When “Independent Contractor” is just another word for Nothing Left To Lose

In case it is not entirely obvious, I am not sanguine about the shift away from true employment towards a workforce of self-employed independent contractors. According to the website Freelancers Union, “Nearly one in three working Americans is an independent worker.” (see http://www.freelancersunion.org/about/)

If you are a new freelancer, you may not know in advance the difference between working a W2 job and a 1099 independent contractor job. So here’s a rough guide.

Things you get when you are an independent contractor:

  1. Flexibility also know as Set Your Own Hours or Be Your Own Boss

Things You Don’t Get:

  1. Any guarantee of a minimum wage (I’ve been paid $5 to teach a 75 min yoga class)
  2. Any benefits including health insurance, disability pay or worker’s comp
  3. Paid sick leave
  4. FMLA or maternity/ paternity leave (not only do you not get paid, but your job is not guaranteed when you return)
  5. Unemployment benefits if you lose your gig
  6. Help with retirement (ex: an IRA or 401K account)
  7. Vacation Time (you can take vacation, but you won’t get paid)
  8. Payroll tax deductions (you are not on payroll)
  9. Social security
  10. Paid breaks
  11. Paid meetings
  12. Free snacks in the breakroom
  13. A breakroom

Oh, and did I mention that 30% of your income goes to self employment tax even if you make an income that would put you under the poverty line? No earned income credits here, because you are your own boss!

In short, you are your own safety net, and there is a long, long way to fall.




Kitchen Table Politics: The Cost Of Caring For Kids — Features – FiveThirtyEight

The 2016 presidential race has been filled with excitement and drama. But there’s another layer to American politics that gets less attention: How issues of home, family and wallet intersect with electoral politics and public policy.We’re tackling some of the issues that matter most to Americans’ daily lives, and how everyone from the presidential candidates…

via Kitchen Table Politics: The Cost Of Caring For Kids — Features –

I listened to this podcast today, riveted, as always, by the depressing statistics about family leave and childcare costs in this country. Thank goodness someone else is talking about it. Thank goodness I’m not alone.

Now can we do something about it, please?

Double Life

Our-actual-shoes(our actual, everyday shoes)

For the month of April I wanted to challenge myself (and you) to try to live on minimum wage, 2022 style, the year when California increases its state wide wage to $15/ hour. My hypothesis was that this is not a livable wage for a single mom with one child.

I did try to live this minimum wage lifestyle for the first half of April. I really did try. But then my real, hectic, freelance life caught up with me and I got caught in all the mental gymnastics of squaring my usual life with the imagined one with regular (if minimal) pay. What would I be doing on a Sunday if I were not rehearsing, playing an orchestra gig an hour away from home and then rushing back to teach yoga. Um, going to the beach? Cleaning the house? And what about Tuesdays when I usually take the morning off and go to the farmer’s market (cheaper than the weekend one)? My minimum wage doppelganger would have to drop her daughter at school at 8AM to get to work at 9 then home at 5 to throw together dinner before bedtime. That is, assuming she’s lucky enough to have a full-time job with regular, predictable hours and a manageable commute.

Because all my days were at least partially imagined in this way, my calculations feel fudged overall, from paying my half of my actual rent (an improbably low amount for the Bay Area) to how many miles to count on the car. I’m heading out of town this weekend for an orchestra gig. After paying for a babysitter and subtracting gas, a $118 gig with a 2 hour commute each way yields less hourly than a minimum wage job, but the lifestyle is different. The expenses are very different.

Basically, I made it through half a month on approximately $1250 but I have not paid off the daycare bill, and I didn’t factor in medical costs at all. Subtracting daycare from the second “paycheck” would leave me $285 for the rest of the month, or about $19/day and I don’t think I can do this for 2 more weeks. I still have to pay car insurance (approximately $50) and do laundry ($5 a load) and even in a super frugal week of food, I still spent over $80 on groceries. Plus 2 coffees out and a smoothie for my daughter if I’m being honest… and a beer once.

My experiment failed this time. But don’t worry, we have 6 more years until the law goes into effect. I’m sure we can collectively figure out how to make it work by then!

Here’s a few realizations:

1.It takes a lot of equipment to cook frugally and work full time. I’m lucky to have a bunch of wedding presents/ hand- me -downs including a slow cooker, blender, toaster, microwave, food processor and bread/ muffin tins that save time and make it possible to cook cheaper ingredients like dried beans or baked goods. I did also find myself shopping less in bulk and more for what I needed right then: pasta and sauce for dinner, oatmeal and milk for breakfast. It costs less money to buy one or two meals in the short term, but it’s not as frugal as stocking up. This lifestyle trains you to be penny wise and pound foolish.

