Self-employment: the good, the bad and the ugly

23 November is National Freelancers Day in the UK, when we doff our caps to those brave souls who plough their own furrow in the world of work. Did you know, a colossal 15% of UK workers are already self-employed? If you’re thinking about joining them, here are a few things to think about.

The good

You may have heard attractive things about freelancing – be your own boss, choose when and where you work, take time off when you want, charge top-whack for your services… this can all be yours! When freelancing goes well, it goes really well. If you have skills that are in demand and the motivation to make it work, there’s a good chance you’ll never look back.  

The bad

So what’s the catch? Well, not everyone is cut out to manage their own time, chase down jobs, deal with pesky admin and tax returns, put up with the peaks and troughs in work (and cashflow), cope with isolation... the trade-off of not having to answer to anyone is that the buck for everything stops with you. And if you’re not prepared to take the rough with the smooth, freelancing could quickly become a stressful and disheartening experience.

As a freelancer, you also forego the basic employment rights that all regular employees enjoy, including sick pay, paid leave, minimum pay, maternity leave, working time rights, health and safety protection and the right to join a union. You will also have to arrange your own pension, and will not have the benefit of a workplace pension scheme to supplement your contribution.

Turning down the perks of being on the payroll to go freelance is not a decision to be taken lightly, but if you think you have the right temperament and enthusiasm, don’t let that put you off.  Read our Self-employment section for more on the pros and cons of freelance and advice about how to get started.

The ugly

Self-employment in the UK has rocketed in recent years. According to TUC analysis, it accounted for 44% of the net rise in employment between 2010 and 2014. You may then be wondering why more and more people are choosing self-employment when going it alone carries enough risk to give anyone pause for thought. Sadly, the truth is that self-employment is not really a choice at all for millions of UK workers. A trend towards increasingly casualised employment with weak rights and low pay is propping up the UK's fragile economic recovery. This means while there are more jobs, fewer and fewer of them are secure or pay a decent wage. The vast majority of self-employed people are more likely to be taxi drivers, carpenters and builders who can’t find the payroll jobs they really want, rather than well-heeled consultants sipping leisurely lattes in posh coffee shops. Average earnings from self-employment in autumn 2014 was £207 a week – less than half that of employees.

Some unscrupulous employers also deliberately miscategorise their own workers as ‘self-employed’ in order to avoid granting them the basic employment rights they are due as workers or employees If you believe you are falsely self-employed, you may be able to challenge your employer through an employment tribunal (although government legislation has made this extremely difficult). To work out your correct employment status, see definitions of workers, employees and the self-employed

Getting help

Whilst you might not have a workplace union branch any more, many unions are specially set up to help freelance workers. If you're in a profession dominated by self-employment, there may be a union that caters specifically to what you need. That could be as a musician trying to get a late invoice paid by a promoter with some help from the Musicians' Union, or a photo-journalist seeking to get a media outlet to respect the copyright on your work with help from the NUJ.

And if you're one of the growing number of involuntary self employed workers, it's worth talking to the sectoral union anyway, such as UCATT for construction workers. They'll be aware of the issues around insecurity in that industry and how workers can deal with it by coming together.