In the 1980s, the world was introduced to the word “entrepreneurship”. In simple terms, it’s the world of self-employment. By the 1990s, many people had entered the world of entrepreneurship, believing that self-employment would be better than working for Corporate America.

Before the COVID-19 pandemic, it was estimated that 13 percent of businesses owners in the United States were self-employed. Now that we know that COVID-19 is going to be part of our lives for a long, long time, a debate is underway within Corporate America that could shake up our new normal (once again), and dramatically affect our jobs. Will we have a job with (or without) union benefits and regular pay increases, or will we become “independent contractors”?

In fact, now that many business owners realize that a substantial part of their business operations can be carried out directly from employees’ homes, they are considering permanently transforming part of their business into a “work-from-home” model. On the other hand, many employees are finding that working from home, including working in their underwear, can be better than working at the office.

So, if Corporate America gives you a call to talk about a new job title, it will probably not be because of a promotion. It will not come with a pay increase. In fact, it may not come with the same pay at all, and it may not even come with union benefits, or an employee benefit program like health insurance or a 401k program. Instead, your new title will be what it has been called since the 1980s. You will be called an “independent contractor”.

Successful independent contractors, even before the pandemic, gave up these aforementioned benefits, opting instead to take, on average, a 35 percent cut in pay compared to what their office counterparts in Corporate America were earning. Why? Because they voluntarily gave up those perks in order to work from home, be closer to their families, and work in their underwear if they wanted.

Given the current economic climate, with money already scarce, it’s likely that a home-working model will not be accepted voluntarily by employees! However, they may not have a choice since the rate of independent contractors in the United States is suspected to increase from 13 percent to as high as 25 percent in the future. Many don’t realize that employee benefit packages cost business owners as much as 30 percent of an employee’s salary. With this cost eliminated for employers who have their employees become independent contractors, they can then use the difference to easily decrease or increase their employees’ pay.

But do you think employers are going to give you, the employee, that difference? Not with the current state of the economy as it stands today, they won’t, and not with over one million people a week applying for unemployment insurance.

The year 2020 will be remembered for several things. One, sadly, for people in Corporate America, is the legitimate threat of their jobs being restructured, their titles, their salaries, and possibly their classic U.S. union structure as well. After all, employees who work from home will no longer have to worry if they take 54 smoke breaks, take care of their home life during business hours, or occasionally play on social media without fear of getting fired, so who will need a union? What’s worse is that there is currently no real union representing such independent contractors right now.

So what can you do to prevent this new potential working model? Nothing really! After all, it won’t be your choice, unless you get ahead of the curve and negotiate with your employer now!

Professor Anthony Rivieccio, MBA PFA, is the founder and CEO of The Financial Advisors Group, celebrating its 24th year as a fee-only financial planning firm specializing in solving one’s financial problems. Mr. Rivieccio, a recognized financial expert since 1986, has been featured by many national and local media including: Kiplinger’s Personal Finance, The New York Post, News 12 The Bronx, Bloomberg News Radio, BronxNet Television, the Norwood News, The West Side Manhattan Gazette, Labor Press Magazine, Financial Planning Magazine, WINS 1010 Radio, The Co-Op City News, The Bronx News, thisisthebronX.info and The Bronx Chronicle. Mr.  Rivieccio also pens a financial article called “Money Talk”. Anthony is also currently an Adjunct Professor of Business, Finance & Accounting for both, City University of New York & Monroe College, a Private University. You can reach Anthony at 347.575.5045. 

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Welcome to the Norwood News, a bi-weekly community newspaper that primarily serves the northwest Bronx communities of Norwood, Bedford Park, Fordham and University Heights. Through our Breaking Bronx blog, we focus on news and information for those neighborhoods, but aim to cover as much Bronx-related news as possible. Founded in 1988 by Mosholu Preservation Corporation, a not-for-profit affiliate of Montefiore Medical Center, the Norwood News began as a monthly and grew to a bi-weekly in 1994. In September 2003 the paper expanded to cover University Heights and now covers all the neighborhoods of Community District 7. The Norwood News exists to foster communication among citizens and organizations and to be a tool for neighborhood development efforts. The Norwood News runs the Bronx Youth Journalism Heard, a journalism training program for Bronx high school students. As you navigate this website, please let us know if you discover any glitches or if you have any suggestions. We’d love to hear from you. You can send e-mails to norwoodnews@norwoodnews.org or call us anytime (718) 324-4998.