".

Capitalism is about free trade and _voluntary_ exchange (of whatever); "right
to profit" and "right to salary" sound both horrible and rather anti-
capitalistic.

~~~
ifearthenight
Actually agree with you that maybe I shouldn't have gone for capitalism to get
my point across. But then again aren't you confusing the concepts of "free
market economy" and capitalism with the former just being one possible form of
the latter. Another possible form being a "social market" which should allow
for some kind of state intervention on a lot of the issues being raised here.

PS A genuine thank you for engaging in discussion as opposed to hit and run
downvoting

------
kayoone
I run a company in germany, if my employees want EUR 1500 net salary, which is
very little for a trained professional, it costs my company roughly EUR 3000.
So not that much better.

I dont know what this guy is doing but he should just sell his service
internationally so he could easily charge double the money and would solve
most of his problems.

~~~
vacri
It's interesting that you speak of salary in net. In Australia we speak of it
in gross, and the rule of thumb is that an employee costs about 30% more than
their gross, which includes 9% mandatory superannuation, payroll tax, and
other sundry employment costs.

~~~
alga
See! The net salary and the total cost of employment are the sole interesting
figures when comparing internationally, the gross salary is a largely
arbitrary figure between those two.

------
andorjakab
It's an honour to be discussed here, HN is my #1 source of useful information.
I won't disturb. But please let me use this chance to get some tech help. The
Hungarian version of this post
([http://jakabandor.blog.hu/2011/07/27/tolem_ezert_nem_kapsz_m...](http://jakabandor.blog.hu/2011/07/27/tolem_ezert_nem_kapsz_munkat))
has 'lost' it's Facebook likes. I can't figure out why. If you check it with a
tool (<http://saqoo.sh/a/labs/fblinkstats/>) it's there, but 0 is displayed on
the blog. Any ideas?

~~~
zeynalov
I see 91,143 people like this - on that blog post. Facebook like are seen when
you type exact same URL. When there is a link with dynamic atributes like
<http://www....blogpost?commentform234> than it'll not show the likes,
comments etc.

~~~
andorjakab
That's not the issue. It doesn't work with a clean URL either. What I see now
is strange. It doesn't work with Firefox, but it does with Chrome. I have this
issue for half a year now with likes disappearing.

------
3pt14159
I can't believe how pro-government interventionist the views are here. Sure
the guy's rant was over the top, but isn't this Economics 101? Arn't all the
added costs the government puts on hiring workers perfectly reflected in the
supply demand curve resolution?

You might not hear about it all that much because it isn't cool to blog about
it, but doesn't it make sense that women make less money when, on average, it
costs more to hire them?

This isn't about right or wrong, it's math.

> Yes, social responsibility is a bitch for the individual businessman. Boo
> hoo hoo. - henrikschroder

Social responsibility for a business is to provide goods to the public through
voluntary exchange while adhering to the non-aggression principle. Every other
benefit should be provided by personal savings, family support, and voluntary
donation. If you really want forced help to new mothers or other
"disadvantaged" people then provide it by the state where the costs are
transparent. The people hurt most by these policies are women who do not want
to be mothers.

> But for society as a whole, these things are good. - henrikschroder

I disagree. These interventionist practices increase tension between
subcultures. They turn the world into an "us" vs "them" environment, where it
would be more optimal to have a "me" and "you" environment.

For example: Affirmative action. Many blacks that get into Harvard and
graduate are treated as sub-students by employers like major banks. The reason
is that by definition they have, on average, poorer standings when they enter
university. A black person that truly deserved to get into Harvard is
indistinguishable from one that got there only after the bump from affirmative
action. Employers remembering their time at Harvard recall that the black
people in there class, while smart, were not of the same caliber as the rest
of the class on average.

Furthermore, since affirmative action shifts the whole bell curve to the
right, blacks are disproportionally more likely to drop out of university,
since they are likely the least academically qualified to be there. This
creates further racism as over the years professors tend to note that the
blacks they teach tend to drop out.

Another example: Social Security. While the baby boomers were all working they
enjoyed some of the lowest rates around. Now forward projections show that the
US is unable to meet its SS obligations. Again turning it into "us" vs "them"
(Gen X/Y/Z vs Baby Boomers).

> Long maternity (and paternity!) leave is good for the children that will one
> day grow up and become productive members of society. Having laws around
> parental leave preventing discrimination means that society doesn't have to
> deal with paying unemployment welfare for women around 30, and having a hard
> time re-integrating them into the workforce at 40. Instead this cost is
> spread out among all the companies in the form of employment laws. -
> henrikschroder

People make choices. My choice may be to work until I have enough money to
where I can earn enough interest passively while I go to Africa and join
Engineers without Borders. Or my choice might be to have children. Either way,
my productivity, savings, and future goals need to be harmonized for my plans
to come to fruition.

Most responsible, productive people find it very easy to return to the
workforce. Sometimes they are a step down or two (as in the case of my mother,
who was a former research manager at IBM before she had my brother and me) but
if their skills haven't eroded, they quickly gain back, and even exceed their
position (she's now fairly high up at AT&T managing the internet pipes between
Asia and the Americas, as well as VPN services to huge companies like
Siemens).

If the problem that right to return to work solves is post child rearing
un/underemployment, and the solution is to stem from the government, then the
government should set up organizations that empower employment seeking
mothers, not coerce organizations to hire them again.

Furthermore, I've never met any business owner that didn't want to rehire a
former staff member after they have had their maternity leave. The only time
I've seen someone lean on that law was when they knew they were going to get
fired (written up twice out of three times) so they had a child to reset the
write-up policy.

> I understand that all businesses wish to have a workforce consisting only of
> young well-educated males that are never sick, never take vacations and work
> lots of overtime, but there's a cost to getting that, and almost all
> businesses forget, or refuse to understand the value society provides to
> them. You want a workforce? Sure, it's gonna cost you, both in corporate
> taxes, and in social responsibility by employing less desireable
> individuals. Tough shit, pay up.

First off, most businesses do not want a workforce of men like me. Young,
well-educated, male, lots of OT. We're too much like cowboys. We hate process.
We hate meetings. We might be great at startups, but we are terrible in most
other organizations, and yet most of us don't even know it.

As for the cost, "that is what the money is for" if it is citizens that want
to be educated. Citizens that want to build roads. Citizens that want to have
a safe and peaceful place to live and work. Citizens that want to buy products
in an open market. Then those citizens will vote for those things. If you want
to tax and impose rules on corporations then extend them the right to vote. No
taxation without representation and all that (ironically, this is why
governments are taken over by lobbyists, since the defense for having
lobbyists was that the government makes rules that impact corporations and
that corporations need "sway" in congress to protect their interests).
Otherwise, recognize that the products that you use are brought by
corporations to you, something most people forget.

> When you spend 3000 Euros to hire someone who nets 1500 Euros, the
> difference is not "stolen" by the government, it's what you pay to have
> access to a pool of highly educated potential employees who get free(ish)
> health care, childcare, pensions that you as an employer don't have to worry
> about. - mtts

It depends on how it has been "spent". From the employer's perspective income
tax should be none of his concern. If the citizens vote for a 50% income tax
then that is what they should see on their payment stub.

> Being from Europe originally and having lived in Silicon Valley now for more
> than 10 years, I did the math on comparative taxes. In the end, it's a wash.
> If you take into account everything. I make more money in the US. But my
> retirement costs are higher. And by the time I put two kids through college
> (college is free in some European countries), it basically balances the
> extra cash I made over a 20-year career. - alain94040

I did the math from Ontario, Canada to Texas a couple years ago. Even with a
10k bump in pay and full benefits, it was a wash. America pays a lot of taxes.

> I propose a new law for Hungary saying that every company with more than 10
> employees should have the same percentage of female/male as that of the
> population or in special cases (like with IT) that of the field at
> universities. This would stop some companies profiting from healthy 30 year
> old single men, and then throw them away like rags once they start feeling
> the pressure or want children. - hmottestad

That would be disastrous. Special cases governed by whom? Elected officials?
There is about another 500 pages of laws. Logging towns, IT, Nurses, flight
attendants, basketball players, elementary teachers, the list goes on and on.

