Unlocking eSignature Legitimacy for Freelance Contracts in the European Union

How to eSign a document: e-signature legitimacy for Freelance Contract in European Union

[Music] [Applause] european freelancers and where to find them let me start with why why i believe that this is a topic relevant to this conference i think there are basically two reasons first of all many of you are probably freelancers looking for ways to improve your understanding of what does it mean how to improve your business strategies and some of you probably work with freelancers in your teams in your companies in your startups are hiring freelancers so that's one reason and the second reason is that i believe that there is a long-term underlying problem with the european freelance economy uh and that is that the european freelance economy is highly fragmented much more than in the us uh divided on a national level and therefore fewer independent professionals than people think usually so my goal or my my objective for this talk is actually to to try to correct some common misconceptions about freelancing and um based on the improved understanding that we may reach i will try to give you some entirely practical uh guidelines or insights that you may use in return in your freelance practice or with working with freelancers let me just introduce what i do very briefly i've been a freelancer since 1998 i became a web developer in spain so actually i i feel very proud and honored uh to be a part of the web industry in those pioneering times before the dot-com bubble uh and i'm excited to be here it's it's honor really and well gradually my focus shifted towards supporting other freelancers so i became a business consultant then in 2005 i founded the czech freelance community currently one of the largest and most active in europe we support over 200 000 czech freelancers in their business and in 2012 we founded the first freelance think tank in europe a meeting in prague and other cities as well as online these days and in 2017 i wrote a book about freelancing it was later translated to english it's called the freelance way and that was really a pivotal moment for me because making the transition making the translation actually like made me way more concerned about the issues of the european freelance economy something i i was not really too focused on before and it led me to found my latest venture in 2020 the freelancing eu uh upon european freelance community that we are now trying to develop to support freelancers all across the continent so let me begin with this uh with this misconception as you can see uh i've been dealing with freelancers and freelance work all my professional career i'm a freelancer i i work with finances as a business consultant i'm a community organizer writer a researcher so this talk would be both based on well hard facts or hard data about freelance economy as well as hard realities of doing freelance work so i hope you will enjoy it and you will have some takeaways from it so let me let me begin with the first misconception a really easy one uh that the self-employed is basically the same as a freelancer now this is very often mentioned in the generic media and it doesn't work on at least two levels first of all these two terms are completely different in their nature a self-employed a legal status in most countries while freelancing is basically certain approach to doing business it's not universally defined it's totally informal but it already tells us something about about the nature of the business itself because we we may understand it that it's probably an individual like working freely on on a market and you know with some publicly decr declared expertise or profession and the second level where it doesn't work is that these are basically two independent groups of each other and uh they overlap quite a lot but they are different so you are for example self-employed who cannot be uh tagged as freelancers or would not identify as one so this would be for example uh self-employed who employ other people i have a client for example and she employs at least 10 other other people as employees so she also presents her business as a small business under a brand of despite being self-employed so when you meet her and her business on a free market you would take it as a company probably and they are also self-employed who are so-called misclassified employees this is a highly debated hot topic among policy makers these days because these are people who have the official formal status of the self-employed but who are actually working for a single client or a single company and that company treats these self-employed basically as employees so there is this ongoing policy debate whether for example uber drivers should be protectors and employees or not whether they should be classified as such i won't go into that topic today but it's quite important and it's and it's and it's moving it's growing uh on the other hand most freelancers have the self-employed status but some don't so for example you have freelancers who run their business as a limited company or who are invoicing through someone else so for example they may be invoicing through an invoicing company or the parent sometimes a partner now this is definitely not recommended but it happens sometimes and there are also free renters who don't have the status of the self-employed because they may not be required to to have one under their local conditions local laws so for example they only file some one-off income without without the status so as you see there is an issue with defining freelancers and although it may look like a totally theoretical one it actually influences very strongly the way we talk about the freelance economy as i will explain in my second misconception but before i just want to show you this quick reality check i have one in each misconception there is a great report by ipsy in the united kingdom that states that that there were 14 percent of the self-employed in the uk workforce and freelancers they openly admit that there is no official standard or universally accepted definition of freelancers in the uk so they define them as basically as qualified workers without employees working in a range of managerial professional and technical occupations and they found out doing this doing this estimate that basically half of the self-employed are freelancers so just to show you how how it relates to a real world data the first misconception the second is related strongly to this to this problem with the definition because uh some of