Gawker
Is anyone confused by all the fuss over freelancer benefits in the Viacom mess? Freelancer, permalancer, part-time employee, full-time employee: What's the difference anymore? Why are Viacom's independent contractors complaining about having their benefits cut when the general impression is that freelancers don't qualify for benefits in the first place? Where does the actual, you know, law come down on this issue? And do most media companies abide by it? Let's learn more!
The basics of freelancing: Contractors complete a piece of work in exchange for a fee, not a salary. They can't be bound by specific hours or be required to attend meetings or work at the office. Employers aren't actually required to provide health or retirement benefits to anyone. If they're big enough, most companies provide those benefits at some level in order to get and keep happy employees. But if they provide benefits to some employees, they have to provide them for all. And that's where it gets sticky, because many freelancers, whether they know it or not, fit the (maddeningly loose) definition of employee.
There is no legal definition for an independent contractor, but courts uphold the common law definitions of "master" and "slave." That's less fun than it sounds. Whether someone is an employee or a contractor is based on the amount of control their boss has over them. The implied relationship determines if you're a contractor or an employee, entitled to the benefits every other employee gets. Vague enough? Sound like you're in a relationship with a high-strung high-schooler?
You're Basically An Employee If:
None of these are legal definitions and many companies blur the lines. Newspapers and magazines, who often fill their pages with freelance work, occasionally set up "freelance stations," where a contractor can work, sometimes daily, without being given their own station and thus qualifying for employee status.
Not every employer is out to exploit cheap labor. In the media industry in particular, a company is hard-pressed not to use freelance workers. Many of the most ambitious contractors are young and happy to do the work for a byline or are established enough to want independence—both are attractive. Giving those people steady work or a few perks seems only natural. Unfortunately for employers, it also qualifies them for more.
In September, Governor Spitzer issued an executive order [PDF] establishing the Joint Enforcement Task Force On Employee Misclassification. Spitzer's order rattled the cages of a few media companies—the governor wants to look under rocks most of them would prefer remain undisturbed.
Viacom may have faced a choice common to media companies: eliminate benefits to independent contractors, or hire them on as employees. Take away paid vacation, company-provided healthcare and a retirement plan, and it becomes a lot easier to make the case that a freelancer is just a freelancer. Many newspapers spent the summer cleaning house in anticipation—those who haven't may find themselves in a bind.
Comments
Ok, so i am permalance...wtf is that.
Maggie:
You left out the "Dear Nick Denton," at the top!
I guess....like employee...but the perma means no and lance means benefits.
Ok, but what can you tell me about corruption within the coal mining industry of Appalachia?
When did Zach Braff start working for ClipArt?
This post managed to teach me a lot and absolutely nothing all at once.
Why isn't the Freelancer's Union all over this one?
I think I'm a bendylancer.
Am I the only one who's mildly shocked that the term "employee" isn't actually defined anywhere? Bueller?
The problem at Viacom is that, as a freelancer I have the same job title and do the same job as the staff employee who sits next to me. In fact, I have to cover for that person when they are on their paid vacation (!!!!!) There is absolutely zero difference between our job duties and our amount of responsibility.
So why are some employees given cush benefits packages and others get next to nothing? Btw, I work a desk job as a web producer and I'm here every day working the same hours, my job has nothing to do with on-air production.
This situation is crying out for a pie chart.
Okay, so let's see. So I:
...have benfits...
...work at this workstation...
...have some pens...
...carry the one....
...factor in sick days...
...get rid of the remainder...
...and...I'm..... drunk.
Yup. I'm drunk.
@PimpMyCouch: I think that's because it keeps getting re-defined. And not in our best interest, unless we are the boss.
@LolCait: Balk?
Academia trumpets its "freedom" from all of this. Instead, our guiding principle is Stockholm Syndrome. Also, many people I work with are ugly.
@preppylouche:
More please.
In my experience academic employment manages to combine all of the worst features of capitalism (winner-take-all stars v. everybody else), socialism (inefficiency) and feudalism (having to suck up to the lords of higher rank) all at once.
@Smitros: Have I taught you?
@Cesare_the_Somnambulist: But shouldn't there be a legislated definition of "employee" somewhere? Just on principle? Or am I just too naive?