~~~
joebadmo
I'll take issue with a specific point: affirmative action. Affirmative action
starts with a premise different from yours: that college admissions shouldn't
be about past performance but about future potential. And if there's nothing
genetically wrong with black people, then blacks should be demographically
represented in colleges. If they're not, then there's something wrong with
admissions.

"A black person that truly deserved to get into Harvard..." You come from the
premise that you deserve to get into college based on your past performance.
That's valid, but you should be making arguments against the premises of the
affirmative action, then.

"Furthermore, since affirmative action shifts the whole bell curve to the
right, blacks are disproportionally more likely to drop out of university,
since they are likely the least academically qualified to be there. This
creates further racism as over the years professors tend to note that the
blacks they teach tend to drop out."

According to the guiding principles behind affirmative action, this isn't
simply a consequence of the policy, but another injustice to be addressed.
Blacks aren't genetically predisposed to dropping out, they just have very
different social and cultural circumstances that aren't conducive to
graduating. The things that you (I presume) and I (I'm Asian) take for
granted, many black people cannot. A proponent of affirmative action would
argue that we need more social college programs that help and encourage black
students in ways that lead to better graduation rates.

"Many blacks that get into Harvard and graduate are treated as sub-students by
employers like major banks."

This is simply prejudice on the part of employers. Why should employers take
into account how someone got into Harvard, instead of judging them solely on
their performance at Harvard?

My point is that you apparently don't fully understand the premises and
reasoning behind affirmative action. Many who oppose it don't.

[Edit]: I suppose my meta-point here is that it's easy to take a hard-line
view when you don't fully grapple with the opposing argument. When you really
fully try to understand the other side, you come to a more nuanced position,
and a respect for the complexity of issues. I think it's parallel to the
Dunning-Kruger insight that you don't know what you don't know. Certainty is a
sign of ignorance, even in yourself. If you are certain about something, it's
time to re-examine your assumptions.

~~~
tzs
> This is simply prejudice on the part of employers. Why should employers take
> into account how someone got into Harvard, instead of judging them solely on
> their performance at Harvard?

That's a good point for employers, where they can perhaps reasonably ask a new
graduate for a copy of his transcript and see how well he actually did, but in
a lot of cases someone evaluating a graduate does not have access to such
details.

For instance, if I have to choose between two lawyers, or two doctors, and all
I know is that they have degrees from the same school, and that one of them is
in a group that was significantly under represented at that school before
Affirmative Action and was not under represented afterwards, then it is, from
a probabilistic point of view, in my interest to pick the one that was not
from an Affirmative Action group.

Example: suppose a school has 1000 people in a given class. Before Affirmative
action, the breakdown was 950 from group A and 50 from group B. Group B is 10%
of the general population, so is under represented at this school. The school
institutes an Affirmative Action program that lowers the standards for group
B, so that they are able to change their class distribution to 900 A, 100 B.

If I later have to pick, say, a lawyer, and all I know is that they were both
in that class, and one is an A and one is a B, if I pick an A then I get
someone who I know met the original admission standards for the school. If I
pick a B, there is a 50% chance he met those standards, and a 50% chance he
was one of the ones who got in under the lower standard.

Without any other information, I'm clearly better off going with the A.

Note that this only applies to school where they lowered standards for group B
to increase their numbers. There are other ways a school can try to get more
B. Caltech, for instance, wants more females. Rather than lowering standards,
they just try really hard to get any qualified women who apply to accept. They
will send a representative to visit the woman and her family to pitch the
benefits of Caltech, for instance, whereas if you are a man you'll only get
that kind of treatment if you one of those once in a decade prodigies like a
Peter Shor or an Arthur Rubin.