you may be reading articles about the so-called future work it is a hotly debated topic because as we all see the world of work is changing and i often read this claim that freelancers make up one-third or open one-third of the labor market it's really very often mentioned and i would like to dispute this and show you how it happens that that this statement is often quoted and for this reason i would like to show you three estimates based on different definitions of the freelance work and the first and the most quoted one is uh by upwork they are doing annual reports and they uh they basically claim that 36 percent of 59 million of americans are doing freelance work which is which is a huge number so when you actually go into the report and look how they define a freelancer uh i will close them to be precise they define freelancers as individuals who have engaged in supplemental temporary project or contract based work within the past 12 months so at the first glance it look looks okay until you realize that having only a tiniest income apart from i would say regular employment would make you a freelancer in their view so for example if you start a website and run some google x there and you receive your first 100 check from google that would make you a freelancer ing to the definition if you do as a hobby some produce some necklace and sell it on etsy that will also make you a freelancer or if you do some babysitting for friends or family once in a blue moon for some pocket money that would also make you a freelancer so as you can see there is a huge problem with this definition because it counts as freelancers millions and millions of people who are basically full-time employees and who wouldn't identify themselves as freelancers as independent professionals another great example a golden mean of freelance stats would be done by mckinsey global institute and they did some really exceptional work with the taxonomy of freelance work they more or less see freelancers as the self-employed workers which is not really precise precisely in my opinion but they did a really good job and they estimated that the full-time freelancers make up 12 of the u.s workforce so as you can see this is already a huge difference well i often see the first number quoted not a second one but we may go deeper way more deeper the rabbit hole and look into reports that actually don't classify freelancers as a general self-employed population but who actually look at what these people do and this is exactly what fiverr did in their reports they are really outstanding i recommend you to to look into it and what they did is that they looked into over 20 million tax tax returns in the us for people who are non-employers who don't have employees and who work in a range of creative technical and professional services so these are people who are likely to call themselves freelancers and they counted only those who had at least one thousand dollars in the annual receipts so they they just skipped uh the the tiny incomes and they found out that these people make only 1.1 percent of the us gdp and the mere 3.8 of the total u.s workforce so as you can see this is a this is a huge issue because uh when we read about the future work and how many freelancers there are and when we actually go deeper into the definitions and look at the number of qualified independent professionals it's not 36 percent is nearly 4 percent something around that the number okay so let me move on to my two final misconception before i move on to some to some insights and conclusions and guidelines uh based on them and it is the misconception that the geek economy is basically the same as freelance economy well i admit that this is a blurry area um but i would just like to give you two brief reasons why it's always better to speak of freelance economy when we speak of freelancers first of all freelancers themselves overwhelmingly prefer the term freelance economy over on demand economy over sharing economy or uh over gig economy which was actually the least popular one among full-time freelancers ing to upwork now when you think of it it's totally understandable if you are if you think that you're an independent professional operating on a free market really a entrepreneurial person you wouldn't like to be called a gig worker or doing some gigs because you do projects you think long term you don't do short term work and you are not an asset to be you know traded on some on some platform you think of yourself as an independent person as an independent professional so it's understandable but the second reason why i believe it's useful to make the distinction is that when you actually look into serious reports about the geek economy you may actually find out that they are talking about slightly different thing because for example mastercard in their in their report from 2019 they reached the conclusion that 88 of the geek economy is basically uh related to transportation based services or asset sharing services companies like uber or mmb uh indeed those probably many of these people are those misclassified employees not not independent professionals you know free willing on the free market so uh so this is this has very little to do with uh independent professionals and the other reason would be when when when you actually go into the report and read the definition yourself they define the gig economy as and i quote digital platforms that allow independent freelancers to connect with individuals or businesses for short-term services or asset sharing well i have so many problems with this definition first of all short term not all freelancers do short term work uh asset sharing once again this is more like airbnb or or uber probably and but the most problematic word in my opinion is the world digital why because it leads me to my final misconception that freelancing is all about online platforms now i totally understand why people think of it this way because there are many online platforms for freelancers these companies have budgets they produce quality content they produce quality reports in some cases and so tense they tend to represent their part of the market as the as the most prominent most important but there is very little data to support this concept misha kaufman uh ceo of fiverr has been saying since 2016 at least at the and the company often reiterates on that claim that only three percent three percent of the freelance work is basically done online uh another source gig economy data hub great resource like aggregating various stats and reports related to