We actually work for a living.
It occurred to me the other day that there’s a huge difference between employees and freelancers. I don’t mean to say that I suddenly saw the light — I didn’t. I’ve known the differences for a long time. But the other day, I actually stopped for a moment to think about them. I thought I’d share some of my thoughts here, laid out in a simple table to make comparison easier.
|Employees can stop looking for work once they get a job. The only times they need to look for work again is if they want to change jobs, they get fired, or they need a second job.||Freelancers are always looking for work, even when they’re working. The ability to earn a living depends on having the next job lined up.|
|Employees seldom have to worry about losing their jobs to someone who claims he can do it cheaper.||Freelancers are constantly competing for work with others who claim they can do the same job for less money.|
|Employees usual do one job at a time, although that job might entail several concurrent projects for the same employer.||Freelancers often work on several jobs for several clients concurrently.|
|Employees are usually given all of the tools and equipment they need to perform their jobs. These tools are usually purchased, maintained, and updated by their employers.||Freelancers usually have to buy, maintain, and update all of the tools and equipment they need to perform their jobs.|
|Employees often spend part of their workday socializing with coworkers around the water cooler, coffee room, offices/cubicles, cafeteria, etc.||Freelancers often work alone. Most time spent socializing is not time they’re being paid for.|
|Employees often get benefits that include paid vacations, paid holidays, paid sick days, health care, pension contributions, profit sharing, and bonuses. There are holiday parties, company picnics, and sometimes even birthday cakes.||Freelancers don’t get benefits. If they can’t work because of illness, they don’t make money. In the U.S. (and some other countries), they have to pay for their own health care, often at extremely high rates. There are no holiday parties, company picnics, or birthday cakes.|
|Employees have a predetermined workday, such as 9 to 5. They also get scheduled days off, like weekends and holidays. If they don’t feel like coming into work, they can take a paid sick or personal day off. The flip side of this is that an employee has a limited amount of time off.||Freelancers work as long as they need to to get the job done. If that means 12 hour days and lost weekends, so be it. If they don’t feel like working in the middle of a job, that’s too darn bad; the job needs to get done on time. The flip side of this is that a freelancer can have as much time off as he wants, as long as he works enough to earn enough money to survive.|
|Employees are usually not bothered by their bosses outside their normally scheduled workday.||Freelancers can be bothered by clients any time the client wants to make contact (although most clients keep contact within their working hours).|
|Employees can have annoying or even stupid bosses.||Freelancers can have annoying or even stupid clients.|
|As long as an employee performs his job to some level of satisfaction, he’ll likely remain employed.||A freelancer needs to perform high quality work for every job to set himself apart from the competition, with the hope that the client will either give him future work or recommend him to others.|
|Employees get paychecks. The government ensures that they get paid.||Freelancers issue invoices and spend time following up on accounts receivable. They sometimes have to remind, nag, and then possibly sue clients to get paid.|
|Employees have payroll taxes taken from their pay and remitted to the government. In the U.S., their employers pay 50% of their social security tax liability.||Freelancers don’t usually have taxes taken from their pay and remitted to the government. They are required to submit taxes quarterly, along with the related paperwork. If they don’t submit on time, they could be penalized. In the U.S., they are personally responsible for 100% of their social security tax liability.|
What did I leave out? Employees and freelancers, use the Comments link or form to fill us in.