~~~
joebadmo
I think implicit in your calculation here is that someone let in on AA grounds
is inferior to someone who wasn't. But the premise of AA is the exact reverse,
in fact. Saw two candidates A and B are born with equal amount of future
potential: 100fp. Candidate B, for reasons of systematic circumstance, did not
perform well before college. Without accounting for systematic circumstance,
then, candidate C, who was born with only 90fp, will get admitted before B,
even though his fp is higher.

It's not a matter of lowering standards, but normalizing them across racial
lines.

A common data-based rebuttal to this is that minority/AA students tend to
perform worse even in school than their non-AA counterparts. But that's a
separate issue, and is pretty obviously going to be the case considering a
lifetime of circumstance. The AA response to this is to promote programs that
help AA students to overcome their past circumstances and perform to their
full potential.

Your example of Caltech is great! That's a perfectly valid way to normalize
demographics, I think, but it doesn't seem to exclude AA or even address the
same issue. They seem perfectly complementary to me.

~~~
yummyfajitas
_A common data-based rebuttal to this is that..._

What data would persuade you that future potential is not equal, if actual
data on future (relative to the time of admission) performance does not?

I'm curious whether your beliefs are falsifiable.

------
mekoka
Don't blame businesses, don't blame women. Blame governments that refuse the
responsibilities of taking hard, but necessary decisions, because they're
afraid it'll cost them votes. They instead play shady games that only _appear_
to resolve issues, when all they do is to force/allow both businesses and
people to dabble in gray areas.

Let's speak hypothetically. Let's say we're a government that sees that we
have too many expenses and as a result have very high taxes. Yet, we still
have some unresolved social issues for which we have no budget, such as
maternity programs and 50+ employment protection (yes, these should be state
responsibilities, no reason to offload it to businesses). We could decide to
reshuffle our current programs to make room for these, but that would
certainly means cutting into some other established programs (unpopular
decisions = no no in politics). Alternatively, we could yet again openly
increase taxes, at the risk of looking even more expensive than neighboring
countries and losing even more businesses (no no). We will do neither, instead
we'll come up with laws that makes us look good with the people (3 years
maternity, ensured reemployment, 50+ protection, all bankrolled by
businesses), while allowing employers to find loopholes (discrimination).

The issues themselves remain unresolved and everybody goes home happy.

------
hmottestad
I always say. A country can be valued by how it protects it's weakest.

I wish people would realize that in a society we should all work together
rather than have the strong huddle in a little pile and point and laugh at the
weak or needy.

I propose a new law for Hungary saying that every company with more than 10
employees should have the same percentage of female/male as that of the
population or in special cases (like with IT) that of the field at
universities. This would stop some companies profiting from healthy 30 year
old single men, and then throw them away like rags once they start feeling the
pressure or want children.

To give incentive to the law I propose giving higher tax to those companies
not following the laws and increasing them at an exponential rate yearly :)

~~~
andorjakab
I'd like to think of myself as responsible person in all possible aspects.
That of course means, that I'd like to be socially responsible too. I would
even go as far as saying that I actually am socially responsible. My point is,
the sort of regulations you are proposing don't work. They impossibly violate
the rules of life, especially when it's a small business. These regulations do
a lot of harm. I do believe seriuosly, that society must protect its weakest.
So goverments should make it cheaper to employ them. That's fair enough. And
then, please, let us do our business. We businesses are people too. We can't
be treated like this, or we just can't survive. We have to close shop, if all
sorts of regulations are against our freedom to do business the way we think
it makes sense. Well, something like this... :)

~~~
hmottestad
If it governs every business I'm sure the fittest business would survive.

And I think that regulations mostly do good and are important to stop bullies
from eating up society.

I'm sure most business thought that outlawing slaves in the US would ruin
them. Now business are thinking that hiring women of child bearing age will
ruin them. They probably also think that not being allowed to dump their waste
in the river will ruin them too.

~~~
andorjakab
You see, they DON'T govern every business. That's the issue. They govern only
the decent, good businesses. This die, the corrupt ones (that are NOT governed
by any regulations, nor taxes, nada) survive.

------
jan_g
The thing (in many European countries) is that government doesn't 'steal' your
money, but that out of every salary you have to pay for many different things.
Income tax is only one aspect.

For those interested, this is the reality in my country, Slovenia, which
borders Hungary (I may have botched some numbers regarding taxation, but the
principle behind calculations stands):

1\. Out of every monthly salary you pay: income tax, state/public pension
fund, health insurance and also a small tax (<1%) called parental security.

2\. A woman or a man may take up to 12 months of parental leave, which is
fully paid by the state. The government uses money from 'parental security'
tax to pay for this privilege. It works, because at any given moment there are
many,many more employees not on parental leave than those on parental leave.

3\. A woman is entitled to sick leave during pregnancy if her doctor makes
such decision. So it may well be that she is absent for two years from her
job. And it is also true that many women abused this privilege simply by
convincing their doctors that they 'cannot perform on the job while pregnant'.
A few years ago there's was a sort of clampdown to this practice by tightening
the control on the doctors' decisions. So it's not that pervasive anymore.

4\. A woman is also entitled to reduced workday (only 4 hours instead of 8)
while her child is under 6. Her salary is of course halved, but state covers
her pension fund as if she worked 8 hours. Many women don't decide to use this
option, simply because a halved salary puts a lot of strain to majority of
families' incomes.