freelance work uh claims that less than one percent uh of the u.s workforce is actually engaged in online platforms like uber airbnb lyft taskrabbit and others so so i don't say that uh online isn't important it is it's a huge trend it's it's growing it's it will be probably go growing for decades but it's still you know in essence freelancing is an old-school business and it is also confirmed by the studies done among freelancers so when we ask freelancers directly what are the top sources of their work they give answers like friends and family social media previous freelance clients professional contacts ing to freelancing in america survey in our survey 2015 these were personal recommendations contacts a website and a good name so as you see the majority of the freelance work comes through through weak and strong personal relationships this is an old-school business rooted deeply in our relation to society to the professional community so i went through all the four misconceptions that uh freelancer is the same as self-employed it isn't that freelancers make up more than one third of the of the workforce they don't unless you use some really super wide definition of a freelance work uh in reality is way way lower that a freelance economy is basically the same as gig economy uh it's debatable but uh i wouldn't agree with that and the final one that freelance work and freelancing is all about these online platforms that we often read about it is not it is the most of it happens really among us as freelancers so let me move on to three insights related to uh european freelance economy i was using the data from the us because because we have so many data on the us economy and and rather little on the european one so i would like just to check whether these two markets are representative of each other to some extent uh first of all i would just like to give you a short short guideline how to think of these independent professionals independent freelancers who are not gig workers who don't do who don't do dependent work uh there are many terms describing this type of works like full-time freelancers traditional freelancers full-time independence well i like the term independent professionals it relates to most people i know as freelancers and i like both of these words because independent makes you a really free person you know like entering the free market defining yourself and your expertise and looking for opportunities growing your career you know like you are really uh independent of others and you can you can you can set on this journey and reach very far and professional is also an important word because this means that these people are totally serious about what they do there are no temps no unqualified workforce these are people who identify themselves as professionals in a certain in a certain field of expertise so they are serious about growing their skills growing their expertise and one more important thing about this professionalism defined as such is a very old and ancient concept each one of you would be able to uh say how a real professional should behave you you have a probably preset expectations about professional work we think that freelancers or professionals should be honest should be real experts should treat well their clients should work diligently etc this concept goes very back very long back in time there were independent professionals in ancient rome around the period of roman peace and these people had basically the same requirements for success as independents because for example they had to be experts they had to produce quality work they had to find new clients and manage well the relationships with with their clients they have to be able to find helpers and find good helpers in order to support their their long time careers they had to manage well their finances in order to set prices well make profit and and create reserves so the idea of these independent professionals is really ancient it's really old and although we use new technologies in essence the free freelancing as it's as it is remains a very conservative way of doing business now let's move on uh well uh to my reality check here i selected this slide from a report by mbo partners from state of independence in america very nice report quality one i highly recommend it and uh i like this slide because it shows that uh the older generation cohorts uh like baby boomers earn on average way more than younger ones than generation x my generation and then millennials so once again we have this picture of people who are really serious about what they do they think long term they are not sprinting for quick profits they are building their independent standalone businesses they are growing their clientele they are growing their skills they are getting better at doing business and over a long time period they earn way more so this is what i mean when i talk about about independent professionals uh mbo uses a different term they they call them full-time independent workers but it's basically the same now let me move on to to this to to to the deeper insight about the european freelance economy now this is a tricky area because we have very little data to actually to actually study it but luckily there is a great report sponsored by aerofond and that report is basically about self-employed population but it also tells us something interesting about freelancers in europe and this is where we are moving to some some some practical conclusions uh first of all there were 222 million of the people in the ua workforce and there were 40 percent uh or 20 32 million of the self-employed once again you you see it's pretty similar as the uk number and the report actually used some pretty smart questionnaire to divide these self-employed into five independent clusters the first cluster was stable owned account workers the second were uh employers so self-employed who actually employ other people that's what i was talking about in my first misconception fed were small traders and farmers uh four where uh vulnerable and fifth concealed so probably misclassified workers uh when you actually go into the report and read these descriptions you may actually find out that the stable own account workers seem to be a great representation for freelancers because they define them as and i quote nearly all like being self-employed and do not find it hard to bear the responsibility the bergening power of the self-employed in this cluster is strong as they are very likely to have more than one client and can easily find new ones almost 90 percent are able