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Freelancers Union to New York State: Stop letting independent workers get stiffed

Jessica Stillman — Fri, 27 Apr 2012 13:06:37 +0000

Citing a “deadbeat epidemic” that’s robbing independent workers of thousands of dollars a year, Freelancers Union is asking consultants and freelancers of all stripes to band together for their #GetPaidNotPlayed campaign protesting the unpaid invoices that plague freelancers. The aim is to spur the government to take action to protect the growing ranks of independents workers.

The campaign takes several forms, including “The World’s Longest Invoice,” an online tally of all the money outstanding to independent pros. According to a recent Freelancers Union survey, last year that sum amounted to an average of $4,600 for each of America’s 35 million or so freelancers. In May this massive invoice will be presented to New York State lawmakers in Albany to urge them to take action. The Freelancers Union hopes the final bill will exceed $1,000,000 to reflect the scale of the problem. Coworking spaces and freelancing websites also participated in a day of action yesterday to raise awareness.

The solution to freelancers’ payment problems is the passage of the Freelancers’ Payment Protection Act, a bill currently in committee in the New York State Senate, which could be used as a model for such legislation elsewhere, according to Freelancers Union and campaign supporters. “It’s model legislation that gives freelancers the same protection as ‘traditional’ employees – they can file wage claims for the money they’re owed and get protection from the Department of Labor. We are SO CLOSE to passing the bill and creating a historic precedent in New York that can be replicated throughout the country,” Althea Erickson, advocacy and policy director for Freelancers Union is reported as saying by Shareable.

What’s the alternative to reforming a legal framework which isn’t set up to handle the rise of independent work? For a heart-rending story of how terribly the current system can fail independent workers, check out the tale of Anthony, a creative freelancer in the New York area, whose battle to get payment for a six-figure invoice is recounted in DeskMag. It ended with him facing the threat of foreclosure and epic, time-consuming legal wrangling.

Do you have unpaid bills to add to the World’s Longest Invoice?

Image courtesy of Flickr user kozumel.

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Elance predicts the future of online work

Jessica Stillman — Tue, 27 Mar 2012 12:00:07 +0000

Online labor platforms are growing strongly, a fact that’s confirmed regularly when leaders in the field like Elance and oDesk release their latest impressive-sounding statistics showing more and more firms embracing online hiring. Today, Elance is adding to this drumbeat of optimism in the sector, unveiling figures that show more than $500 million worth of work has been contracted on the platform (for the visually inclined, here are the numbers in an infographic).

But where is all this interest in online labor platforms heading over the coming years? How will the uptick in interest in the so-called ‘human cloud’ shape business? In addition to statistics, Elance has also given GigaOM an exclusive sneak preview of three long-term industry trends it is predicting will shape the future of work.

One in three people will be hired online by 2020. The likes of Monster and LinkedIn are only the starting point when it comes to using the internet to find talent, according to Elance CEO Fabio Rosati. In future, it will be common for businesses not only to identify candidates online, but also to interview, hire and work with them at a distance. “The initiation of the search begins online already,” he told GigaOM in an interview. “The piece that we predict will be accelerating is the amount of hiring that will actually be completed online to result in an online working relationship. Within a few years, your ability to work remotely will be so extraordinarily compelling that we will literally not even feel the need to meet in person.”

Half of businesses will have online teams by 2020. Both a recent survey from Elance competitor oDesk and recent comments made to GigaOM by Gene Zaino, CEO of MBO Partners, have indicated that businesses increasingly see hiring contractors as a long-term strategy and competitive advantage, rather than a short-term stopgap or simple cost-cutting measure. Elance apparently agrees with Rosati explaining how more and more businesses will come to see the benefits of online hiring and come to view the practice as a normal, if not essential, business practice.

“We estimate probably less than ten percent of businesses have online teams right now. We are pretty much at the same stage where eCommerce was at the beginning of the last decade,” he said. “Around 2000 probably one in ten had a website and an online presence. By the end of the decade about half of businesses had an online presence and if they didn’t, they were planning to. We believe the same thing is happening to building online teams and having workers who work for you in the cloud. In the next eight years we’re going to see substantial acceleration of this trend and it will become a mainstream phenomenon.”