5\. Regarding firing workers: similarly to Hungary it's very difficult to fire
someone and almost impossible to fire pregnant women or old people. Therefore,
majority of people under 35 don't have regular contracts, but they work via
independent contracts or the so-called self-employment companies (you
establish a company in which you are a sole employee and then go work to
another company which pays you via your small company). Needless to say, job
security is practically non-existant if you aren't on regular contract.

6\. Progressive income tax is also here, however it's not as brutal as in
Hungary. Lower salaries (<1k euros) are actually not taxed that much. The
problem is only that the highest tax bracket (41%) comes already at 2k euros
and that hits middle class the most. We, skilled professionals, are usually
complaining the most about this fact. There are discussions to change this
taxation in order to stem the brain-drain. It's also important to know that
progressive taxation is applied on 'past-the-post' principle: e.g. you are
taxed 41% only for your income that goes over a certain amount. This means
that if your salary is 2k euros, you'll be taxed 41% only on income past 1.5k
euros, that is 500 euros will be taxed 41%, 1.5k euros 27%.

7\. Grey economy/tax evasion is certainly a problem, however the tax bureau is
becoming more and more powerful and it's connected with banks. It's actually
not that easy to cheat anymore. That goes for majority of people/businesses,
richest top 5% still game the system by moving the money to Cyprus/Luxemburg
shell companies and so on, but this can't really be helped unless it's solved
on EU level.

Ok, I'll stop now :-). If you have any further questions, then do ask.

~~~
Retric
That's still far lower taxes than I pay in the USA. SS, Medicare, State,
Federal really adds up.

Federal 25%(over 34k), Medicare 15.3% (below ~120k cutoff), Medicare 2.9%,
Virginia 5.75% (over 17k /year). Now many people get tax breaks for various
things but 50% income tax rate is fairly common for the upper middle class
without much in the way of a safety net or public heath care.

~~~
tptacek
It's not quite that straightforward, is it? State taxes are federally
deductible. And virtually everyone in the upper middle class owns a home and
takes a whopping deduction on mortgage interest, and property taxes are also
deductible.

I'd also push back on "not much in the way of a safety net". I'd like
universal single-payer health care, but in the meantime it's worth remembering
(a) once you hit retirement age, you very much do get public health care, and
(b) retirement age is when you're most likely to incur medical expenses.

~~~
caseysoftware
If he's in Virginia (I was there 9 years), it takes a significant income to
have a home. My old one bedroom condo at 835 sqft was 240k in 2005. A single
family home in a reasonable neighborhood starts at $300k pretty easily which
is easily 2-3x prices here in Austin.

The problem is that salaries in DC aren't double Austin.. they're more like
1.3-1.5x.

Also, once you're about the 50k threshold for income, some of those deductions
- like for student loans - start decreasing and disappear.

~~~
tptacek
A $300k single family home is a starter home in the upper middle class.

The only deductions I mentioned --- mortgage interest and state taxes ---
don't vanish at $50k.

------
3am
I submitted a post about this at one point, but Hungary is going through
really terrible cultural and political troubles. I really feel for the
Hungarian people - in that context, the frustration in this post makes much
more sense.

------
GigabyteCoin
Is it just me or does this writer have an incredibly pessimistic view on his
own workers?

Re [sic]: "they will just steal my ideas...", "women will take 6 year
vacations (out of spite?)", etc.

~~~
andorjakab
It is reality. It does happen, that you're a smallbusiness owner, and somebody
you used to hire 6 years ago shows up. She's back from maternity leave. And
you have to rehire her, increase her salary to present level, pay her 4 months
of fully paid vacation. And either grow your company - if you can -, or make
room for her. How? By laying off somebody else. Maybe the one who had to hire
when your employee 6 years ago went left to raise children. This is not a
'pessimistic view', this is what happens all the time.

~~~
GigabyteCoin
Nobody ever said the transition from a small business to big business is a
simple one.

~~~
andorjakab
Especially not this way. Whenever the goverment says they're about to help us
in the transition, I'm already in horror.

------
alain94040
Being from Europe originally and having lived in Silicon Valley now for more
than 10 years, I did the math on comparative taxes.

In the end, it's a wash. If you take into account _everything_. I make more
money in the US. But my retirement costs are higher. And by the time I put two
kids through college (college is free in some European countries), it
basically balances the extra cash I made over a 20-year career.

Of course, for any given situation (single, dual income no kids), your results
will vary. But I'd argue that a household with 2 kids is fairly common.

~~~
kcima
Even if it is a wash, and the costs of things end up being the same, the real
issue is the question of who should be spending the money you earn.

Should the government be allowed to forcibly take your earnings away to pay
for your kids college and purchase retirement for you?

What if you decide your kids would be better off earning their own way through
college, or what if you want to retire in a location with nice weather and a
very low cost of living?

It sounds like living in Silicon Valley has not made you more wealthy, it's
just provided you with a wealth of choices that the author of this article
doesn't have.

------
Georgiy
In Russia if you don't minimize taxation with tricks and do it straight, you
pay like 1,2$ for each 1$ your company makes. So mostly companies aims for
super profitable niches, like selling chinese shit with 1000-5000% margin.

~~~
Evgeny
Or you have the 'official' salary of $50/month, and you get the rest paid to
you in cash in the envelope each month.

Well, at least that's how things were about 10 years ago when I left - it
could have changed a lot.

There was some economist who estimated that if a business in Russia pays EVERY
tax it's supposed to by the law, it will pay way over 100% of the profits in
taxes. So technically there is no business that is following the law 100%,
giving the 'controlling organs' the power to ask for bribes. Could be an urban
legend though, I don't have links.

Edit: The parent talks about general taxation, and my take is about the taxes
a company has to pay for each employee on top of her salary. Still, I think,
"white" and "grey" salaries is an interesting point.

