My friend went through this. Worked for a company for ten years, then they laid him off... claiming they didn't have any work. They magically found the money to hire him back as a contractor a year later. They technically have to get rid of him and hire him back with a new deal every year or so. He has to pay for his own med and everything. Funny part is, they pay him more as a contractor than an employee. Typical corporate insanity.