Protecting the worker in the gig economy

Sara Horowitz is in demand. The founder of the Freelancers Union, which has 250,000 independent contractors on its books, is struck by the attention from politicians and think tanks.

“In the last nine months every foundation has been having a ‘future of work’ conversation,” she says.

The trigger has been the growth of the “gig economy”, she says. Companies including TaskRabbit or Fiverr, which find freelancers for tasks such as home removals or producing videos, have crystallised the conversation. “It gives people legitimate anxiety when they see the race to the bottom [in terms of pay and conditions] of these micro-gig sites.”

The 52-year-old grew up in Brooklyn, where she still lives, in a home where workers’ rights were discussed over dinner. Her paternal grandfather was vice- president of the International Ladies Garment Workers’ Union and her father a union lawyer. Educated at Quaker schools, she “learnt you have to have the courage of your convictions and be a free thinker”.

Trained in labour and employment law, she has worked in the labour movement since she was 18. “I was a traditional labour thinker,” she reflects. Then as a lawyer, she became an independent contractor herself and it brought home the precarious nature of the work as well as opportunities that freelancing brings. It also convinced her of the need for a new form of unionism, one unfettered by the traditional link to specific industries.

There are 53 million freelancers in the US, according to a report released last year, commissioned by the union and Elance-oDesk, a site for freelancers. It represents 40 per cent of the country’s workforce. It also includes 14.3 million moonlighters (people in jobs, freelancing in their spare time). About one-tenth of this freelance population is temporary staff, working for one employer on a contract.

Historical comparisons are difficult as the collection of data on freelancers has been sporadic. However, the report does point to millennials, those born in the early 1980s to the turn of the century, as being more likely to freelance than older generations: 38 per cent of millennials compared with 32 per cent of those over 35.

Despite a background in labour politics, Horowitz is not saddened that the era of “big work”, as she dubs the 40-hour-a-week company job, is over. Freelancers are resourceful, she says. “They teach us the need to maintain a portfolio of work, [they] know they have to be connected with others.”

Moreover, their spending is more closely tied to their earnings than company workers: “They are not consumer pigs.”

Men can find the adjustment to freelance life hard. “When you’ve spent 30 years in a full-time job it’s very hard to adapt.” The autonomy, however, can be liberating. “It’s a more multifaceted life.”

There is, she detects, a difference in attitudes between the US and Europe. “In the UK, the talk is of the ‘precariat’ [the term describing a new proletariat, working in precarious jobs] and in Europe they want to fight it.”

Freelancing is the “new reality”, she says. “It’s here to stay.” The challenges are to adjust to episodic work and to organise the workforce.

In 1995 she set up Working Today, a non-profit organisation funded by the Ford Foundation and Robert Wood Johnson Foundation. Its purpose is to help form policy on work and changes in the labour market.

“It was really important to introduce this idea of the new workforce to politicians and other leaders. It also helped freelancers develop their collective freelance identity.” This became the Freelancers Union in 2003.

How can a freelance cleaner find common ground with a web designer? “It’s about realising we’re all facing this new economy and way of working together. [They] have a lot more in common than they do with the traditional cubicle dweller.”

One of the biggest problems for freelancers is pay: independent contractors undercut each other or even offer to work for free in exchange for such intangible benefits as “profile”.

“It’s really about creating an environment where all work is valued. Successful freelancers know their value and they stick to it.” This can be hard of course if you are a New Yorker competing against a software developer in Bengaluru.

The Freelancers Union has limitations when it comes to helping its members’ earnings. It is not a union in the traditional sense. Members do not pay dues and the Freelancers Union does not negotiate contracts with employers or intervene when a freelancer has a specific grievance.

The union was formed because freelancers wanted access to quality affordable health insurance. The Portable Benefits Network, which helped New York freelancers get group-rate insurance evolved into the Freelancers Insurance Company, which covers 25,000 New Yorkers. The model became the basis for three independent non-profit health care cooperatives, which received $340 million from Obamacare.

Unions have been slow to adapt to this workforce, she says. The point is conceded by Philip Jennings, general secretary of UNI global union, the trade union for 20 million service workers around the world. “Unions are realising the population of work is changing. But we’re in the business of survival.”

Horowitz believes there has been some regeneration in the labour movement, with the launch of the Domestic Workers Alliance in 2007 and the Taxi Workers Alliance in 1998.

The Freelancers Union is a model of the new economy, she says. There is a core staff of up to 35 employees and a network of freelancers and partners that work on a contractual basis for the union.

The biggest frustration, she says, is the slowness of those outside the commercial world to take on board the changes in the workforce. “Freelancers know this is the way more and more people will be working — and the fastest group moving into this space are investor-backed companies in Silicon Valley looking at freelancers as a market. The social sector and government have been much slower.”

It is disingenuous to see technological innovation as the result of brilliant entrepreneurs. “If you look at India, the reason it’s so good at IT is investment in education. Silicon Valley wouldn’t have happened without the investment in universities.

“We’re not making those investments any more. It’s so short term. The role of labour is to put those conversations on the table.”

Politics will change, according to Horowitz. “It’s not left or right any more. It’s all wide open.”

— Financial Times