~~~
tsotha
That's how things are done in Korea. Your official salary is only a tiny
fraction of your actual salary.

~~~
white_devil
Care to elaborate? I've been thinking of possibly setting up some kind of shop
in Korea, so it would be interesting to know more.

~~~
tsotha
My ex was Korean. Her dad worked at an insurance company, and every month he
got his (tiny) official salary as well as an envelop full of cash, which was
4x more money. I asked her about it and she said small companies are normally
completely "off the grid" from a tax standpoint, so mid-sized companies need
to do this to compete. And they all do.

She opened a bar and never, you know, registered as a business or kept books
or did any of the other business things you'd need to do in the US to stay out
of jail.

Her impression was tax receipts come mostly from the giant _chaebol_ like LG
and Samsung.

~~~
white_devil
OK, thanks for the information! I wonder how all those small companies manage
their cashflow though. Can they receive money to their bank accounts just like
they would if paying taxes? It's kind of difficult to imagine they're all
shuffling cash around.

~~~
tsotha
My impression (maybe wrong) is that Korea doesn't have the cash reporting
rules we have in the US. So yeah. Cash.

------
leak
This was a really long, enjoyable article. My question is, how does the
company that he works for manage to pay him enough to buy a 90k flat? Are they
shaddy like the other companies he described? Is he shaddy and not paying his
taxes? How did his employer manage to do it and why can't he just follow that
path?

~~~
veszig
In Hungary smaller companies usually cheat on their taxes... it's a national
sport.

~~~
leak
haha I really do believe that is true.

------
16s
I had a female boss once. She said the exact same thing about not hiring women
because they get pregnant.

I'm a man in the U.S.A. We don't have all of the laws as described in this
article (most of us can be fired for any reason at any time). We're on our
own. My wife got 4 weeks leave when she gave birth and that was at 50% of her
normal income. Then she went back to work (and governments wonder why births
are declining).

Anyway, I was shocked that my boss felt that way about women employees and
because she was so matter of fact about it. She didn't have children herself
and was past child-bearing age. She was very successful (several master
degrees and a very wealthy husband). She was one of the best managers I ever
had. But basically, she was a woman who would not hire other women.

~~~
andorjakab
My message is completely different. I do want women to be able to have a long,
paid maternity leave. It makes sense. But my goverment shouldn't kill my
business either. Isn't that fair to ask? When I'm doing business, I'm a paying
a ton of money, thousand times more than the average guy. It doesn't make
sense to further punish me, through killing my business via absurd regulations
that don't make sense.

~~~
alga
Then you're not making sense. Do you want to be able to fire pregnant women,
or do you want to be able to refuse them employment after they return? That
would be a horrible thing to do, perhaps it's good that you're not an employer
then ;-)

~~~
andorjakab
You misunderstand. Taking care of people is not my responsibilty. It's the
state's responisbility. That's why we pay all the taxes and social security.

A business - especially a small business - isn't a place for altruism. I just
can't afford hiring people to help them get along with their lives. A business
is a business, not social welfare itself. It pays for welfare, but it _is_ not
welfare.

I stated exactly what I want. I want to be able to decide on my own, who I
hire, who I do not hire. It is as simple as this. They CAN create regulations
that FORCE me, but then I choose NOT to do business.

I also suggest other means of helping underpriviliged people to obtain jobs.
Such as making me pay LESS if I employ them. That would make sense, in
business terms too.

------
zdw
Simple solution - gender equality for time off related to pregnancy. Paternity
leave for the same length of time.

~~~
masterleep
Simpler solution. Let people make arrangements they want.

~~~
_delirium
Both approaches seem to work well in various situations, which is why I'm
skeptical of the value of these kinds of rants which lack comparative
analysis. Apparently it works badly in Hungary; but works well in Sweden. It'd
be more enlightening to read some analysis of the differences, since it
empirically isn't the case that strong parental leave policies always and
everywhere cause high unemployment, even if they anecdotally cause one dude in
Hungary to not want to hire women.

(I'd personally guess that culture and corruption have more to do with the
large economic differences between Sweden and Hungary than taxation or
parental-leave policies do, so I think he's barking up the wrong tree.)

~~~
droithomme
If it's really true that someone who just started work can immediately take
three years maternal leave off, fully paid, and then be due 2.5 months accrued
paid vacation time when they return, then I can't imagine how that could work.
I don't know if it really works that way in Hungary though, or in Sweden for
that matter.

~~~
lflux
In Sweden you wouldn't get 2.5 months of accrued paid vacation, it's more like
10 days, as the first 120 days (of 480) (pa/)maternal leave is counted towards
vacation.

Then again you have the legal right to take 25 days of vacation per year, but
not all of these have to be paid.

------
kcima
Governments like the one described in this article remind me of a massive
monolithic PHP program where all the functionality is lumped into a single
blob of spaghetti code. Ugh.

The negative impact of government regulations like this are proved by reducing
the size of a company to one.

Example: if you start a business, and hire yourself as the first employee,
should you be forced to give yourself 3 years off for maternity leave?

Of course you could never do this. It would kill your business instantly.

Just like the Unix philosophy of writing programs that do one thing and do it
well. Society functions better when we have many smaller social institutions
with focused roles.

Government doesn't need to do everything. There are plenty of other social
constructs that have proven more capable of providing many of society's needs.

Governments should stick to the task of protecting individual liberty.

Businesses should stick to the task of providing quality and innovative goods
and services.

Family, community, churches and private charity should stick to the task of
taking care of those less fortunate.

We as programmers and developers can help improve society by demanding that
(like our small but beautiful software), social institutions stick to singular
responsibilities to which they are most suited.