@preppylouche:
Not that I know of, but I did spend some time in adjunct hell in a couple of places.
one idea -- that the Viacom permalancers band together and submit a slew of SS-8 forms to the IRS for a determination of their worker status. At the very least an IRS finding that Viacom has deliberately mis-classified the workers to avoid paying income taxes, Social Security and Medicare taxes, and unemployment taxes may provide Viacom with an expensive comeuppance. When I was in this situation -- (mis)classified as a "consultant" even though I worked as a full time employee -- I was dismayed to find that I would have to pay for all my employment taxes myself, including additional "self-employment" taxes. A favorable IRS determination may provide greater leverage than day-old posterboard (...and I love a good protest!). Check out [www.irs.gov],,id=99921,00.html
@FreeKitten:
sorry, that link didn't work. Just go to WWW.IRS.GOV and enter "Independent Contractors vs. Employees" in the top right search bar. It will give you all you need to know.
in general and outside Viacom, freelancers (FL) make far more than the static employee. this is rationalized by them paying their own healthcare and in some cases taxes. and they can bolt when they have too. in and out.
if you camp out for awhile (past a small proj. or whatever) you should be banking cash if you set your fee right.
Freelancers are supposed to be expensive. this forces the employer to "shit or get off the pot". Hire the FL or let them go after the project dies. they're too expensive.
the scuttlebutt is that Viacom pays notoriously low, mostly because people WANT to work there. those that didn't walk out, probaly covered there ass when they agreed to their day rate etc.
those that didn't, are screwed. but they can't rightly be pissed at Viacom for selling themselves down the river.
@Cesare_the_Somnambulist: or, Jeff Foxworthy cadence..."if you HAVEN'T been forced into a training room to to watch a video of a receptionist getting ass-patted, then my friend, you just might be a permalancer."
This has happened on the West Coast, too. I know in the past studios have fired staffers and then hired them back as permalancers. So the staffers were doing the same job as before, only with no benefits and with a much nastier tax bill at the end of the year.
This sort of thing happens outside the media/entertainment bubble, too. Not to sound like I've just wandered over from Wonkette or anything, but US job figures are inflated because of shit like this - a company will turn one well-paid full-time staff job into two poorly-paid full- or part-time freelance jobs. The company's bottom line improves, but employees get screwed.
@LolCait: Your unwavering commitment to drunk commenting is a beacon of hope in these uncertain, quitty times. Never change.
I hate to be the one to break it to you, but there has always been a sort of fuzzy definition for employee, especially when it comes to benefits and compensation structuring.
Generally speaking, until the early 90's there were three classes of employees at most white-collar firms: Management, Full-Time Salaried Employees, and Hourly Employees. Management determined the benefits offerred and decided for itself what it got, what scraps it gave others, and who got squeezed when the squeezing got done. At some point they moved HR from a 'how do we keep employees and get work done' to 'how do we get work done as cheaply as possible' and one of the bright ideas was to create another class of workers.
See, workers had been getting uppity for a while and suddenly you were EXPECTED to provide basic benefits even for your hourly employees and pay those employment taxes. So, HR goons came up with "Consultants" and "Contract workers", meaning 'People who do either Salaried or Hourly Employee work, but whom we can call something other than employee and therefore justify all sorts of fun stuff.
Now, here's where it gets GOOD. Management hires their friends as Consultants, gets them to come in and suggest that they increase revenues and cut costs to improve profits - yes, make more money and spend less and you'll have more money - and suggests that they make all sorts of jobs 'contract worker' or 'consultant' roles. The more jobs reclassified the better the payout for the guys at the top and the more people who will lose a good job with benefits and take contract work to make ends meet. Pretty soon a good benefits package is the sort of thing only offered to Salaried folks as the Hourly folks get cowed with the threat - the ominous and EVER-PRESENT threat - that they're in jobs that can just as easily be reclassified as contract worker jobs. Meanwhile, we convinced everyone that simply because you were salaried meant that there was no such thing as overtime. Management pay went through the roof and everyone else paid the price.
So, you've been sold out. Cardboard signs and cleverness certainly ain't gonna do much against a pretty systemic fucking. Y'all might want to consider something a little more forceful when they come with the chains and whips.
@FreeKitten: Most of the people who are protesting DO have those taxes taken out. They get paid on a W-2 like an employee but don't necessarily get the benefits. (Apologies to those who have read my explanation on other Viacom threads, but it bears repeating.)
No legal definition of an "employee"? Fuuuuuck! Terence Powderly, Samuel Gompers, and John L. Lewis are spinning in their graves.
Former staffer, now freelance employee here (with no benefits at all). I have to say that the 401K is something they were lucky to have as most real freelancers would never be offered that. Real freelancer = someone who works for multiple employers, not just Viacom. But that fact that they had it and are now taking it away is what really sucks. But you know what, take it, put YOUR money in an IRA or start investing.
Also, just go to the freelancers union for medical/dental. They're moving to Blue Shield and it's pretty decent. Yes you have to pay for it, but hey this is the freelance world, right? But you still have some power here. Since you are project to project, negotiate your rate to make up for the fact that you aren't getting paid holidays and will now be paying for your own benefits. You can do it! Stop thinking of yourself as an employee because they certainly have. Screw Viacom and their bottom line. Charge them what you're worth.