Global professional guilds will emerge online. It may be hard to imagine traditional labor unions surviving into a future featuring lots and lots of online work, but Rosati doesn’t expect that future independent pros will be left entirely to fend for themselves. Instead, Elance predicts they’ll band together in professional guilds. Citing the Freelancers Union and the Writers Guild of America, which went to bat for Hollywood writers a few years ago, as possible precursors and models to the phenomenon, Rosati explains that, “it’s easier than ever to create communities online. As online work becomes a mainstream phenomenon, the need for professionals with similar mindsets to come together and agree to guiding principles and what will be responsible behavior online professionally is going to emerge.”

He even predicts that these guilds could become a force advocating for the rights and interests of independent workers. “Independent professionals working online will coalesce around common standards, and as they coalesce and establish a united voice, I expect they will definitely play a major role in endorsing certain platforms and rejecting others. I think that we will see a greater voice and a greater influence,” he says.

What do you make of Elance’s predictions?

Image courtesy of Flickr user garryknight.

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Freelancers Union to expand health insurance offerings

Jessica Stillman — Fri, 24 Feb 2012 14:02:05 +0000

The number of independent workers is on the rise. That’s good news for professionals who want to control their own varied and interesting careers, but if you’re based in the U.S. being independent also comes with some significant benefits headaches, with how to obtain affordable health insurance primary among them.

But if independent workers live in New York, New Jersey or Oregon, they will soon have a new option when it comes to obtaining coverage thanks to the Affordable Care Act (aka Obamacare to its detractors) and the Freelancers Union. The organization, which currently has 170,000 members, was recently awarded $340 in low or no-interest federal loans through the Centers for Medicare and Medicaid Services to launch “consumer operated and oriented plans,” or Co-Ops that are open to everyone, including independent workers who typically struggle to find affordable coverage. The new plans will be non-profit and will be run by a local CEO and board of directors in each state.

The Co-Ops are set to begin enrolling members in the fall of next year and to begin offering benefits in January 2014. The Freelancers Union already covers around 23,000 workers and their family members in New York States through its existing insurance offerings, but anticipates covering an additional 200,000 workers across the three states within five years.

By cutting out the for-profit health insurance industry out of the equation, Co-Ops are intended to return insurance to its roots, in which workers pooled risk and supported each other. And by competing with private plans, the Co-Ops should also drive down costs for patients. “Co-Ops will promote competition in the insurance market and respond well to the health care needs of Americans,” according to Marilyn Tavenner, acting administrator of the Centers for Medicare and Medicaid Services.

“It’s like venture capital for healthcare,” said Sara Horowitz, executive director of the Freelancers Union. “By empowering nonprofit social entrepreneurs to compete with private insurers, Co-Ops provide a powerful new tool to bring more affordable options to the most people.”

Do you think the Obama administration’s healthcare reforms are the solution to independent workers’ health insurance woes?

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Do Health Insurance and Self-employment Mix?

Nancy Nally — Fri, 11 Sep 2009 16:00:29 +0000

In my Labor Day post, I talked about the importance of web workers advocating for ourselves, and why it is necessary. One of the topics for advocacy that is on everyone’s mind right now (at least in the U.S.) is healthcare, or more particularly health insurance. This topic is of special interest to the segment of web workers who are self-employed or work freelance.

What exactly is the current state of health insurance for the freelance worker in the United States? There are two key issues to consider: access and affordability.

If you are young and healthy by insurance company standards, you can try to buy an individual or family insurance policy. These policies are purchased as individual contracts from an insurance company, as compared to becoming a group member of an insurance pool that is contracted by an employer or other entity. Anne previously provided some tips about shopping for these policies.