2. Poor people are going to splurge too. Just because I’m working a minimum wage job doesn’t take away the craving for coffee in the morning or the desire for a relaxing evening and maybe a beer at night. Why would it? Plus, if I really were a working single mom there’s no way I could find time to de-stress with healthy activities like exercising or meditating or even reading to relax. Workplace yoga? I don’t think so. If you haven’t already read Linda Tirado, check out her essay This Is Why Poor People’s Bad Decisions Make Perfect Sense in the Huffington Post here.

3. The things I know how to be frugal with are not even included in my calculations. I can steal napkins from restaurants and stretch a roll of toilet paper or aluminum foil. I conserve water and electricity. I don’t buy new shoes. Or clothes. Everything other than housing and childcare turns into the category “other” when those items are such a huge percentage of income.

4. There is no way to save money or time or energy, especially money. If I come up short this month, there is no way to make it up next month.

I’ve been reading lots of Barbara Ehrenreich’s writing and want to end with a quotation from her Atlantic essay titled It Is Expensive To Be Poor . It’s a few years old now, but just as applicable today as in 2014. You can read the whole thing here.

“What I discovered is that in many ways, these [minimum wage] jobs are a trap: They pay so little that you cannot accumulate even a couple of hundred dollars to help you make the transition to a better-paying job. They often give you no control over your work schedule, making it impossible to arrange for child care or take a second job. And in many of these jobs, even young women soon begin to experience the physical deterioration—especially knee and back problems—that can bring a painful end to their work life.

I was also dismayed to find that in some ways, it is actually more expensive to be poor than not poor. If you can’t afford the first month’s rent and security deposit you need in order to rent an apartment, you may get stuck in an overpriced residential motel. If you don’t have a kitchen or even a refrigerator and microwave, you will find yourself falling back on convenience store food, which—in addition to its nutritional deficits—is also alarmingly overpriced. If you need a loan, as most poor people eventually do, you will end up paying an interest rate many times more than what a more affluent borrower would be charged. To be poor—especially with children to support and care for—is a perpetual high-wire act.”


new hashtag #minwagechallengefail


Childcare costs


(illustration from my daughter’s current favorite book, D.W.’s Guide to Preschool by Marc Brown)

All week, since I wrote my original post on minimum wage in California (see Minimum Wage, not an April Fool’s Joke), I’ve been agonizing over my calculations for full-time childcare. In real life I really do pay $965 a month for 3 days a week of preschool, but maybe this is completely out of range for a minimum-wage worker. Maybe I could find something more affordable if I really searched. My daughter’s preschool is a lovely place with dedicated (and probably underpaid) teachers, clean classrooms, an indoor gym, an outdoor play area and tons of fun art supplies (I’m flush in free necklaces she brings home as gifts). A few years ago when I toured every home day care in my town that had openings, the least expensive was $40/ day in an older woman’s  (“call me granny”) dumpy basement. By now, I’d guess the least expensive would run closer to $50/ day but I have not done extensive research to determine this.

Instead, I found a very useful chart at The Economic Policy Institute (www.epi.org). You can use their interactive chart to look up your home state and check out what childcare costs (I used The cost of childcare in California). Here are a few findings especially relevant for my purposes. Remember these are median for all of California, not the hecka expensive Bay Area:

  • The average cost of infant care in California is $11,817 per year or $985 per month.
  • Child care for a 4-year-old costs $8,230, or $686 each month
  • A minimum-wage worker in California [at the current rate of $10/ hr] would need to work full time for 30 weeks, or from January to July, to pay for child care for one infant. In other words, over half of her income would be going towards child care. Sound familiar?

Oh, you say, but surely there are government programs to support the truly needy. Isn’t there a program called Head Start? A quick glance at income eligibility on the government website shows that, no, a single parent making $30,000 per year would not qualify for California’s Head Start program, not by a long shot.

Unfortunately, it looks like my original estimate was in line with the reality of living in California as a single, low-wage worker.

What would you do if you were in this position? Join me on facebook or twitter for a #minwagechallenge




Minimum Wage, not an April Fool’s Joke


There’s some news today in California. Governor Jerry Brown just signed into law a bill that would increase the state minimum wage to $15 an hour. There’s some fine print too: it takes effect in 6 years. Today the minimum wage is $10 (though already a whopping $12.25 in San Francisco and Oakland). Next January it will increase to $10.50, then $11 by Jan, 2018 then a dollar more per year until 2022. There’s a good article on the background of this bill in the LA times from last Friday, in case you missed the news.

I am not a minimum wage worker. In most of my jobs I am categorized as an independent contractor, so the laws covering workers making minimum- or any kind of wage- don’t apply to me at all (no paid sick leave, workers comp etc). In fact, I worry that more companies will turn to the independent contractor model as a way to get around minimum wage. As an example: I have taught a 75 minute yoga class for $5 when only one student showed up. This was completely legal under my contract with the studio. Most of the time my hourly wage is much higher (see my past Freelancing and falling acorns post). However, many months I barely get by and I have a strong emotional reaction to this news, in the spirit of working class solidarity.

