Chan Chun Sing: Making sure freelancers aren’t fleeced

Nov 18, 2016 06.00PM |
 

by Suhaile Md

We interviewed Mr Chan Chun Sing, Minister in the Prime Minister’s Office and head of the labour movement, on the profound changes affecting the job market and the NTUC’s role in the new economy. This is the second of three parts. Read the first part here.

JUNE is usually the month to look forward to for freelance netball coach, Mr Justin Teh. The month-long school holiday meant his charges could train without the worries of a classroom weighing them down. A golden opportunity for growth.

But there was that time when his plans for player development gave way to disappointment. The school cut his time from four weeks to two. He was lucky. Some coaches have their time trimmed to zero and their income for the month disappears.

Said Mr Teh: “This throws the freelancer off. Because you committed to certain expenditure, certain payments that you have and suddenly you’re robbed of an income that you thought you were going to have in the future.”

Factor in the year-end holidays plus exam periods and a 12-month contract for $12,000 could well be worth only $9,000. Trouble is, the terms of their contracts allow this. Schools are the primary sources of income for them, so freelance coaches have little say when thrashing out contractual terms.

Unlike the usual employer-employee relationship where a worker has one contract with one company, freelancers have to consider multiple contracts with multiple companies. For that one person, “where got time, where got energy, where got capacity,” asked Mr Chan Chun Sing. Basically, there’s an “asymmetry in the capability and resources,” he added.

Freelancers have to consider multiple contracts with multiple companies. For that one person, “where got time, where got energy, where got capacity,” asked Mr Chan Chun Sing.

Which is why the National Trades Union Congress (NTUC) set up the Freelancers and Self-Employed Unit about two years back. It was around this time that Mr Teh decided to approach the NTUC to help set up the Sports Coaches Association (SCA). The SCA was officially registered in March 2015.

There were only 10 members at the start. Now there are 200. The vast majority (70 per cent) earn at least 80 per cent of their income through freelancing. Membership fees are relatively low – $117 a year – for the benefits: Death and permanent disability insurance coverage and discounts at medical clinics among other things. Besides these benefits, SCA also arranges for members to attend workshops like income tax filing, and sports-related legal education.

It is “tough” to grow the membership base, said Mr Teh. Freelance coaches “don’t even know we exist”. Those who do know, are “skeptical” about a young association. Some don’t even see the need for the SCA. Well, not until they run into problems themselves at least.

Freelancing covers an endless spectrum of services, from bookkeeping to writing, photography, and driving to name a few. The freedom to pick up jobs as and when, and to do it within a person’s free time is appealing to many. Some pick up extra income while others do this full-time. Full-time freelancers keen to accumulate as many contracts as possible might pass over the benefits applicable to those in a normal employment structure, such as medical benefits.

But Mr Chan wondered if they could answer questions like what would be the competitive rate for service? Or what terms and conditions should be attached to a contract.

For example, is insurance covered? Who’s liable to what extent on matters of safety? Different clients can have different contracts with different terms. “One pay me if I sprain my [right] ankle, the other one pay me only if I sprain my left ankle… very difficult,” he said.

Furthermore they “must know what are some of the basic things” to plan for in the long term, like retirement, medical and insurance.

A relatively new phenomenon has entered the picture: the rise of the gig or share economy which has resulted in an overturning of the employer-employee relationship. Should someone doing courier/delivery service for an online platform or driving an Uber taxi be defined under a contract of service or contract for service?

The United Kingdom “recently passed rules that uber must treat [drivers] as employees” and Canada ruled that while Uber drivers were not employees, they “must pay some equivalent social security” to its drivers. This is so that Uber as a company does not “externalise the social cost,” said Mr Chan.

This concern of externality echoed Deputy Prime Minister Tharman Shanmugaratnam’s view at a forum last month. He said that while it provided jobs, such a model “serves the interest of the company because they’re really pushing risk onto the contract worker” and it was not a good social model. Read more about the pros and cons of the gig economy here. 

Some Uber drivers, Mr Chan found out, did not realise that Uber pegs its prices to supply and demand. So a drivers income would vary week to week. But they “lock themselves into a fixed price [car] rental” at the start because they did not realise it before hand.

Like freelancers, those who are part of the share economy do not come under the protection of the Employment Act – they are not employees. So they have no health or retirement benefits.

“There’s nothing wrong with the gig economy so long as you’re disciplined enough to take care of yourself, your retirement,” he said. But the fact remains that plying their trade outside the cocoon of an organisation have little protection and not everyone is disciplined. “So you assume that most people can ka ki kor ka ki (be self-sufficient) but there will be some that society has to chip in and support.”

 “So you assume that most people can ka ki kor ka ki (be self-sufficient) but there will be some that society has to chip in and support.”

In the United States and Europe, between 20 and 30 per cent of workers do some form of freelance work according to a McKinsey report this year. In Singapore, 14 per cent of all resident workers are self-employed, said Manpower Minister Mr Lim Swee Say in Parliament on Feb 29.

Over half of the self-employed operate their own business or trade without any paid staff. While the world grapples with such changes, Mr Chan thinks that two steps must first be taken.

First is to get freelancers to come together and “share the information… where are the opportunities, what are the things to look out for,” what to do or not to do, said Mr Chan. The kinds of things they can take of care by themselves first. Educate each other on their legal rights, financial considerations and so on.

The second step can then come into play, where they can attend NTUC organised conferences, and seminars to “keep abreast” of issues as well as upgrade themselves. The NTUC’s Freelance and Self-Employed unit is already looking into this.

For Mr Teh, it is clear that the collective voice is louder than the lone shout. Mr Teh did not go anywhere with MOE when he aired his concerns to officials as a freelancer. But with the organisational clout of 200 coaches, the SCA is now in talks with MOE to address the issues and technicalities on freelance coach contracts.

Naturally, having a larger pool of members would be better. Added Mr Teh: “The hope is that coaches will come together, because there has been and there will be competition among coaches… but by coming together we can actually make the community better and make sports more vibrant.”

 

Read the other pieces from our interview with Chan Chun Sing:

1. Chan Chun Sing: Your job is NOT safe

3. Chan Chun Sing: It’s working people; not working class

 

 

Featured image by Natassya Diana.

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