There are a few ways that freelancers can get into health insurance buying groups to get lower rates. Some trade groups, local chambers of commerce, and advocacy groups such as the National Association for the Self-Employed offer discounts on purchasing insurance policies as a member benefit. These programs come with the restriction that people wanting to sign up must meet the health standards of the health insurance company to be eligible for the insurance. One notable exception is a program run by the Freelancer’s Union, which is only offered in the state of New York, and which accepts everyone who meet the group’s membership standards.

If you are self-employed because you own a small business, you may be able to get group rates (and tax benefits) by forming your own small group. You’ll need two or more people who are employees of the business to form a group in most states.

To purchase an individual health insurance policy, applicants have to go through a process called medical underwriting. The insurance company uses this screening process to evaluate the financial risk that you (and anyone else that will be on your policy) pose to them. After filling out your application and health history, the insurance company decides if it can insure you at all, and, if so, what rates it can offer you based on your financial risk.

A wide range of medical conditions can cause an applicant to flunk medical underwriting and be denied insurance coverage altogether. Other conditions can result in insurance rates being set ridiculously high; out of reach for most people. Medical underwriting is fairly standard across the industry, thus creating a class of people who are completely uninsurable in the private insurance market.

Some states have created government programs called high-risk insurance pools that sell insurance to people ineligible to purchase insurance through the open market because of underwriting rejection. These pools are expensive, though: members pay premiums that are usually capped at between 150-200 percent of the average market rate. The programs are usually subsidized by the state’s taxpayers. Around 30 states offer these pools, but the quality of the offerings of the programs vary widely.

Once you have health insurance, then you face the next challenge: keeping that insurance when you need it most. Individual insurance policy holders don’t have the protection of an employer group contract requiring the insurance company to insure them (called mandatory enrollment) to keep an insurance company from canceling their policies. This means that if you are a private insurance policy holder and you actually start needing your insurance, you may find the company using a process called rescission on you.

In health insurance, rescission happens when an insurance company wants to rid itself of a policy holder that is costing it money in large claims. The entire life history of insurance claims of everyone on the policy are examined in detail, looking for any pre-existing diagnosis that wasn’t reported on the policyholder’s application. It then uses this lack of disclosure of any condition, no matter how minor or unrelated to the current claims that are costing it money, to declare the policy void. Any diagnosis code for a chronic condition or risk factor ever recorded on a claim form by a doctor’s office could be grounds for voiding a policy if that condition wasn’t included on the policy’s application form. Forgetting to disclose your spouse’s deviated septum could be used as grounds to cancel your family’s policy if you need expensive cancer treatment.

There a few exceptions to all of these underwriting procedures and rescission concerns: if you live in Massachusetts, New York, New Jersey, Maine or Vermont, your state prohibits medical underwriting, according to ehealthinsurance.com.

I’ve personally experienced the effects of medical underwriting. I have multiple health conditions that are considered completely uninsurable by health insurance companies. Several times, when I have been cold-called by insurance agents who got my business registration information, I have literally been hung up on in mid-sentence the moment the agent heard the word “lupus” come out of my mouth. They knew they couldn’t sell me a policy so I was a waste of time and they moved on to the next prospect without even a polite sign-off.

Because of all of the things I described above, access to and the cost of health insurance should be a serious concern contemplated by anyone considering freelancing. It can prevent web workers from even being able to consider becoming self-employed, or force them back into working for someone else, because of the change in health status of themselves or a family member. For people who are already self-employed, maintaining health insurance is probably an ongoing concern. Last year, Mike reported that FreelanceSwitch research showed that only 31 percent of web workers in North America had health insurance.

Being young and supposedly healthy isn’t a reason to not worry about insurance. I was a young, healthy 18-year-old, right up until the day a blood test to determine if I had “freshman mono” diagnosed a serious blood disorder that is part of my lupus. Many Twitter users are familiar with the hashtag #blamedrewscancer. This meme sprang up after Drew Olanoff was diagnosed in May with Hodgkins Lymphoma and has become a LIVESTRONG fundraiser. Lightning can strike any of us in the form of a health crisis at any time. That is what insurance is for; if you can get it, and if you can afford it.

Do you have health insurance?

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