It’s hecka hard to live on $15/ hour in urban California. Even now, in 2016, 6 years away from the end goal, with rents rising every year. I want to do a thought experiment this month about a single mother with one child under the age of 5 living on $15/ hr. If she worked a full-time, 40 hrs/ week job, she would make approximately $30,000 a year or $2,500 a month before taxes. Could she do this? Could you? Could I? Well, here goes. I’m going to try for the whole month of April. My hypothesis? I’m not going to be able to do it because $15/ hr is not a living wage for a single mom. And these people exist. This is a not hypothetical or far-fetched scenario. The opponents of this bill and every minimum wage proposal always seem to bring up the argument that minimum wage workers are teenagers still living with mom and dad. Laura D’Andrea Tyson refutes this argument convincingly in the New York Time Economix blog:

“Less than half of all workers are women, but they account for 75 percent of workers in the 10 lowest-paid occupations and about 60 percent of minimum wage workers. And most women earning the minimum wage are not teenagers, or wives who can rely on a spouse’s income.

About three-quarters of female minimum wage workers are above the age of 20, and about three-quarters of these women are on their own. Many, of course, are working and taking care of children.”


So, I’m a woman. I have a child. For the month I’m going to do my best to pretend my husband does not exist and it’s just me and my daughter.

The budget: I’ll get paid twice a month (instead of the dribs and drabs from a mix of gigs and jobs), $1250 on the 1st and $1250 on the 15th. That’s the total money in. But I’ll still pretend that I pay $800/ month for rent (my current half) and $980 for daycare, which is artificially low since we only pay for 3 days a week  Maybe there is a full-time daycare for this amount somewhere??? Then there’s food, gas, car insurance, medical costs and bills, which all have to be covered by the remaining $670 or approximately $22/ day. I’m also going to conveniently ignore student loans and credit card debt in this calculation, though I know many minimum wage earners have these crosses to bear.

I’ll keep a running tab, week by week. I’m really going to make a go at making it work, but I really don’t think I can do it.

In case you were thinking of bringing up the welfare question, realize that there is no state aid for a family of 2 making $30,000 per year. Programs like WIC, Food Stamps and Medi-Cal all calculate need as a percentage of the poverty line, which is currently $15,730. A full-time $15/ hour job gets you almost to 200% of the poverty line, which is higher than the cutoff for all of these programs.

And the federal minimum wage in 2016? $7.25. Less than a cup of coffee at many San Francisco hipster hangouts. Only $1.25 higher than in 2001 when Barbara Ehrenreich wrote her amazing book Nickel and Dimed. Read it. Discuss. See you next week.


Your Call

In these past couple of months that I have not been blogging, I’ve been reading and thinking a lot about the issues and drawbacks of an economy that depends on a freelance workforce. I just finished the book Raw Deal by Steven Hill, which I highly recommend.  It focuses on the so-called Sharing Economy of companies like Uber, AirBnB and TaskRabbit and how disempowered the independent contractor workers are. No health benefits, no vacations or sick leave, no disability, none of the safety net we in America tend to associate with  “having a job.” Of course, I knew this already as a seasoned freelancer, but the injustice has not ceased to sting.

With his words ringing in my ears, I wrote an email response to a local radio show- Your Call- on San Francisco’s KALW station. The show was mainly about low wage workers surviving in the out-of-control housing market in San Francisco (and if you don’t live in the Bay Area, just search craigslist for examples like this posting for a $15,000 month 2 bedroom).

Here is the email I wrote to Your Call:

Great show today! I’m part of the working poor as a freelance musician and music teacher. Though I usually come out ahead in comparison to a minimum wage worker, I wanted to point out that freelance workers have no safety through work with programs like workers comp, disability, unemployment (not to mention health benefits, sick time or vacation pay). Although I fully support the efforts to increase the minimum wage in San Francisco and beyond, I wonder if more companies are simply going to switch their workforce to 1099 independent contractors. Companies like Uber, Instacart, Postmates, TaskRabbit etc already do this and workers have no guarantee of making minimum wage, or any set wage. What protections do “independent contractors” have in San Francisco if any and how can we widen the conversation to include them?

Listen to the show San Francisco- A Tale of Two Cities to hear the panelists discuss my question (it’s the last one on the show!) although the whole show is really great. And please leave your own comments and responses below.



A few definitions (adding to the confusion)


(stock photo url: freelancer-using-notebook-woman-working-on-laptop-computer-typing-the-keyboard-at-home)

I’ve been freelancing since before it was cool to freelance (wait, was it cool in 2001?). Now the term is all the rage on glitzy new media sites and it seems like every other job out there is part of this new “gig” economy. When you think of a typical freelancer, do you picture a hip 20-something doing something cool and undecipherable, like writing code or designing graphics on a laptop in a cafe? Our stock photo friend pictured above? Or a creative professional such as a photographer traveling the world? I think that these jobs do exist, but they don’t resemble the piecemeal work of most freelancers I know. The more I explore it, the more hazy the term becomes.