~~~
alga
If you want USA, you know where to find it.

------
blago
What struck me was the premise of the article. Creating a startup company by
selling your house is no walk in the park in any country. I can see a similar
article written about the US. Quit whining, there are other ways. If there
isn't a well developed capital market in Hungary, move somewhere else. Even in
the States, there is only one silicon valley and people move there. A big part
of the allure: access to capital.

------
viandante
I would just add that you can make money with such a system, you only need to
find a business with more added value (difference between cost and price). And
this brings to a whole lot of other topics such as if it is fair for a State
to raise the bar in such way, so that less added value businesses simply
cannot exist, if this improves growth and unemployment in the long run (I
don't think so). Etc.

------
rabble
For what it's worth, the same basic setup is in place in Latin America. Brazil
the effective cost is 2x the take home pay for people as well. Maternity
leaves are much shorter, and you can fire somebody, you just need to pay a
hefty severance. As somebody else mentioned, the way most companies work is to
have each developer with their own tiny company.

~~~
GFischer
Be careful with that, if the tax authorities find out it can be construed as
avoiding taxes (it's pretty complicated, but usually they'll find you in
violation of at least one tax law as it's almost impossible not to).

Starting a business in Latin America is tough. There are huge incentives for
tax evasion (and even when not, you might be evading unknowingly).

------
lizzard
This is why we need better legal and financial structures to create co-
operative, worker-owned businesses.

------
danbmil99
This is so, so true. Whether through pure rational amoral choice, or
subconsciously, every employer knows that some employees come with a hidden
extra cost.

In the US, maternity (+paternity) isn't crazy in most states, and I suspect
that's not a major issue. However, the fact that anyone but a white male has
potential cause to sue if fired (due to their ability to claim gender or race
discrimination), is a subtle but insidious reason to think twice about hiring
a woman or person of color.

The truth is that these sort of market-distorting regulations, while possibly
well intended, frequently end up hurting the people they are designed to help.

------
mavelikara
Sounds like a place where businesses are actively discouraged. I wonder how
the guy who (hypothetically) buys his €90K apartment made his money? Probably
from running a €9/hr shop under-reporting revenues.

~~~
alga
Na-ah. The €9/hr "competition" are students living on instant noodles. You
can't make a business out of that.

------
exor
I run a business and could relate so strongly, I registered for HN just to
comment: this is why I find it so difficult to hire locally in the U.S. - the
incentives make it so much easier to offshore work.

------
digitalengineer
The country of Hungary is almost broke. It's big, bloated government and
corruption that's the cause. Hell, the guy's post reads like Atlas Shrugged
and he's John Galt. He's "stopping the motor of the world" If you haven't read
it, have a look: <http://en.wikipedia.org/wiki/Atlas_Shrugged>

------
ricardobeat
> It's only Hungary that is so fucked up

That's because you're only looking at Europe. Come to Brazil for a show (minus
the huge maternity leave).

------
zeynalov
"Many of my employees would only come to work for me to learn my business
secrets and to steal my clients."

For that issue there is a non-compete contract
<http://en.wikipedia.org/wiki/Non-compete_clause>

~~~
andorjakab
Yeah, that's very nice when you have a working legal system. In Hungary a case
like this will take 5 years, and you will most probably loose. They can steal
your software, your artwork, your clients, your intellectual property, and you
loose the case. Absurd. Happens all the time, not only to me. Judges are
clueless in such matters.

~~~
zeynalov
Actually you're not alone. I have a startup in Azerbaijan, the same situation.
I divided the work between workers, they can't to the work alone, so they
don't know actually what they are doing. I teached the some parts of the
business, they do the mechanical work, without asking the questions. I also
made a non-compete clause between them for 2 years. Here are some tips from
other HN community for this issue:

1\. Split your workers into departments. No one single worker should handle
all the processes.

2\. Use forms to guide people through the process. It will make your processes
easier to automate.

3\. Take some upfront payment. That will discourage customers from dealing
with your employees on the side.

Another trick that I learnt from somebody else is to hold one key process to
yourself.

Someone I knew gets clothing manufactured in China. But before it is sold,
they do an adjustment to it that is not known to the factory.

Just as Coke has its "secret recipe", you have to make clear to your
freelancers that you have a secret step. It will be enough to discourage them
from running away with business.

\-----

~~~
andorjakab
Look, of course it's possible to find workarounds. But the issue is still
valid. There's a huge problem with work ethics. People too often feel they
have the right to steal whatever they like, unless of course I can stop them.
And the issue is still there. Our justice system does not do justice. I don't
want to create an 1984 work envorinment. I do want to trust the people I'm
working with. And if they - after signing all the good contracts - in an
environment that is built on mutual trust, they steal my property, I want the
justice system to do justice.

~~~
neuronotic
"people too often feel they have the right to steal whatever they like, unless
of course I can stop them." - so as long as _THEY_ are powerless (or
proportionately dis-empowered at least), _YOU_ can reap the upside of risks
taken where the downside has been externalised? Sounds like "theft" to me! Who
exactly do you want the justice system to do "justice" for?

Property is theft :p

~~~
andorjakab
Look, what's mine is mine. It should not be legal to steal it.

------
lalitm
pathetic reasons for not hiring women.

~~~
nosse
Maybe, but they are true. Small companies sometimes just don't have the money.
I heard about this hairdresser shop that was about to get bankrupt as four of
it's six employees were on maternity leave at the same time.

Ok it's rare occasion that 4/6 would reproduce at the same time, but if the
owner nice enough to hire mostly just graduated hairdressers, it starts to
look possible.

