Do you hear that?
The sound of rain striking the windowpane.
The nervous steps of a disgruntled guy coming closer to your cubicle.
The phone ringing yet again.
You’ve had it. You’re pining for a change of scene. A little more time off work and a little less of your superior’s moaning would do wonders, you’re convinced. And that dress code, if only it didn’t exist. You’re dragging your feet when you’re supposed to race.
I understand you. The rat race kills the rat even before the hamster wheel squeaks.
I tell you what: leave the daily grind behind. It’s easier than you think. Imagine yourself sleeping in every day and working from the comfort of your home, clad in nothing but pants.
I know you want financial security. You want to continue to make money. On the one hand you could do with a freelancer’s freedom, but on the other, you don’t think you could have the same rights as an employee.
You can, but…if you’ve already tested out platforms for freelancers, chances are you haven’t even scratched the surface of what’s out there.
Let me introduce you to Peter’s story. At 40, this guy went location-independent and, to put it in his own words, he ‘freed himself of his also-ran suit and his suffocating tie’.
How Peter Ended up as a Freelancer
‘You know,’ Peter would say to me, ‘it’s always the same. You quit and hope everything is better in your new job. But a few weeks later you realise that nobody helps you familiarise yourself quickly. Nobody has time to show you the ropes, and what your predecessor has left behind is a mess.’
A computer programmer in his teens and self-taught in capital markets, Peter used to work at various investment companies as a stockbroker and trader for two decades. Five years ago, he was sick of staring at grey brick walls in front of his offices and tired of bosses that can never be pleased, as he says. Enough was enough.
He founded a multi-national business and was positive that life would become rewarding now. But then, the English technology entrepreneur experienced first-hand the inefficacies within recruiting. Wrong hires, wasted time and money. Again – something had to change.
Peter wasn’t alone. Failing to hire the right person isn’t an uncommon phenomenon in the UK. According to a new report from the Recruitment & Employment Confederation (REC), two out of five vacancies are filled with the wrong candidate, despite the significant financial costs of making mistakes. Apparently, it costs UK businesses billions each year.
As chance would have it, he met Sarah at BFI London Film Festival in 2016 – a managing director of a leading post-production and visual effects creative studio. That woman had been championing the diversity within the world of tech and visual effects and promoting the work of freelancers and independent workers.
Her enthusiasm for the world of freelancing was contagious. Peter felt compelled to do what he realised he’d long been craving and broke into the gig market – a decision he hasn’t regretted to this day, despite the increasing regimentation.
How Peter Felt After Taking the Plunge
In a word: free!
He revelled in his freedom to choose the kind of work that appealed to him, to determine when it was time to buckle down and when to knock off, to say no to a client he couldn’t be bothered to work with and to dress or undress the way he liked. Above all, he enjoyed working from anywhere, not just from London, New York or Bangkok.
Sounds good, but do freelancers roll in money?
Hold your horses!
Here Are a Few Facts and Figures
The gig economy is by no means all about badly paid driving or delivery jobs. On the contrary, the IPSE Freelancer Confidence Index report reads that the weighted average day rate for a freelancer is up to £525. According to RSA’s survey conducted earlier this year, only 16% are in the driving or delivery industry. 59% of UK’s freelancers are providing administrative, professional or creative services, and you can find freelancers across all occupations.
In other words, an overwhelming majority of UK’s freelancers are living proof that the gig economy isn’t synonymous with low-paid donkey work.
Okay, but what about late or no payment for delivered work?
You’ve got a point there.
According to a survey by fintech company Ormsby Street, about half of all freelancers have thought about giving up freelancing due to late payments. More so because of work they don’t get paid for, which happens every once in a while.
Even so, the number of UK’s freelancers has been rising and was estimated at 2 million in 2018. In the age of Brexit, lots of people don’t know what their employers are up to. Will they sack you, outsource or even close down? This insecurity is one of the reasons why the freelance community is growing.
Accenture and Deloitte both predict 30% of the UK’s workforce will be freelancing or gig working by 2020. In the US, this will rise as high as 50% by 2020.
So what are you supposed to do with poor payers? Chase them and risk losing those clients? Employment rights could be a price worth paying for, but becoming a ‘permalancer’ – a freelancer that works with the same organisation for a long period of time – has its downsides too.
In the face of the growing number of self-employed individuals and freelancers, alongside the much-documented rise of the ‘gig economy’, the UK government has announced that the Intermediaries Legislation (IR35) reform introduced to the public sector in 2017 will also be rolled out to the private sector in April 2020.
IR35 aims to tax ‘disguised employees’ who are working through their own companies and using the tax benefits that are available but are still working in a similar or identical manner to that of other employees.
If a self-employed individual is subject to IR35, the buyer needs to deduct income tax and national insurance contributions from payments made to freelancers. As the private sector relies heavily on freelancers, this reform is bound to have a considerable impact on the entire gig economy in the UK.
In a nutshell, for you to escape IR35, not only does your contract need to demonstrate that you’re in business, but also your working practices must show that you’re operating on your own account. This is a thorny issue, and the three key elements to consider are:
• control & direction regarding milestones rather than an open-ended pile of work
• personal service vs. the right to supply a substitute
• mutuality of obligation to provide and carry out work
Aware of IR35, Peter was looking for an umbrella company and stumbled across nodal.com this year. Not only does Nodal allow him to get the best deal while staying clearly within IR35 rules, avoiding one-off arrangements that might not stand up to legal scrutiny, Nodal is also the first blockchain-powered freelance marketplace.
‘Unlike other platforms, Nodal doesn’t charge extortionate commissions to freelancers, such as 20% on the first £250 earned with a buyer. Instead, they charge a small percentage to recruiters,’ Peter raved.
Protection from IR35 and the commission scheme aren’t the only aspects that exhilarated Peter so much. ‘The fact that timesheets are instantly recognised against invoices and payments are automated via ledger technology makes my life hassle-free,’ he said to me.
Since I’m a freelancer myself, Peter piqued my curiosity and prompted me to dig a little deeper. I’ve found that Nodal verifies and validates skills continuously. They record them whenever an action is completed, making the platform trustworthy, transparent and even-handed between employer and freelancer. That’s fantastic because it enables AI algorithms to match the right candidate with the right job, and guaranteed verification of skills slashes time and costs spent on wrong hires.
Instant access to a talent pool of candidates, peer ratings, date availability, smart contracts to put an end to the persistent issue of late payment and unfair scope creep, guaranteed weekly payments, incorporated insurance to all freelancers – all within Nodal – what else do you want?
Well, freelancing gets you out of the rat race and lets you travel more. Freelancing is the lifestyle that lets you control your workload, your work relationships, and the number of your breaks. You’re your own boss.
A better work-life balance, time savings, and less stress all contribute to more happiness. According to Upwork’s Freelancing in America 2018 study, 51% say that no amount of money would get them to take a traditional job. No wonder! Being able to work from anywhere is the epitome of freedom.
Doctors, social workers, fat pharmaceutical cats, blue boys in blue, rabbit breeders and other highly important contemporaries, everything I’ve said doesn’t apply to you. Take it with a pinch of salt and please continue to wear white coats, noble costumes and uniforms. Don’t even toy with the idea of becoming a freelancer. We need you, or hopefully we won’t.
Be that as it may, if everyone slept in and undressed at work, life would become pretty complicated again.
Philipp Meier is a Freelance Travel and Content Writer, Copywriter, English/German Translator and Proofreader. He has a passion for Thai culture and travelling off the well-trodden tourist trail in the Land of Cheeky Smiles. Find him at http://writerphilippmeier.com or via email at firstname.lastname@example.org.