Some folks in charge of companies just don’t get it…

And when they give orders that aren’t necessarily good for business, it can really come back to bite them!

Check out what happened in this story from Reddit when a worker’s boss gave them some bad directives that cost the company a bundle of money.

Start now!

Director said process contracts faster and don’t fuss over details. Okay, you’ll lose bonus.

“I work with a federal contractor responsible to buy or bundle hardware, software, etc. .Any gov’t organization needs and reviews the contract in terms of financial viability and legal clauses.

In other words, ensure we make money and we are legally covered. The contracts range from $5k to $40M.

LAST YEAR

Our company went through a re-organization i.e., fire people and give more work to people still left with the company while paying us peanuts.

We are a small company with less than 200 employees and trying to retain our government customers while big companies like Amazon Cloud will replace us in less than 10 years.

The government customers love working with us because this is the only thing we do and treat the customers better than big contractors who don’t care.

The work was piling up.

They laid off 30 people from my team of 50. So now 20 people do the work for 50 people at the same salary. We are paid by the month and not work hours and we don’t get sales bonuses (important to the story).

I have a habit of reviewing everything carefully and spending hours on each contract even one that just makes us a few thousand dollars. Gov’t vendor selection process is slow and they are VERY risk-averse so a lot of customers start at a few thousand dollars and end up in an 8 or 9 figure contract if everything goes well.

Since people were laid off I was struggling with the work volume and as a result, contracts were piling up. The sales director i.e. different team did not like me as I was slow and also catching any tricks the sales team tried to play by over-promising the customer or something shady.

Government clients/customers loved working with me, the support I provided, and was truthful regarding our capability and our drawbacks. This was something else the director disliked me for since he thought I am tanking sales. However, almost all my clients were repeat customers for over a decade.

Example: Sales wanted a school district to buy outdated Dell Windows laptops while the entire state was moving towards new cheaper ChromeBooks. Schools don’t have budget and whatever they buy stays for 5+ years.

Sales were offloading expensive useless stuff to get better bonuses and also charge customer nearly a million dollars to provide “IT support” for faults arising from ancient hardware.

They tried to tell them…

During my conversation with the school district I shared examples of state governments in the northeast buying ChromeBooks and saving money while future proofing the hardware.

It’s my job was to get the best quote to customers and develop trust to sign a 5 or 10 year contract. So, this school district bought Chromebooks which were 40% cheaper and had less than 20% of the previously quoted IT support cost. As a result sales team lost a few thousand dollars in bonus but we brought this customer with us for a 5 year contract.

The sales director got mad as I was working on small contracts at a slow pace and reprimanded me in front of our manager. The manager did not care and did not defend me and asked: “why don’t you follow what the sales director says and stop fussing over small contracts?”

Well…

I said small contracts turn into big ones hence I should pay attention to them as well. Mistakes in small contracts could harm us if the contract becomes big. I am struggling at work because you gave me the job of 3 or 4 people.

At this point he was shouting at me that I don’t understand contracts, he has been doing this stuff for 5 years and he makes more money in a month than I do in a year so I should listen to him and not question him.

This was a bit insulting as I live in a shared apartment and am struggling to make ends meet while he drives an expensive luxury car and just goes out on fancy lunches with government employees.

I asked the sales director to send an email with a list of “suggestions” to improve my work. He rudely complied and said “Can you not even remember what I just said in the meeting?”

His email said “Do not review contracts less than $100K and “trust” sales team that due diligence has been done”.

I replied by copying my manager in the email that this could create liability in the future and want him to confirm again that the sales team will do financial and legal compliance themselves for the small contracts and I need to stop revising small government contracts below $100k with no exceptions unless told otherwise.”

This was gold.

You got it!

Cue Malicious Compliance.

Instead of 2 hours, I spent 10 minutes on small contracts, and the backlog cleared and I am home by 6:30 PM. Now, a contract worth 10K comes through I found some issues with this contract since it said that we offer 30% rebates to our software providers.

This was something we stopped doing 5 years ago and now we just offer software providers a 5 to 10% rebate on contracts. Also, I knew the government client recently got a massive budget and was on a spending spree (part of my job).

There is a high chance that this $10k customer will become a $100M and the 30% rebate means we have to give $30M on top of the usual cost. But I remembered what the sales director said ‘why don’t you follow what the sales director says and stop fussing over small contracts”.

So 10 minutes later I email “No issues detected based on compliance check by the sales team.”

As I mentioned government contracts are slow, no one cared/raised the 30% rebate issue since it was just a $10k customer.

10 months later the state government customer said they want to work with us and get at least the same terms or better terms for a new $50M contract.

This was the largest contract in our company’s history.

The sales director happily gave him a handshake deal that we will offer the same or better terms. Government can legally just buy more on their current contract so the Sales director had no issues promising the same terms.

Given contract size, everyone from legal, IT, and finance gets involved to work on just one contract. For 3 months everyone worked on one contract.

People were excited about this.

The sales team was giddy that they will get million-dollar bonuses. I don’t get a sales bonus to ensure I protect customers and the company.

The finance team finishes their review and said the company is going to lose $8M and not make any money. Everyone is shocked, the sales director gave a deal without checking with us and we cannot go back on something we offer.

Changing contract terms is frowned upon by the government and they have legal contracts stating “NOTHING WILL CHANGE”. We are legally obligated to offer the government the same terms for 3 years. The legal team says we need to take a hit on our balance sheet and swallow the losses.

The CEO called a big meeting in a fancy conference room with big TV screens and everyone had to find a scapegoat to take the blame. Every department lead, managers and people involved in this contract were summoned.

The sales leader had to explain to his team why they won’t get bonuses on this big contract they spent over 3 months. Finally legal and finance meet and share their findings we lost money due to the 30% rebate clause.

The sales director goes crazy and blamed me in front of everyone and asked me to pack my stuff in front of 30 people. Follows by saying I am terrible at my job despite 100% customer satisfaction.

They put him on blast!

I calmly opened my laptop and connected the display cable and opened Outlook while displaying his email on 3 big TV screens stating that I should stop reviewing small contracts. While all 30 people read the email with a faint smile I await the sales director’s reaction.

He goes into rage mode claiming I misunderstood his email and am terrible at my job. Then I scroll down where he ignored my warning regarding potential liability to the company and his response explicitly asked me to ignore that.

His face turned white when he realized he messed up. He then blabbered trying to find some other scapegoat making racist tirades against our IT consultants in Vietnam and just lost it.

Aftermath:

I was told to spend 2-3 hours on each contract and the company eventually figured out that it is cheaper for them to hire 20 people like me and pay us $70K every year than to take big losses on their contracts.

Our team has 40 members now, still less than 50 but enough to offset the contract volume. Because of the losses sales director had to pay back his previous year’s bonus as he had a clawback clause with the company i.e. if you screw up you need to pay us.

The sales director had to pay nearly $300K and was fired from his job.

PRESENT-DAY

He then sued our company for wrongful termination and we just heard today that he lost the case and now owes us another 200k legal fee. Now he owes over half a million to our company.”

Reddit users shared their thoughts.

This person weighed in.

Another reader spoke up.

This individual shared their thoughts.

Another person had a lot to say.

And this Reddit user spoke up.

Well, that wasn’t a very smart move, was it?

If you thought that was an interesting story, check out what happened when a family gave their in-laws a free place to stay in exchange for babysitting, but things changed when they don’t hold up their end of the bargain.