------
hodbby
Although each country has its own rules (maternity leaves, vacations, VAT,
etc...) but the problems are common share to all of us. Great post!

------
WhatsHisName
Based on the discussions I can't help but wonder how many people here
recognize that this article was written for Hungary and not the USA?

------
sirwitti
[EDIT]: if you downvote, please explain why.

i understand that depending on your country it maybe hard to create good and
profitable companies. i'm from austria, europe btw.

but on the other hand what to do with women and old people? i personally hate
the idea of selecting employees this way. if nobody hired old people and
women, someone, propably the state (read: everybody) had to pay for those
people.

for me this boils down to a greater question: how to deal with
work/life/family?

anybody here from a country with innovative ways of handling this?

------
OpieCunningham
_1- The competition sells the same service, but illegally, under really crappy
circumstances, charging €9 per hour. They simply pocket the money, without
even issuing an invoice, it doesn't even include the VAT. They don't have to
take any responsibility, there are no warranties, they officially don't even
do anything, there's not even an official, legal trace of their existence.
They don't have to rent an office, hire an accountant. By doing this 5 hours a
day, they can easily make €1,000. They would point their middle fingers to my
€760 job offer, where they wouldn't be allowed to do crappy work, but show up
in time every day and meet very high professional standards in their work,
they wouldn't be allowed to defraud the customers, and if they did, they would
be fired._

If your business plan calls for entering a market where the going hourly rate
(legal or not) is 9 and you want to charge 37, your business plan is seriously
flawed to the degree that every other explanation you've provided for not
starting the business is moot. You have no business plan and therefore you
won't hire anyone because you have no business. Find a new market.

 _2- The competition would do smear campaigns against my company. I would have
to face anti-capitalist propaganda, I would be seen as a greedy asshole who
charges €37 for what they charge €9, I would be an enemy of the nice Hungarian
people, while others work honestly for the fraction of my price..._

Without knowing what business you're talking about, it's hard to view this
complaint as anything more than irrational defeatism.

 _3- Many of my employees would only come to work for me to learn my business
secrets and to steal my clients. They would lure them by lying that they will
get the same value and quality of service, but at the fraction of the price.
After they stole enough clients, they would deliberately cause a lot of harm
to my company to get themselves fired. They would then go to court, stating
that I fired them illegally, and they would win the case. In the meantime,
they would of course work happily for the stolen clientele, that has cost me a
fortune to build up. And of course they would be offended. They would trumpet
on all kind of forums, that they have worked for my company, they know what
they're talking about. Not only it is very expensive, but the service is a
piece of crap too._

Granted, I'm entirely unfamiliar with Hungarian employment law, but this also
sounds like irrational defeatism, or at least a failure on your part to
understand best practices in documenting employee behavior. In addition, why
doesn't this cataclysmic issue affect the 9/hour competition?

 _4- Complaining about all this wouldn't help, no one would give a flying
fuck._

Complaining about real issues is one thing. Complaining about the market when
your business plan is pie-in-the-sky and everything and everyone is out to get
you is quite another.

~~~
andorjakab
1) You don't get it. Your competitors cheat. Illegally. They don't pay
customs, they don't pay taxes, they don't pay social security, and they get
away with it. No matter how good your business plan is, your illegal
competitors, who often shamelessly copy your otherwise excellent product /
idea / service will do it for 1/3 of the price. They simply have a huge, very
unfair advantage against us, who do business legally.

2.) This is personal experience, a lot of them, not a single case, and common
sense in Hungary. Happens all the time. Our goverment does it for God's sakes.
Read some Hungarian forums, and use Google translate.

3.) Because the €9 competition is mostly private persons. They don't hire
anybody. Court cases here can last 5-10 years. 3-4 years is very common. And
it really is very flawed. I tell you one example how intellectual property is
treated. My blogpost was published in its entire length maybe a 1000 times
without any permission, whatsoever. Including political parties. It doesn't
even occur to their mind that's illegal. The same thing happens if your
employees take away your client list, your software, whatever they can. You
just don't win the case at court.

4) I know how to do business, my business plans are perfectly sound. This is a
blogpost, with a fictional, generic scrap, so that everyday people get an
idea. But your comment basically proves me right. People generally don't care,
no matter if I whine. I can whine all day long, nobody gives a flying fuck.
Not my goverment, not my customers, not the justice system, nobody cares if
corruption kills my business. So, I don't give a job man.

~~~
OpieCunningham
_You don't get it. Your competitors cheat. Illegally. They don't pay customs,
they don't pay taxes, they don't pay social security, and they get away with
it. No matter how good your business plan is, your illegal competitors, who
often shamelessly copy your otherwise excellent product / idea / service will
do it for 1/3 of the price. They simply have a huge, very unfair advantage
against us, who do business legally._

You need to find a business which is less easy to copy and/or one in which you
can offer significant benefit vs. an illegal competitor. It's that simple. In
the U.S. we have an identical situation to what you describe in the services
industry: outsourcing. I need to charge X in order to survive as, say, a web
developer, whereas someone in India or Vietnam can charge 1/X for essentially
the same service. Now it's my decision whether to create enough benefit for a
customer to continue in that field, knowing that many potential customers will
simply outsource, or identify another field where I can provide a service that
is not as easily outsourced.

