It Is Time for Portable Benefits for Gig Workers, Including Artists

Grantmakers in the Arts (GIA) believes that artists are workers, who deserve to be treated as such. GIA also believes that public policies and practices must be strengthened so that our nation treats workers, including independent contractors and gig workers, with the respect and dignity they deserve.

Between 10-30% of workers are independent contractors or gig workers — in other words, self-employed and contracted to perform work for or provide services to another entity as a nonemployee. Many artists fall into this category, including the teaching artists who steward our children’s education and imagination. These workers don’t qualify for employer-based benefits like health care and paid leave, and growth in this category has contributed to a long-term decline in the percentage of unemployed workers eligible for unemployment insurance.

Thanks to the CARES Act, the Pandemic Unemployment Assistance program gave states the option to extend unemployment compensation to independent contractors. It was a public acknowledgement that our unemployment system doesn’t work for everyone; now, GIA calls upon our federal legislators to expand unemployment assistance to gig workers permanently. Of course, unemployment insurance is only one of the benefits that gig workers require. Employment benefits — health insurance, retirement accounts, workers’ compensation, paid time off — create more financially secure households, which contribute more to local economic growth and rely less on public safety net programs.

How would portable benefits for gig workers be financed and provided? There are a number of small-scale examples that could function as scalable approaches. None of these are mutually exclusive, either — in fact, the solution will likely require a blended approach.

First, the government could contribute to benefits by increasing an existing tax or introducing a new one on certain products or services, which is the current model for a range of public benefits and services. The government could also engage the business community, requiring them to contribute directly — San Francisco's Health Care Security Ordinance requires covered employers spend a minimum amount of money on health care benefits for their covered employees, even if they are temporary, part-time, commissioned, or contracted. Or take the Massachusetts paid family and medical leave policy, which makes employer contributions mandatory for any business with a workforce comprised of more than 50% independent contractors.

Some employers push back against these public mandates, concerned that it’s the beginning of a slippery slope toward classifying independent contractors as employees. In response, Washington state’s proposed legislation includes a “hold harmless” provision that contributions to portable benefits may not impact a worker’s status as an independent contractor. We must also not allow some employers’ support for portable benefits to distract from the need for appropriate worker classifications or the need for benefits — portable or otherwise — to be robust.

Customers may also contribute to gig workers’ portable benefits. New York City has a mandatory 2.5% customer surcharge on each black car ride that pays for workers compensation. Alia, a portable benefits platform created by the National Domestic Workers’ Alliance’s Innovation Lab, offers paid time off and several types of insurance through a voluntary customer contribution. The workers themselves can contribute toward a benefits fund that allows them coverage at a lower rate than they’d pay as individuals, which is the model that the Freelancers Union employs. This is not a solution in and of itself, though, as few workers are able to cover this expense entirely.

Ultimately, voluntary support from employers or customers will remain marginal and have little impact — and if worker contributions could solve the problem of worker precarity, the problem wouldn’t exist. The above examples are small-scale and provide only part of the resources needed for only a few benefits at a time. Public policy — at the federal, state, and local level — is required to ensure that one of the fastest growing group of workers has financial security.

There have been legislative proposals advanced from across the political spectrum to address these challenges. Bipartisan federal legislation has been proposed, as have proposals in Georgia, New Jersey, and Washington state. GIA is not citing the perfection of any of these proposals, nor the legislators that proposed them; GIA is citing the importance of the issue each seeks to address and the workers they seek to support. GIA calls upon our colleagues to encourage their representatives to introduce or back legislation to support portable benefits for gig workers. These rights and benefits are necessary for our creative workers, part-time educators, and so many others to experience the stability, security, and health that will help them contribute to our entire nation’s ability to thrive.

I extend my gratitude to Center for Cultural Innovation, Aspen Institute, Center for American Progress, and The Century Foundation, among others, for the research that informs this piece.