Tech & Work

Is the permalancer a corporation's dream?

A permalancer, or a permanent freelancer, is a person originally hired at a company on a contract basis, but who essentially becomes a full-timer (though without the perks and benefits of a full-time employee).

The upside to being a permalancer is, of course, employment. You work in the office and use company equipment. The downside is that permalancers don't get the health benefits, paid holidays, or access to a 401K that permanent staffers do, and are often the first people to go in a layoff.

The benefit to corporations is that in a permalancer they get a full-time employee without having to pay full benefits and payroll taxes on that person.

According to an article from Portfolio.com:

The IRS, in order for health insurance to be excluded from taxable income, requires all company employees to receive it. But employers and employees with seniority have gotten around that by hiring the young as "freelancers" and "contractors," a category that includes a growing share of the workforce.

Last December, the VH1 network, which is owned by Viacom, announced that it would be curtailing the benefits of the company's permalancers. The permalancers then staged a walkout, causing Viacom to reconsider its position. It restored the benefits and some permalancers were offered staff jobs.

Are any of you out there permalancers? If so, what has been your experience with company benefits?

About

Toni Bowers is Managing Editor of TechRepublic and is the award-winning blogger of the Career Management blog. She has edited newsletters, books, and web sites pertaining to software, IT career, and IT management issues.

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