Competition is competition, in respect to your business plan the legality is
irrelevant.

~~~
andorjakab
Outsourcing is similar, but still very different issue. Agreed, as a web
developer you have to compete with worldwide competition, that may be
"unfair". Yes, you have to find a business plan, that still works. It's that
easy.

But nationwide local corruption is a different game. Let's say you run a small
restaurant. The guy next door opens one, and their menu is as good as yours,
but costs 1/2 of your prices. You can't match them, because of all the dirty
tactics. You have two options. Go out of business, or start using those dirty
tactics too, and then you become a part of the problem.

You can tell me there are other options, like, I don't know, turning my
restaurant to something completely different, but the principle still stands.
Whatever I do, if it's successful, illegals will copy it exactly, but sell
cheaper. It's just a question of time. It's a national sport.

It's the survival of the most corrupt (not the fittest).

------
swah
That's pretty much the same reason why Milton Friedman is against a minimum
wage stipulated by state.

------
dreamdu5t
Why are businesses forced to pay for maternity leave, and not taxpayers?

------
mcantelon
>our customers would pay €37 / hour for our service.

That seems low.

------
dr_win
my solution: get into business where you can hire machines, not people +
outsource the rest.

------
factorizer
people like these are what class struggle is for, amirite?

------
mp76
The links below present the governmental spending over the last 100 years or
so: \- this is partly in Romanian partly in English, but you should get the
point: [http://www.logec.ro/2011/12/12/ultima-prezentare-a-lui-
lesze...](http://www.logec.ro/2011/12/12/ultima-prezentare-a-lui-leszek-
balcerowicz-despre-cum-pune-statul-frana-cresterii-economice/) \- this is for
US only:
[http://www.usgovernmentspending.com/us_20th_century_chart.ht...](http://www.usgovernmentspending.com/us_20th_century_chart.html)

What these tell me in simple words is that, more and more, some smart asses
are taking decisions on our money. I really can't understand people arguing
this as a good think as I can't understand how 300-1000 (representing
government and parliement) persons do know better than we what we need. This
trend is taking more and more from our rights to decide how, when and what we
need. It also reduce the incentives to perform (as Jakab Andor put it in his
article) and increase the stimulus for free rides. It also increase the
chances of monopolies to develop with all the disadvantages that these are
bringing (as a side note, by Misses these are the only real monopolies).
Unfortunately, under current conditions, I don't believe this trend will
change any time soon and we (both US and EU) have a good chance of becoming
socialists with democratic hats in the next 50 years or so. This unless some
major shift happens, but most probably this won't be a nice and quiet change.
And, frankly, I'm not sure what freaks me out more: going in this direction or
hopping for a sudden shift.

Secondly, I think discrimination per se is wrong and not productive. However,
there are two contradictory types of laws that together increase the cost for
a company: the ones that punish discriminations and the ones that adds taxes
or additional costs for complying them. This leads to a natural behavior from
the business side to reduce their cost. So, in this case I don't believe we
are talking about discriminations per se, but about reducing costs in order to
compete in a given market. In this respect, I totally agree with him. Whenever
this conditions appears there's a good chance to create a black market. The
size might differ from country to country based on culture, public enforcing
power, the level o burden brought by regulation, but it will exist at some
extent.

Coming back to the example with pregnant women, I don't think it's fair to say
that we as a society want to stimulate birth, but "you" should bear the cost.
It would be much fair to have this done on the society cost not on a
particular business that have this case… for example, not by making the
employer keep the job (or bear any other costs), but by supporting women until
they get a job and perform additional activities to increase their changes to
get a job. I'm not saying this is what I would recommend, but I think it's
much better than the alternative.

However, I couldn't stop noticing that Jakab Andor only mentions to ways of
doing business (besides the "do nothing" option): struggle with a regular
business model with a small margin or cheat. These are both sadly choices. I
think he missed the "think bigger", at higher margins, be faster or smarter
approach.

------
tbsdy
Good. I wouldn't want to work for you, after all you seem to spend more time
writing about why you want to fire me than how to make money!

------
georgieporgie
This guy won't ever hire anyone because all he does is imagine the worst
possible outcome for a given situation with no eye toward actual likelihood or
his own ability to select a good candidate. Good luck with that attitude,
'entrepreneur'.

------
nestlequ1k
This guy is a complete asshole. Why is this #1 on HN?

~~~
vixen99
Anyone idiot or indeed a wise man can crank out an opinion or even cliched
abuse but don't you find it more interesting when they bother to offer a
counterpoint or an argument or pertinent further evidence regarding the
issue?.

------
teyc
While what he says may be true, without employees, his business can't scale.
What he is describing is the difficulty of startups competing against
established competitors who have a reliable source of revenue. In many
countries, smaller businesses get some form of exemption.

------
NHQ
More and more you are compelled to own the corporation that represents you in
business. So we can get around onerous government regulation. We are taxed to
pay for the private-public crony-capitalism complex. It may be costly or
unconscionable for me to hire you--or to be hired and paid as an individual
taxpayer--and let that money go freely into corruption. But we can hire the
other's company. How your company uses its money and treats its employees is
your business.

------
orbitingpluto
What a douche.

Guess what? People are messy. But more importantly, people are valuable.

The author can whine all he likes. But really, try getting something done
without them. Oh, wait, he says he's not going to even try... why are we
reading this?

~~~
geuis
It sounds like you didn't even read the article.

The author is describing a lot of negative legal aspects in his country that
make running a successful business nigh impossible.

~~~
orbitingpluto
I did.

The reason that the article irked me:

Imagine this combination: brilliant, an MSc in CompSci, being over 50, female,
not white, and an immigrant.

I tried to get her hired for the IT department where I worked. Instead she was
cheated out of her pay and fired before the standard employee trial period
ended. Standard practice for the place. (900 employees in four years, avg
occupancy of 50 workers, anyone mid-level and up is white only, and as soon as
a project was over almost everybody is fired, continuity of work is not the
issue).

I've heard all the same excuses before in a much friendlier business
environment. All in an attempt to treat people like they are not human beings.
I know nothing about the author and I'm not disputing the realities of
business in Hungary. But damn I want to shoot the message.

And a swath of downvotes in an attempt to do so is worth that...

