Why EDB ErgoGroup Is Going Down – Big Time! (Yeah, I Won)

As you’ve all heard by now, I’ve been fighting ErgoGroup over missing salary payments from when I worked for them in 2009. Check the bottom of this article on the web for the full series of events.

You may also recall that we’ve faced off in court and I’m here to present the results and plans for the future.

First of all, and most importantly, ErgoGroup was slashed down in court. Yup, I won, I was right all along, and ErgoGroup now officially and as determined by law tried to screw me over. 

The judges said, plain and simple, that ErgoGroup made the mistakes and that the responsibility lay with them as the professional party in this case. ErgoGroup was sentenced to pay, no more, no less.

However, what the judges didn’t agree with me was the sum I should get. Despite documenting the claims in detail, the judged reduced my claim by about US$5K.

I’m not happy with that, because my pledge is to fight until ErgoGroup has paid every cent they owe me. As such, I’m contemplating appealing the decision to a higher court, the District Court of Oslo, to get my money.

Oh, but that’s not everything. It gets much, much better. Or worse, if you’re ErgoGroup.

You see, as I explained in a previous post, I am confident that the contract they gave me is illegal. In short, Norwegian precedence and laws require that taking a risk should also include a possibility for reward. The bonus contract that ErgoGroup had only stated that if ErgoGroup didn’t make enough money, then every employee would forfeit their payments. If, on the other hand, ErgoGroup made several truckloads of money, employees would still get only what they were promised, with no possibility for additional reward.

Because I don’t want to reveal all the details about what exact claims and laws I’ll use, I won’t go into further detail here, but I’ve spent days and nights scouring past cases and laws to make sure I win when the case comes up in the District Court.

Let me explain how the bonus scheme in ErgoGroup works.

Want to Get $10,000? Read On!

Here’s how this will work: I’ll hire you to work for me, for $10,000. You’ll do some task, doesn’t really matter for this explanation.

So far, this sounds like a fairly straight-forward working contract, right? You do some piece of work and get paid for doing that piece of work.

Here’s the twist: you won’t get paid yet. In fact, you may not get paid at all.

Next year, if I have a good time, determined by having more than $20,000 in the bank, I’ll pay you for your work. If I don’t have $20,000 in the bank, you get squat for your work.

That’s right, if I waste my money, you get nothing, but if I save, you still only get what I promised you.

Because there’s a chance I won’t pay you, I’ll call what you get ‘a bonus’. After all, if there’s a chance you won’t get paid, then getting paid is a bonus, right?

So, you’re risking your pay for your work, based solely on whether I do well. That’s the risk part.

Note: Contrary to ErgoGroup, I’m actually telling you this up front. They didn’t tell me until after I quit the company when they refused to pay because I quit.

Oh, and in this case, you’d get paid $4,000, but would still gamble with $6,000.

You’d expect that if you’re taking such a risk, there would be a huge reward as well. After all, if you gamble with all your money at a casino, there is at least a chance you’ll walk away with more money. If you put all your money in the lottery, you’ll have a chance in a million that you’ll win big!

Not so with ErgoGroup’s model. You take the risk, but can get no reward. No matter how well ErgoGroup does, you only get what you’ve been promised as a salary. If they make billions, even if you’re the one making them all that money, you just get your salary.

That’s risk with no reward, and I believe it is illegal.

So, when I do go to the District Court, I’ll claim an additional $500 for the risk ErgoGroup forced me to take with my bonus payments.

What? All This Over Just $500?

Well, it’s not just a matter of me. If the contract is illegal and I win in the District Court, every bonus contract for every employee over the entire lifespan of that bonus system is also illegal. ErgoGroup had 3.000 employees who were under that contract for more than three years. My $500 is only for five months, so if you scale that number to 3.000 employees over 36 months, you’ll reach approximately $10.8 million, and yes, that’s in US$.

Even worse, because ErgoGroup just a couple of months ago merged with another IT giant in Norway, a publicly traded company, the combined company EDB ErgoGroup is now traded at the Oslo Stock Exchange (OSE: EDBASA).

On October 19, the combined EDB ErgoGroup presented their third quarter results, with a profit of approximately US$33M for the year so far. Because a risk of over $10 million would seriously impact the bottom line of the company, if nothing else, EDB ErgoGroup must inform the stock exchange about this case, bringing further shame to their already tainted reputation.

Actually, since my rate of bonus payment was very high, the number would be lower, but would still be several million US$, even if the average employee would get only a third of the bonus I was promised.

Of course, their shareholders won’t be pleased with that either. This won’t affect their bottom line, but I can assure you that the thousands of shareholders won’t appreciate their money being flushed out the window, just because EDB ErgoGroup tried to screw me over for a few thousand bucks.

There’s a second concern here too. If I win my claim, ErgoGroup risks falling below the magic ‘no-pay’ barrier that I’ve described earlier. Considering ErgoGroup was losing money before the merger and that the combined EDB ErgoGroup company also lost money in Q3 and have huge costs this year related to the merger, there’s a very good chance the company won’t make enough money to reach that barrier where employees get paid.

What that means is that every employee risks their bonus payments for 2010.

If I were those employees, I’d either quit on the spot or at least I wouldn’t work another hour until that deal changes. Effectively, those employees will be working for free for as much as several months of the year, depending on how good they are and how much bonus they would have gotten. For me, considering I would get approximately 60% of my salary as ‘bonus’ it would mean I would work from the middle of May through December 31 without getting paid.

Winners take the fall in ErgoGroup, but you already knew that.

So, if I were you, and you owned stock in EDB ErgoGroup, I would sell, right now, before even more shit hits every fan I can find. If I were you and I worked in ErgoGroup, I would question whether I was willing to work that much of the year for free. If not, I’d get the hell out of there.

If, after consulting with my attorney, I decide to take this further, the press releases go out as soon as I get the receipt from the District Court.

You ain’t seen nothing yet.

.b

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Bjørn Furuknap

I previously did SharePoint. These days, I try new things to see where I can find the passion. If you have great ideas, cool projects, or is in general an awesome person, get in touch and we might find out together.

3 thoughts on “Why EDB ErgoGroup Is Going Down – Big Time! (Yeah, I Won)”

  1. I guess people don’t mind commenting your story any more because they are tired of you complaing and not quite understand the issue as you describe it.
    Good luck in spending time on writing 🙂

    1. Anonymous,

      Oh, I get comments, allright. Most people, however, don’t need to hide behind perceived anonymity to voice their opinions. Oh, and in case you didn’t realize, your IP is showing, even if you are posting comments from your mobile phone.

      .b

  2. As a fellow self-employed IT professional, I applaud your refusal to be mistreated by an employer and congratulate you on your success.

    It seems to me that you have reached the point that you have a moral “win” and should probably move forward with your career and your life and put this behind you. To continue to pursue this in such a public and antagonistic fashion makes you less appealing to prospective employers and clients.

    Good luck.

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