Special Report

There’s A Good Chance Your Kids Will Be Freelancers — Where’s Their Paid Family Leave?

The Best Places To Work For New Dads identifies 59 businesses that take their obligations to employees seriously, first and foremost with paid family leave. These businesses are dragging the country toward something approximating a civilized social safety net, which is awesome — if you work for one of them. But what if you’re one of the approximately 53 million freelancers or independent contractors in the U.S.? Sure, you could theoretically stop working for a period of time to welcome your kid into the world, provided your savings account can absorb that sort of hit. Oh … right, fat chance.

If you’re Natalie Foster, a fellow at the Institute For The Future and co-founder of Peers, which provides benefits and protections for workers in the sharing economy (think Air BnB hosts, Etsy craftspeople, and Lyft drivers), you don’t just think that the current system isn’t working; you recognize that it’s woefully ill-suited to a workforce and economy undergoing a radical overhaul. Because businesses like Uber aren’t simply “disrupting” sclerotic old industries — they’re the tip of a spear that’s redefining what “work” even means.

Credit: Uber

Credit: Uber

“When we left the farm for the factories, we had to decide what the norms of work would be, and we did. Titans of industry, labor leaders, and politicians came together — and blood was shed — but we determined a workweek was 40 hours, there would be weekends, and that children wouldn’t work in the factories,” says Foster. “The traditional firms that brought us through the industrial age will look very different in the future, so it’s incumbent on this country and the titans of industry and labor leaders and politicians now to ask: What will the norms of work be when people don’t have one employer for whom they work from 9 to 5, 5 days a week?”

So, while you might read this report, get to work on 59 resumes, and figure you can make it all the way to retirement with an employer-matched 401K, there’s a strong likelihood your kids won’t be so lucky. What might benefits and protections look like for Junior’s generation? Foster is glad you asked.

It’s Portable And Universal
Last year, a group of sharing economy CEOs, labor leaders, and worker advocates like Foster drafted a series of principals illustrating “a new social safety net for the workforce of today.” The gist of their proposal endorses a suite of benefits and protections that can be paid for by different employers at different times (or all at the same time), moves with a worker from job to job, and is available regardless of whether or not the worker is salaried or freelance/contract. “With the big trends in the economy, paired with this rise in platforms [like Uber or Air BnB], it felt like the right time to rethink the social contract,” says Foster.

Credit: Instacart

Credit: Instacart

States And Cities Will Be Incubators
If you live in San Francisco and make less than $54,000 a year, Healthy San Francisco will provide you heavily subsidized health insurance. If you’re a freelancer living in California and pay into the state’s Disability Elective Coverage Insurance, you have access to paid family leave. In 1999, New York City established the Black Car Fund, which levies a small tax on every taxi or livery ride in order to maintain a worker’s compensation and disability fund for all the city’s drivers.

In each of these programs, Foster sees kernels of ideas that could be harnessed to bring similar benefits to a much wider swath of workers. “You could imagine Healthy San Francisco expanding to include disability or even paid time off,” she says. “The Black Car Fund is portable, so I can go from a taxi to Lyft or Uber and I’m still covered — that’s an example of a flat fee that these business build into their model, because they know what they owe.”

The Free Market Will Join The Fray
Maybe you’re wondering, “If this is such a large, thorny problem, why don’t those eggheads in Silicon Valley try to solve it?” According to Foster, they definitely are. In addition to Peers, she mentions 4 companies in particular who have made some headway:

  • Even: A financial service for hourly workers (and, eventually, freelancers) that tallies your average income, covers you when you fall short during a particular pay period, and reimburses itself when you exceed the average later on down the line.
  • Stride Health: A search platform designed to help non-salaried workers find the best available health insurance at the lowest cost, both on and off the exchanges created by the Affordable Care Act.
  • Sherpashare: A tool for sharing economy workers that helps them manage expenses and maximize income by facilitating communication and information between workers on similar platforms.
  • Intuit Self Employed: The tax software giant (and newly crowned 50 Best member) has an expanding line of software designed explicitly to help navigate the annual hell that is tax season for those with primarily 1099 income.

Labor Still Has A Role To Play
While unions are only marginally engaged with the freelance workers of the new economy, The Freelancers Union has tried to bridge that gap. It claims 300,000 members nationwide, mostly in creative industries like media and the arts, and mostly in the New York City area. More of an advocacy association than a traditional union, The Freelancers Union nevertheless offered its members health insurance before the Affordable Care Act made it cool to do so, and currently provides one of the only 401K retirement programs available to non-salaried employees.

Government_Fatherly

The Federal Government Is Not Off The Hook
While Foster is a big believer in what innovative business minds can bring to this problem — Peers was founded as a non-profit and eventually pivoted based in part on that belief — she doesn’t see the kind of sweeping change that will ultimately be needed coming from scrappy startups. “We don’t want to create a ‘high road’ set of employers that cost more; we want to lift all boats. That’s what policy does — government sets the rules and everyone plays by them. There have been some interesting partnerships set up over the years, but unless there is money funding benefits and protections for independent contractors, change won’t happen on a systemic level,” she says.

But don’t take her word for it, take President Obama’s — he called for increased paid leave and portable retirement benefits in his final State Of The Union speech. A month later, his last budget included $2 billion for state-level paid leave initiatives and another $100 million to fund experiments in portable retirement benefits.

Of course, that budget hasn’t passed congress yet, so whether or not this is a first step toward real benefits and protections for freelancers and independent contractors remains to be seen. In the meantime …. have you heard about all these great places to work for new dads?!

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