All Work And No Pay

Greed may be the quintessential sin of the Internet age, but recently a number of dot-commers have found themselves acting downright charitable, donating valuable time and services to needy causes. The beneficiaries of these individuals' newfound largesse? Their employers.

Confronted with increased financial scrutiny from investors, cash-strapped startups are searching for new funding, and the least secure among them are even asking workers to make due without pay. Exhibiting the usual dot-com defiance of common sense, workers are coming up with any number of reasons to stay: genuine loyalty, blind IPO faith or simple human inertia.

When's backers abruptly pulled out in late June, President and COO Tim Winter and his staff endured a week without pay. "Your first instinct is to find the next gig," says Winter. Though they could have just walked out the door, he and a skeleton staff continued working at a severely diminished salary until the company filed for bankruptcy in late July. "When you've poured your heart and soul into something for so long," says Winter, "it's hard to give it up." But not impossible. One former employee who missed "a few paychecks" this spring says, "I think a lot of people really believe in the company. I mean, helping parents raise their children - that's a pretty noble thing." Eventually, however, she voted with her feet and quit. "We are a private company, and this is a private matter," responds CFO John Buckley, who nonetheless doesn't deny stiffing workers.

But there are upsides, however limited, to being a startup volunteer. After weeks of hearing assurances that new investors - and back pay - are just around the corner, one unpaid worker at a troubled New York content site is making the most of it. "The balance of power has definitely shifted," the volunteer says, "No one's shy about asking for a week off anymore." And while the down-in-the-trenches camaraderie is wearing thin, the employee insists the company remain unnamed for fear of souring its chances of a bailout, and adds "we could go out and get other jobs - but we'd lose our options."

While content types are still chasing the IPO dream, businesspeople tend to have a more sober outlook on whether stock options in ailing startups will pay off. "We're so far underwater that we could wallpaper our bathrooms with those certificates," jokes FasTV's Winter. And at, where editorial staffers stuck it out for the site's well-publicized "volunteer period" in June, most of the business side bailed immediately.

Even when employees' charitable efforts turn out to be for naught, the experience isn't necessarily demoralizing. "It was pretty upbeat," says former APBnews celebrity-news editor Jim Edwards. "We were being very heavily recruited; the site was getting a lot of kind publicity." Edwards estimates that nearly all the site's editorial staff worked without pay for two weeks before management pulled the plug. "There was a definite sense of camaraderie," he says. But even with an employee's consent, withholding pay violates federal labor law. "If this was a Judy Garland movie - 'You've got a bar! I've got a piano! Let's put on a show!' - you wouldn't have to pay people," says Randy Wilson, a Labor Department spokesman. "But if you present yourself as a money-making corporate entity, hey, you've got to pay your employees!"

The employee volunteers realize they're not working for a money-making entity.

"Maybe it's denial," Winter muses. "One guy who's been coming in likened it to battered-wife syndrome: You refuse to leave because you believe you can salvage something."

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