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October 2012

Help for Freelancers

Odds are you know a least a handful of them. They tote laptops, look for the perfect coffee shop ambiance, and find space for a “home office”—even in New York! They troll job postings and have their fingers in a lot of pots. When asked what kind of work they do, they reply, “this and that.” The government calls them “contingent workers.” You know them as “freelancers.” They are part-timers, independent contractors, temps, and consultants, and they make up almost a third of the American workforce.

This isn’t the workforce as we used to know it, the kind in which people built a lifelong career at one company, earned steady promotions, and eventually retired with a pension and insurance. Now, an estimated 42 million workers are freelancers who work on a project basis for various clients, measuring their employment in “gigs.” With more and more people becoming independent workers, more and more people have no voice and no benefits.

Sara Horowitz foresaw this growing trend back in the nineties. Horowitz, the daughter of a labor lawyer, the granddaughter of the vice president of the Ladies’ Garment Workers’ Union, and herself a labor lawyer and union organizer, saw power in numbers. She envisioned a new kind of workforce advocate, one that would unite independent workers to help them exercise influence in politics and the marketplace.

In 1995 Horowitz founded Working Today—now called The Freelancers Union—a national nonprofit membership organization to create a portable health insurance product for New York City’s growing number of independent workers.

In the late nineties, the Freelancers Union was in research and discovery mode. It examined the legal, structural, and regulatory barriers independent workers face in getting affordable health care and looked for a practical solution.

The New York Community Trust was one of the organization’s early supporters, recognizing the plight of uninsured freelancers as a significant, growing need. In 1999 and 2001, The Trust provided the group with two grants totaling $90,000, first to study the feasibility of creating an affordable health insurance option for freelancers in New York’s media and technology industries, and then to promote the plan. Studies show that even in 2000, independent health insurance plans had premiums that ran as high as $10,000 a year and that only 5 percent of freelance workers could afford them. Working with consultants and researchers who had expertise in employee benefits and health insurance, the Freelancers Union started to figure out how to help.

And help they did, founding the Freelancers Insurance Company (FIC), which today covers more than 23,000 New Yorkers at rates up to 40 percent less than other insurers. The Freelancers Union has grown, too, with more than 165,000 members in all 50 states. It has become a trusted authority on protecting this increasingly important demographic. The challenges the organization foresaw and sought to remedy are gradually gaining more attention.

This past March, the Affordable Care Act was passed and made way for private insurance options that would offer affordable health care options for American workers. It’s no surprise that government chose to award the Freelancers Union with $340 million in federal loans to help create these so-called “CO-OPs” (consumer operated and oriented plans) in New York, New Jersey, and Oregon. This is just the kind of gig they’re made for.

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