to take time off at a short notice for private matters so this this looks like a freelancer the way i described it however the problem is that the most represented in these clusters are people like shopkeepers 3.9 percent hairdressers domestic cleaners and helpers and other professions who are not 100 likely to identify as freelancers because they may be presenting themselves as small businesses having a brand and you know like not really identify as independent professionals luckily the report also states that nine percent of the of the self-employed in europe identified as doing freelance work or full-time or part-time it doesn't matter uh so we make we can make a conclusion here that the number of freelance self-employed people in europe can be roughly estimated between 1.2 and 3.8 percent once again you see a pretty nice correlation to the conservative estimate given by fiber in the u.s and now this is really important um because four percent is not much it's it's quite little actually but you have to remember that we have to divide this number further because four percent even if it would be this most most like the higher par higher uh frontier of the of our estimate is for all industries there are there are dozens or hundreds of them and all professions and they are so even the most populated professions for freelancers would be only a tiny fragment of this small percentage and we have to divide further than that because if you are actually looking for freelancers there are another important uh factors so for example in any profession the number of people who are experienced who are really highly skilled is way lower than the number of people who are just beginners or who are you know just just starting out so that's one one issue another issue is that uh not all freelancers have free capacity so only a small proportion of freelancers has actually large capacity for a new work most freelancers tend to be booked up they don't have like free capacity 50 for anyone who comes by right like we try to optimize uh time spent money ratio so we try to be booked uh and finally many of the freelancers we are talking about here are just not online as i explained in my in my final misconception there there it's quite common with freelancers as i meet them and with my freelance friends that some don't have websites they may have dozens of clients without actually present themselves online and it also happens in in your industry in web industry it's quite common so we may be part of the social media but but but not you know like doing some serious presentation of us as professionals so this is this is important inside and let me move on to my third insight here uh about european freelance platforms like where to find european freelancers because this is this is one of the crucial points of my of my talk here uh as i said the uh the european freelance economy is totally fragmented and that is why we are we are building a resource that you may use freely at freelancing.eu countries where we are listing every single resource about uh from the european finance economy we find so these are freelance marketplaces freelance platforms freelance communities in some in some cases only well facebook groups for freelancers or blogs or podcasts so everything we find that is relevant to doing freelance business we just list on this website there are 362 resources in 35 countries we have been able to find so far and there are well three useful things you can do with the with this list first of all you may just look at it and see how how different those countries are there are countries like united kingdom germany or france where you have so many resources available there are so many communities there are your local communities there are the the support is really great for freelancers and there are other countries where we were hardly able to find a single resource that is active so the differences are really huge if you are an individual freelancer this is a very useful list for crossing borders most freelancers in europe uh i think uh web industry is a small exception here uh they are you know just uh heavily focused on their national markets so they do work with their clients i don't know czechs in czech are germans in germany so this is quite common it's it's uh it's not really common for freelancers to cross borders and to try to enter this european level in their profession and actually when you do it you may find out that the number of professionals who are established on the european level in your particular profession it's it's not huge it would this would be people that you would be you know uh seeing mentioning over and over again so we are as as europe we are strongly lagging behind the us in the u.s you have very well established pan-continental u.s freelance economy with celebrities i would say professional celebrities in europe this is only getting started and i really believe that this is a generational opportunity for us as independent professionals because if you go on this international level and you establish yourself in this decade this would be perhaps a single opportunity in your lifetime as a freelancer as a professional so it's very useful for for freelancers to think about these differences and if you speak the language just try to cross the borders and go there and and think about you know expanding your horizons it's really common for freelancers to be located somewhere and you know have the the personal contacts there and all the business related and for people who hire freelancers this is also very useful because uh that's where in some cases that's when you find the european freelancers who are not listed on uh marketplaces and this leads me uh to my final uh conclusions like based on all i've been discussing in this talk and i have two sets of insights or suggestions for first of all for people who hire top gun freelancers if you are a company or or hr expert you know like looking for experienced top gun professionals i would like to give you some some recommendations um first of all uh just four good marketplaces where freelancers bit against each other if you are a top professional you don't go to fiverr to bid against i don't know people from different parts of the world you know like bidding down to the bottom you don't need that because you are probably in high demand and you are trying to run your business based on your personal contacts based on your you know own ideas how your business should behave so just skip this level and rather search and enter freelance communities these are places