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Freelance Work – Pros and Cons / Shuki Stauber

The freelance work model is gaining momentum in the modern job market.
The desire to preserve one’s independence, less need for permanent jobs and the rapid development of computers and Internet are the main reasons behind this trend. Meanwhile many organizations are trying to reduce manpower quotas – giving up fixed costs and buying work only as needed.
This article presents the freelance employment model from the perspective of both the employer and the employee.

Not long ago most freelance workers were writers, especially journalists. The word “freelance” originated in the Middle Ages when knights who possessed lances would hire out their services to the highest bidder. The word might have roamed to the field of writing because the pen is parallel to the lance. Today the term has come into wide use in a range of fields.

Freelance work is based on executing projects. From the organization’s standpoint this form of employment reduces expenses, particularly when it comes to fixed overhead. Many organizations also believe it saves them other employment costs such as pension payments, unemployment compensation, etc. (Sometimes this assumption proves wrong). On the other hand, this method does not allow the employer to obtain the level of commitment expected of a permanent worker. Sometimes the learning curve of a freelance worker entering an unfamiliar organization creates additional costs, both monetary and in terms of management resources.



Shuki Stauber

From the worker’s perspective the freelancer maintains his independence, is less reliant on a single organization and has more opportunity to work in a broad range of fields or focus on a specific area of expertise.

Still, many workers are deterred by the uncertainty of fluctuating income. The greater the financial needs the worker faces (e.g. a wife and kids to support, a wife who does not work outside of the home or who also works as a freelancer), the more inclined he will be to seek employment on a fixed basis.

One of the main reasons for employing freelancers is the unwillingness to form employer-employee work relations, with the accompanying costs and commitments. Many companies take pains to maintain total separation, sometimes artificially, between freelance workers and permanent employees.

For example, say a freelance worker has been operating for several months in close collaboration with a certain unit at the organization. The manager of that unit will want him to receive a holiday gift, too, just like the rest of the employees. But the human resources manager won’t allow it, not to save money but so this amiable gesture won’t be seen as a sign, as small a gesture as it may be, of employer-employee relations.

The importance employers attach to this separation is already conveyed at the time of the joint work agreement. Many employers make a point of noting it was made clear to the worker there are no worker-employee relations between the two sides.

This notation is inadequate, however, for on-the-job conduct is what determines the existence of worker-employer relations (e.g. the holiday gift above). Still, it does carry some weight since the issue of good faith is also taken into account. Thus if the worker agreed there would not be worker-employer relations his consent is weighed if later he files a claim to recognize the existence of worker-employer relations.

In summary, companies work with freelancers in one of two cases, which represent totally different managing strategies.
In one case freelance workers are hired to support the organization’s employees, primarily in areas that are not a part of its core operations, or areas that are part of the core operations but the company can only promise work for the duration of the project. In this way the organization, most of whose workers are permanent employees, reduces the risks of overhead and fixed costs.

The second case is organizations whose primary operations are based on projects, therefore for the very same reason – reducing fixed costs – they prefer to hire freelance workers. But unlike the first case in which these workers merely complement the permanent staff, in the second case the vast majority of the workers at the organization are freelancers, i.e. a relatively small core of permanent employees operate a large number of freelance workers.

Notable examples of this are the various media organizations that use freelance journalists and reporters, the publishing industry, which employs writers and translators based on the same principle, training institutions, etc.

 
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