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Freelancers – innocent victims of unfair labour laws and practices

Updated: Apr 20, 2021

The Covid pandemic has put many societal systems to a test. When considering how to go about the challenges we face, we have the excellent opportunity to think outside the box. An initial error that we often make is to depart from the industrial society's premises to address the challenges we face in the digital knowledge society. As Aristotle said in the Politics, "to start from an initial and fundamental error makes it impossible not to run into disaster in the end". That's where we are with the legal regulation of working life and social security where freelances, often artists, can feel like living in a Kafka landscape.

The Maltese cultural activist Narcy Calamatta observes that progressive countries have honed their social services and industrial-relations laws to a fine art so far. "However, they operate within the constraints of conservative traditional practices dictated by the free market and the supply-and-demand rigmarole." Calamatta advises us to think outside the conservative box and address people's various realities throughout their lifetime. There are few who today aspire for the proverbial gold watch after 40 years of loyalty to a single employer, he says. Neither are such possibilities available today on a large scale. Instead, we have a growing number of people engaged in activities that do not fit labour law's premise = employment. To remedy today's problems from this narrow premise is a fundamental error of the kind Aristotle talked about. To this, Narcy Calamatta can testify, seeing a universal basic income (UBI) as a solution that he elaborates on in the article What is Universal Basic Income?

"I am an artist in the performing arts. I know how the present world makes it impossible for talented artists in any realm of art to realise their full potential. Life becomes one long string of compromises, constricting the family or dependents of the artists to live a hand-to-mouth existence."

The Eurofound affirms, in 2020, the hand-to-mount existence freelancers face. 25 per cent of freelancers in Europe have no savings at all, whereas 30 per cent have just enough to last three months. Compared to employees or retired persons, freelancers have much greater difficulties in making ends meet, as well as more household arrears. This we learn in the working paper Creative labour in the era of Covid‐19: the case of freelancers. It is a welcome and much-needed survey of the effects of the pandemic for the creative sectors and freelances' problematic legal status, prepared for the European Trade Union Institute by Valeria Pulignano, Markieta Domecka, Karol Muszyński, Lander Vermeerbergen and Me-Linh Riemann in 2021.

Here more of their findings: Studies are unison in showing the devastating effect the pandemic has had on the creative sectors. The OECD reports in 2020 massive bankruptcies and rapid increases in unemployment. A report by Oxford Economics in 2020 estimates that in the UK alone, the sector has seen its gross value added fall by 25 per cent, corresponding to GBP 29 billion (USD 36.3 billion) and that one in five of those employed in the creative industry, have lost their jobs.

The measures governments have introduced to support freelancers leave much to desire. Freelancers' (lacking) legal status is at the core of this problem, revealing a lack of or limited entitlement to economic, social and labour rights. It is high time to give the problems freelancers face the particular attention they receive in the working paper. I had hoped to see a mention of a universal basic income as a remedy, but as far as we get is a mention that this "could include universal and generous basic income support". But it is, of course, the politicians' task to remedy the problems. Instead of trying to fix freelancers' problems from the misleading premises of employment, as now is the case, we need, like Alexander the Great with his sword to cut the Gordian knot. We, thus, need to find solutions outside the box. One principal solution would, thus, be a universal and unconditional basic income. Narcy Calamatta gives an indication of how easily this could be done, if the political will is there.

When Covid 19 hit the Maltese economy, the tourist sector, which accounts for more than 30 per cent of the Maltese GDP, was severely affected. The young prime minister, who had held his office for only a few months, asked his advisers for an immediate and novel solution for the summer months. The answer was to give each citizen 16 years of age and over a spending voucher of €100. 60 per cent should be spent in restaurants and catering establishments, whereas 40 per cent should be spent on clothes and household goods.

Calamatta elucidates. "Every voting citizen was given the same amount without any scrutiny or means tests. No-one was asked to prove this money was needed. The whole country was in a holiday mood and each person went on to spend more than the €100 allotted. Each euro spent did the usual rounds, in that the restaurateur had to buy his supplies and the supplier went out to celebrate, using his unexpected profits." The scheme was so successful that the government proposed a similar scheme in the November budget. "All political forces were in favour, because such a ready cash injection into the economy has served as yeast — to raise the rest of the economy to a new energy. I suggest a trial period of giving this €100 to everyone every week for a year and wait for results.", Calamatta says.

This is a beautiful example of the dynamic effects of a universal payment. That summer, 2020, in the midst of the pandemic, the catering industry and related tourist establishments reached high turnovers, some even matching the record figures of the previous year.

Narcy Calamatta pertinently points out that with a universal basic income, the citizen comes first. This is a decisive change of perception required to properly address the challenges we face, not only in the face of the Corona pandemic but also in working life in general. Calamatta insists that governments should look at the benefits of having their citizens realise their potential. He portrays artists with high potential as 'silkworms': "if you give them enough time and nutrition — UBI — to develop, they will produce silk-quality products. From among these you will get the occasional star singer or football player who generates sufficient income to keep hundreds of families afloat. You might also be nurturing a researcher, scientist or athlete who brings honour, gold medals to his or her nation and also an improvement to the lifestyle of their society."

Freelancers are an appropriate professional category to scrutinise to display the problems associated with labour law's narrow premises that are at odds with a growing number of activities in the creative sectors. Most freelancers in these sectors are solo self‐employed workers involved in various projects. The authors of the creative labour working paper, Valeria Pulignano et al., point to how the freelance status often is used as a strategic tool. Employers outsource work and frame it into 'projects' with the aim of reducing costs. By making their employees self‐employed, employers avoid social costs that a regular employment relationship implies. Thereby they avoid paying the minimum wage, circumvent working time provisions or bypass dismissal procedures. The authors make the pertinent point that, instead, this strategy has left such freelancers at the mercy of policymakers "implementing (or not) extraordinary solutions."

Valeria Pulignano et al. conclude that to offer real protection, national protection measures should be universal, adequate and easily accessible. To support those most in need, again, the support could include universal and generous basic income support, healthcare and a basic pension.

The working paper on creative labour has amply illustrated that governments have started from an initial and fundamental error when trying to remedy the situation for freelancers. "Not having a clear‐cut status 'not really an employee, not really a businessperson'" says an interviewee in the study. "Covid-19 has really highlighted the lack of rights that film and TV workers have and the government doesn't really know what to do with us either." says another interviewee, a graphic designer in the Creative labour study (2021).

Working life is fraught with serious human rights problems that need to be addressed. How to remedy them? We need to start with a legal redefinition of work, to take account of all activities in which people are engaged. A universal basic income is the first general step to remedy everybody's economic situation. This will provide a floor on which people should be able to stand to choose their plan of life, be it in the silkworm direction or any other one.

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Sources I've relied on:

Aristotle, The Politics, Penguin Classics, 1987

Valeria Pulignano, Markieta Domecka, Karol Muszyński, Lander Vermeerbergen, Me-Linh Riemann, European Trade Union Institute, 2021

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