where not in nature marketplaces but where freelancers network with each other and with potential clients and try to look for connectors there as well this would like speed up your research do the research you need to do it probably because of the reasons i've been giving that actually when you narrow down the definition the definition of the independent expert you may find out that these people are really rare so you have to you know search hard do the research and when you prepare your strategy two things uh have a budget these people can be really expensive they are they are professionals who are top experts in what they do and they charge thousands of euros per day and it's not totally rare it's not totally uncommon i know a number of these people be realistic about your negotiating position because it's rather weak these people have like really full calendars they are fully booked and you have to convince them you have to convince them that you are relevant to their vision of their career of where they are going as independent experts so these people they are they are really they are strong personalities another recommendation a rather obscure one i would recommend you to prioritize decision makers to deal with these top freelancers these top freelancers they try to avoid middle management because in their experience this this is often a waste of time because these people often lack the decision-making power and it may show later that uh that they are not able to make the final decision the final calls so it's always better to to prioritize decision maker for dealing with freelancers for with these top top-level professionals and trust and respect just build the relationship because these people are highly very valuable for you and your company and your project because it's not only in the terms of the work done but it's also in terms of their influence they usually have really vast networks of of real influence they are building over the years and if they trust your mission trust what you do they'll they'll start spreading the word they start convincing other freelancers to join and they they try to make other influences thinking about your work about your project so this would be my recommendations for people who hire freelancers and now uh my recommendations for uh for freelance friends for people who are freelance who are looking for ways to grow their freelance business and these are not general uh guidelines this is only based on what i've been talking about in this talk so this is not like a super broad uh recommendation first i can i cannot stress this highly enough uh as freelancers we have a number one superpower and this is where we build a complex professional network when we connect with each other and when we assemble unique teams unique friendships i would say and we employ this carefully selected networks for the benefit of our clients or for the benefit or our community and for the benefit of you know your profession in general many freelancers top-level freelancers are actually movers of their profession because they are you know like going into new trends that you know doing research they're publishing so they are they are highly visible in the relation to where the general profession is going uh so once again uh uh competition is not our game as freelancers we are best when we cooperate so try to build on that try to enter freelance communities if you are isolated i know that many web developers in the past recently it's way way less uh tended to be isolated because they worked as a contractors for a single client or single or two clients perhaps and they didn't find it you know that useful to network with colleagues this is this is absolutely a must if you if you think about freelancing as actual business so try to build your network uh uh find great colleagues uh find mentors for find consultants that you may use to discuss the business cases that you are dealing with as i said europe is the future so cross borders join projects explore and uh last but not least uh as i explained you are you are rare you are really rare on the market if you have a like some some uncommon expertise but you probably don't price your work as such pricing is the most and evaluated freelancing skill there is most freelancers i work with as a independent consultant underprice the work and what's even worse clients who think that there are many freelancers that can be easily hired which in reality isn't that easy tend to undervalue the freelance work so try to work on your pricing and and become a better negotiator this is this is important okay some some final final thoughts about the future freelance entrepreneurs i i would just like to conclude here uh with three ideas first of all i re i strongly believe that proportion of online communities online collaboration between freelancers will be growing for decades to come there is as i said like if it's three percent or five percent or ten percent no one really knows because it depends on the definition of the freelance work as you as you've seen but definitely there is a huge space to grow to expand so this is also a great opportunity for people in the web industry who are thinking about you know like employing other freelancers and drawing these people who are totally offline into the online communities you will be building so this is a huge trend and it will go on secondly european freelance economy is being formed so you have a one single generation opportunity to to join on this level and became well europe-wide well-known professionals that are established in your professions and who is able to cross borders both in terms in your networking and and clientele as well as educator or public speaker whatever whatever you prefer and the third i would i would i would say that although we have these new technologies uh new possibilities working online etc i would say that the freelancing the freelance business itself in its core will remain conservative as ever it will be based probably will always be based on these you know personal relationships on this you know trust built between people and i think it hasn't changed much over the couple of centuries and i don't think it will change much over the next decades this is how this is who we are we see ourselves as independent people as free people free willing the free market and we see a value in this independence you know so we will not easily trade our independence for any sort of benefits this is a strong value for us freelancers and i believe it will remain so so thank you for attention [Applause] you