Here’s an incomplete list of synonyms for freelancer or freelance work: Self-employed. The gig economy. Independent Contractor. 1099 employee. Small business owner. Independent Worker. Entrepreneur. These days it seems everyone and their little brother wants to be an entrepreneur or _______-preneur. I’ve heard the terms solo-preneur and mom-preneur more than I’d like lately and even just googled violinpreneur, and yes, it exists. But, if you’re like me, you’re still trying to figure out the rules and possibilities around plain old freelance work.


On wikipedia (https://en.wikipedia.org/wiki/Freelancer), I learned that the term was invented by Sir Walter Scott and was used to describe a mercenary soldier, someone who was not in the service of one lord or master . Free as in liberated, lance as in that long pointy weapon you use to stab your enemy. These days freelance work can encompass many fields but is mainly defined by the lack of a typical employer-employee relationship. We work for no lord! Or at least we have multiple lords…

In a freelancers life, jobs are often categorized by tax status. When you are employed, even part time as an employee, you receive a W2 with taxes like social security, disability etc taken out by the employer. The independent contractor tax form is called the 1099, so sometimes independent workers are called 1099 workers. In this case, the person paying (usually called the client) is not responsible for any deductions or taxes.

In my life I work a mix of W2 and 1099 jobs or gig. Sometimes the actual work is identical in nature. For example, playing for the Santa Cruz Symphony is a W2 job,  playing for the Santa Cruz ballet theater is a 1099 job. The group of musicians is nearly the same and we perform in the same venue. As a violin teacher, I have been truly self-employed which means I have recruited my own students and taught in my own space; I have been hired by studios as an independent contractor and I also have been hired by studios or schools as a part-time employee (W2 not 1099). The work was nearly identical in each case, though only in the first could I set my pay rate.

The IRS considers independent contractors to be self-employed, so it is all the same to the government if you are a self-employed violin teacher, an Uber driver, dentist, or a techie raising millions of dollars of venture capital for some new app. If you work for yourself and don’t have an employer taking out taxes, it is legally the same as owning your own business. In IRS speak, “The general rule is that an individual is an independent contractor if the payer has the right to control or direct only the result of the work and not what will be done and how it will be done.” (www.irs.gov) The most straightforward example of this client/worker relationship I can think of is that of a contractor you would hire to work on your house, say to fix a roof. The client calls for a quote and the contractor sets the rate and time estimate. The contractor provides a contract that the client (not called an employer) agrees to. Thus the term independent contractor.

In the real world, many independent contractors are not truly self-employed. There are many grey areas with projects that don’t have a set completion date. For example, I have taught music at a school, with prescribed hours, pay and curriculum and still been considered an independent contractor, which coincidentally saves the employer (not my client…. see how this is confusing?) a lot of money and paperwork. The school or program or company is not obligated to pay for payroll taxes, workers comp, disability insurance when hiring an independent contractor. Many new companies in this “gig ecomony” like Uber, InstaCart, PostMates, DoorDash etc. are using independent contractors as workers. More and more companies are following suit even for administrative office jobs that formerly would have been straight-ahead employer/employee jobs. The hip term for this disturbing trend is “uberization.”

So, to sum up: Independent contractors (1099 workers) and freelancers are not exactly synonymous. A freelancer is someone who works for multiple clients and/ or employers, sometimes as an employee, sometimes as an independent contractor, sometimes hired long-term, sometimes under the company’s guidelines, sometimes for a third-party contractor. Sometimes the independent contractor is truly independent and allowed to set his or her own pay, terms and hours, sometimes he or she simply signs a contract agreeing to terms that have already been set. If you work for Uber or TaskRabbit or similar companies, you are considered an independent contractor but you are not necessarily a freelancer. If you work for multiple employers, you may be an independent contractor or just a part-time worker, it depends on your tax status. If you’re a musician, you are probably a freelancer, unless you have a salaried job at a major orchestra or university. If you work a traditional job in which you are paid hourly or salaried and get a W2 tax form, you are not an independent contractor but you may freelance on the side as a self-employed entrepreneur, say by designing websites or selling stuff on Etsy. If you stab people on horses for money, you are most definitely a freelancer.

Clear as mud? Welcome to my world.

Next time I’ll explore the actual benefits, and lack thereof, in independent contractor work. In the meantime, please send me stories and examples of freelance or independent contractor work you have done… I especially love horror stories!

Now get back to (freelancer-using-notebook-woman-working-on-laptop-computer- typing-the-keyboard-at-home) work!