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A guest blog by Gill Pavey of Wordhouse Writing Services
You know how it is when you start out. You’ve had months of small, one-off jobs but there’s no guarantee the flow will continue. On top of that, these clients have asked for your most basic (lowest fee) services so the jobs haven’t made a fortune. There are gaps in your schedule.
Then a company offers you a big contract and you think all your prayers have been answered. You sign on the dotted line and look forward to a harmonious, lucrative relationship for the foreseeable future.
There’s always a ‘but’. Before you break out the champagne and resolve to pay off your credit card next month, think very carefully about the consequences. The big client may be a wolf in sheep’s clothing, whether intentionally or not.
In most European countries the tax rules require some sort of evidence that you are indeed self-employed, and not a pseudo employee. It’s usually less about the taxation effects and more about social payments from yourself and an ‘employer’. Working for a single client, or one that makes up a large proportion of your income, may be viewed as employment rather than self-employment.
Back in the 1990s in the UK it was common to see large companies lay off their IT staff then take them back on as ‘contractors’ at what appeared to be a much higher pay rate. The Inland Revenue caught on to this and came down heavily, tightening up their own guidelines in the process.
Not only is a single or key client dodgy from the tax point of view, but you run the risk of having all your eggs in one basket. Your freelance business can also be smashed when the basket is dropped if things don’t work out with a key client. Over time conditions can alter that result in a contract termination:
While you are reeling from this, there’s more. One of the key indicators of being self-employed or an independent business is where control lies. This has become a major issue with big supermarkets where small producers are told what they will get paid, sometimes below cost price, because of the ‘take it or leave it’ attitude of the supermarket. Their sheer size gives them power.
Quite often a freelancer will need to accept the client’s offered fee although there may be room for negotiation. However, there are other types of control the freelancer should retain.
For example, a freelancer should be independent of any company rules about where, how and at what times the work is performed, subject to operational necessity and the law such as health and safety when on client premises. For example, a copywriting or editing client is entitled to set a deadline for a job to be completed, but has no say on whether you do this on your laptop from a beach in Spain, from your bedroom at midnight, or in the local café.
Most ‘rules’ will relate to the scope and quality requirements of the delivery. Demanding that you answer all emails within ten minutes, take all phone calls at whatever hour including weekends, do odd jobs for nothing or give their needs your top priority is not on. Add to that their insistence that you accept a poor fee and they are treating you as an employee, and not a valued one.
I read a blog recently advising companies to draw up a list of rules for freelancers and it was clearly inappropriate on many points. This included the implication that freelancers are all layabouts who are only in it for the money.
Needless to say, they will never be one of my clients.
Gill Pavey of Wordhouse Writing Services is a copywriter, copy-editor and proofreader with corporate and individual clients across Europe, the Middle and Far East.Current projects include academic papers and theses, commercial articles, novels and non-fiction. You can contact Gill Pavey by email or follow her on Twitter @WordhouseGill.