According to a report published by The Guardian, Google was illegally underpaying thousands of shadow workers around the world, and instead of correcting this error, the company neglected the matter for more than two years in attempt to cover up the problem.

Moreover, the New York Times revealed that since late December managers at Google discovered that the company had been underpaying some of the shadow workers for years. Google was violating local laws that oblige temporary workers to be paid equivalent rates to full-time employees performing the same job in the United Kingdom, Europe, and Asia. 

So why did Google cover up this violation? Google claimed that increased costs to departments relying largely on shadow workers, future legal exposure, and fear of the negative reaction to the press are the main reasons that drove it to take such a decision. 

How will Google fix the situation? The company said it was going to fix the error by applying corrected pay rates for new hires who've begun 2021 while retaining costly wholesale adjustments.

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In an email to the colleagues, Alan Barry, a Google Compliance Manager in Ireland, said it was the right approach from the legal point of view to alter the rates for all their time. This would, however, raise the probability that the existing shadow workers of Google personnel can connect the dots regarding the reasons behind the bill and legal and ethical difficulties for the employees supplying and paying agencies.

What about the shadow workers already employed by Google? Google recognized the failings and stated it would start an investigation.

"Although, for several years, the team has not increased the comparator rate benchmarks, the real pay rates for temporary personnel have increased many times throughout this period," stated Spyro Karetsos, Chief Officer of Compliance for Google. He added that the majority of temporary staff is paid much more than benchmark rates.

What happened next? In June, a whistle-blower complaint to the Securities and Exchange Commission exposed Google's choice not to promptly fix pay rates for all current time. In 16 countries with pay-parity laws, Google may, according to the complaint, owe over $100 million in back salaries over nine years of lack of compliance. 

Google employs more than 150,000 workers and contractors, while Google's parent company, Alphabet, has 144,000 full-time staff according to those familiar with the figures but are unable to divulge the data publicly. Google says temporary workers represent approximately 3% of its permanent employees.