What good did the Microsoft Permatemp suit do?

Absolutely none for anybody except for the temporary agencies that handle the hiring.

Let me give you an idea of what would happen for us as a result of the Permatemp suit. We would advertise the positions, interview the applicants, and tell the temp agency to hire them for us for a nine-month stint.

Then, even though we selected them, we would pay a $10,000 finder's fee per employee to the temporary agency. We would pay the $10,000 finder's fee even if it was a rehire.

What did Microsoft get in exchange? Microsoft wouldn't have to pay for medical benefits, group activities or for stock benefits. Microsoft would still pay for floor space, hardware, free drinks, meals, etc.

Now, we kept bringing the exact same people back every single year. After five years, the cost of their benefits would have been significantly less than the finder's fee.

So why did Microsoft keep paying the extra money? The only answer that I can think of is public perception. Dropping 700 a-/v- (aka temp) employees is a business move. Dropping 700 FTE's is a layoff. Nobody wants to hear Microsoft use the "L" word. It's not good for the stock.