In the defense and aerospace industry I've known - and continue to know - a number of engineers and specialists who do this. Leadership will often turn a blind eye, because the particular skill is so specialized, they'd need to give up a product line (or the whole business) if they terminate the guy. But, this being a very sick industry, they can't actually pay the guy more, so you get these terrible arrangements.
Since the eighties we've generally trended towards executives making awful decisions in service of the great number in the sky - irrational and arbitrary layoffs, consistent undercompensation, wealth hoarding, underinvestment in long term profits... these are all common place or expected in your standard 9-5 corporate America job.
Yes. If some people get more, other people will ask for more and the company can't ^H^H^H^H won't afford that, so better to lose a few individuals than pay everyone more. So, if you're a project manager, you sometimes need to turn a blind eye to make things work for you.
There are pay caps that do not correspond to reality, and you often don’t need such capable people for 40+ hours a week. When I consulted I explicitly told my clients that they do not need me full time, and I will have two clients add spend half of my time each week on each. I billed each client half my full time amount. Whether their accounting department knew all that is none of my business.
Unless of course one steals company secrets or something, why do they feel the need for exclusivity in the first place?
It's so that they are dependent on them and they have the leverage.
It's also because no matter what he delivers and how happy they are with it, they always think they could have pushed him to deliver more, if they squeezed more of his hours.
Like a crappy restaurant owner who makes the waiters also mop the floor or do whatever when no patrons have arrived yet, because they can't fathom paying them to "sit".
The pay scales are locked down by two primary components: 1) the project contract document locks charges pretty severely for the project, to the point where a single high pay scale putting in hours will probably require a revision to the charges, but more importantly, 2) the owning Big Defense Conglomerate has armor plated pay ceilings for non-managerial employees - non-financial technicians are interchangeable cogs, that's the doctrine, regardless of any particular realities of skill shortage or availability.
Disregard what the Overlords might tell you; 2 is way more important, because when it comes to 1, the military program offices are VERY open to revisiting the charge schedule, if it means they get transparency and a better chance of something that might work. Those non-managerial pay ceilings were laughable pre-Covid, and now it's gotten just surreal, still based on a flat national average of what they consider the job role to be, something that's also gotten surreal, with Kinkos employees being included in sw engineer pay codes.
It's worsened by the fact they can't really take advantage of remote workers, somewhere with less CoL, in Alabama or Pakistan or whatever. Everything's on site, and it really does seem like every defense company I've ever worked is sited in some random shitty place where the local economy - if there is one - is composed of the company and three Applebees-like chains that service it.
Employers in this industry could pay more out of overhead but then their numbers wouldn’t look as good as their competitors, the stock would underperform, and access to favorable credit terms would be restricted and in an industry with such astronomically (heh) high capital costs that’s very bad.
Most defense industry contracts are awarded to the low bidder, so contractors underbid just to continue operating. But then that leaves them without sufficient revenue to pay market rate wages to employees with the specialized skills to deliver on the contracts. Most defense companies still manage to muddle through somehow but it's messy.
Contracts where all profits scale 1:1 with costs are a relatively small slice of total spending due to obvious poor incentives.
Fuel and similar commodities may look kind of like a cost+ contract, but it’s market price + X$ not market price * some profit margin so the incentives are different. It’s a net win for both sides if such variables are removed from the equation.