"F*** you, pay me." -Ray Liotta, Goodfellas
This protesting for an hour a day thing...not going to work. You have to be willing to walk away. Until all the freelancers are ready to do that, they aren't going to take you seriously.
Unemployed is easier to define: no job, no money, no rules.
i am kind of upset at the retarded responses here. i get that this is i "gossip site" but if you don't know what you are talking about, just stfu...for once.
thank you to the few people who gave meaningful responses about this issue.
@mattychicago: I, in turn, am kind of upset at your "kind of retarded" comment.
In fact, the employee vs. contractor issue is not even limited to the IRS definition (i.e. W-2 vs. 1099). The nebulous definitions of both terms, including in federal law outside of the IRS standards, keeps both lobbyists and attorneys (like me) in business. It's certainly the very opposite of surprising that there should be a ton of confusion among lay people about this issue; the system is set up that way!
If you had something meaningful to add to help the folks that are confused and are feeling screwed by Viacom right now, I wish you would have said it. I don't see how calling out people for their understandable confusion is at all helpful.
@DorothyMantooth: You met Wookie IRL?
And STILL no pizza with LolCait?
@Cesare_the_Somnambulist: No fish 'n' chips, either!
I am teh sad.
Also, yes. And Wookie is teh awesome.
@DorothyMantooth: I believe it.
Much luv to legal symantics...
So, your so cool and happen to be an designer, drafter, or a similarly skilled worker you can work as an 'employee' but still be considered an independent contractor. Odd.
I stick with the quick and easy rule: is the coffee free or does it have a "donation" cup next to it?
Not that I would drink it anyhow. I only drink coffee made from beans that have been passed through the digestion system of a feral cat. That's the real reason I'm bummed about those airport cats being evicted.
@DorothyMantooth: Good add, Dorothy, good piece, Maggie, good comment, Skippy. The truth is, folks, it is nebulous, and savvy employers look for loopholes to skirt a major area of cost--benefits and paid vaca.
1) The easiest tests are taxes and social security. If they're being taken out of your check, you're probably an employee, no matter what else you're told.
2) If you're given any benefits at all, score another point for employee.
3) If you are DIRECTED in your work--i.e., something beyond just completing one discrete assignment or particular job, something that happens day-to-day, across various areas of responsibility--employee.
Look for #s 1-3: they're indicia you're an employee.
Let's say they take out taxes, social security, you have some measly health plan and you get one day off every six months. But they call you an "independent contractor." If you signed an agreement that delineates what you do and don't get--well, that complicates it. You're a "contractor," maybe, although you still may be an employee. The boss is either dumb or evil, or both. You have to hire lawyer persons. Ick.
It is complicated, there are no easy answers, and it's why business gets away with so much. It's the U.S. version of lead pain on toys.
Another interesting story on this subject might be who treats their people well--are there any?--because nothing makes the trail boss nervous as much as the cattle heading off in another direction.
@KarenUhOh: Lead "paint," although "pain" sells it too.
@Conbon: That stopped when the coal industry started regulating itself, 'round about aught-one I believe it was.
Do freelancers at Viacom get unemployment if they're fired?
Also, when you're an employee, the company has to provide you with leave under the FMLA! And other federal rights! Honestly, I don't know why companies have any employees at all anymore!
Another common tactic of corporate america: when the role a worker will be perfomring is truly an employee role (and not an indep contractor role), bring your workers on as temps--that way you won't get in trouble for misclassiying them as contractors!
And I just love that, as a result of Gov. Spitzer's task force (whose goal is to prevent mistreatment of vulnerable workers), Viacom eliminated the benefits and paid vacation it provided to non-employees, thus bringing mistreatment to vulnerable workers who had not ben previously victimized! Excellent!
But...one note to you indep contractors out there...I hear if you set up your own business organization (LLP, Inc., LLC, etc.), and the payments are made from your employer--I mean company you work for--to that bus org (LLP, etc.), you can avoid some taxes/penalties. Dunno exactly how this works under NY law, but I'm just sayin'...check with your lawyer and accountant friends...
@Maujer: Generally contractors/freelancers do not get unemployment when they're fired...not having to pay unemployment taxes is just one more of the many benefits that employers enjoy by misclassifying employees as contractors!
Actually...no one gets unemployemnt when they're fired for cause, but employees can get unemployment when they're down-sized or "let go".
Does anyone have the number of a good labor attorney who'd consider taking on the case of the animation people who believe ourselves to be genuine employees? Or both groups, the permalancers and the animation staff? Please email me here, if so: animationbenefits@gmail.com
@ljnd2:
Because the Freelancer's Union really only acts like a professional association, offering group healthcare plans and the like. It doesn't do collective bargaining. For that, you're gonna have to go to one of the unions OR start an independent one.
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