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Contractor recognition by policymakers across Europe at all-time high, says expert

Contractor recognition is at an all-time high across Europe, as policymakers become increasingly aware of core contracting issues and the importance of independent professionals (Ipros) that are a key component of Europe’s highly skilled flexible workforce.

“The movement towards self-employment is a global phenomenon and the problems we face in the UK are not unique,” explains Patricia Leighton, Professor of European Social Law at the IPAG Business School.

“Work within Europe, particularly by the European Forum of Independent Professionals (EFIP) and its member organisations, is bearing fruit as we are beginning to influence programmes of public funding in the European Union (EU) to research and address the practical challenges facing Ipros.”

However, Leighton warns that there are still challenges to overcome, particularly those of misperceptions by policymakers that Ipros are ‘fraudulently self-employed’ and in some way ‘crooked’.

EFIP has grown to encompass most EU member states

According to Leighton, a driving force behind greater contractor recognition is EFIP, its secretary general Marco Torregrossa and the member organisations: “EFIP has an excellent secretary general who has brought nearly every EU member state into its membership.”

Recent additions include some of the Nordic states that have been historically less willing to participate, including Sweden, alongside Central and Eastern European countries such as Romania, Bulgaria and Poland, and new member states like Croatia.

“The research arm of EFIP is driving important new research into the obstacles and barriers to securing freelance contracts and the challenges Ipros experience when trying to work across national borders.”

European institutions are recognising Ipros

A further step forward has been strengthening links with the European Commission (EC), as Leighton explains: “The EC’s Directorate General (DG) Growth has a new unit that is concerned with the collaborative economy, of which freelancing is an important part.

“I am working closely with the commissioner to look at new ways of collaboration and networking. A series of meetings are planned for the coming months to discuss key issues such as the classification of self-employment and employment.

“The events are hosted by organisations such as the European Economic and Social Committee, with support from MEPs such as Anthea McIntyre, which demonstrates that Ipros have gained recognition at the highest levels of the EU’s policymaking.”

Social protections for Ipros are gaining importance

Leighton highlights that another major area of focus at a European level, and where the UK’s position is underdeveloped, is social protection: “Across the wider European Ipro population, the self-employed are unable to access benefits. This means many are without pensions, and can’t afford to become ill or have children.

“When you look at the level of social security contributions that Ipros make, they are actually not that far from what employees make, yet the benefits that the self-employed receive are zero. There is an agenda that is gaining traction and momentum to establish a baseline of rights across the EU for all workers regardless of their status.

“However, there is a balance to be struck. No freelancer or contractor wants or would expect compensation for the loss of a contract, and the risk of not having work should clearly rest with the individual.

“But, there are social benefits that should not depend on the basis on which you are working. What matters is that individuals face challenges at different stages of their lives and we need to think about how best to respond to these. Ipros themselves need to take a less ‘macho’ view of their position.”

Leighton believes that there are opportunities for organisations to provide that safety net; it does not just have to be the state. Membership organisations and even employment businesses such as umbrella companies could find a role in this way.

Self-employment demographics are shifting

Leighton’s ongoing research is flagging several other important trends, one of which is that more young people are becoming Ipros: “We have too many graduates and not enough graduate jobs. People are thinking the unthinkable and saying ‘nobody else is going to look after me so I will have to look after myself’.

“Young people are completing internships and then setting up freelance businesses. This is a huge change from the traditional wrap around education system.”

But Leighton notes that although Ipros may have the required professional and technical skills, not everyone has the entrepreneurial skills to make it as an Ipro. She sees this as another opportunity for organisations and businesses to provide support.

“Organisations such as the British Computer Society (BCS), or the Association of Independent Professionals and the Self-Employed (IPSE) need to be thinking about protecting these groups of Ipros looking for support – in the UK we are beginning to think this way.”

Although the creative industries, the professions and areas such as IT and engineering are still strong Ipro sectors, there has been a surge in the number of healthcare Ipros and para-professionals, such as paralegals.

Political parties are slowly waking up to the self-employed constituency

In the UK at least, there is a slow realisation that the 5m self-employed represent a growing and voting constituency that contains many of the brightest and best. The Government has a tendency to give with one hand and take away with the other – there is no joined-up thinking, but this can be changed through education.

Taking a step back, Leighton also believes that further attention is required on issues such as open markets and removing the obstacles to freedom of movement across the EU, perhaps with a self-employed skills passport. Other subjects, such as the position of company directors, competition law and of course taxation also need review.

Leighton concludes: “Now there is a sense that a population is emerging who are really interesting, and Ipros in the EU are in a better place than a year ago. This is down to the efforts and energies of membership organisations working very hard at many levels to provide evidence and education to policymakers and governments.”

Published: 23 November 2015

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