The Costly Lesson

I recently heard a sad story about a skilled tradesman who agreed to do a project for a contractor.   The tradesman completed the work and then went to collect his pay.  The contractor was not there.  The tradesman went back the next day and the day after – still no contractor.  No one on the job site knew where the contractor was and hadn’t seen him since the tradesman had.

The tradesman went to the builder and learned that the contractor had been paid the day he was supposed to be.  The guy had literally disappeared.  The tradesman had worked for a week and a half, finished the work he was to do and didn’t get paid. He was out the $2000 he was supposed to be paid.  There was nothing he could do about it because he couldn’t take back or undo the work he did.

There are some practical things every gig worker must do to protect themselves and ensure that they aren’t taken advantage of:

  1. Know what the value of your work is and establish the price for it accordingly.
  2. Make sure you know who you are working with – name, address, phone number and what the status of the person you are talking with is – an owner, a contractor, a subcontractor.
  3. Establish the exact work that is to be done, what the expected results are and the key completion stages during the project.  At each stage of your work, have the person you are working with sign off on the work as having been completed satisfactorily.
  4. Establish a fair price for the work and obtain a deposit for at least 10% of the total price of the agreed-upon work, before starting the job. Don’t do any work until you receive your deposit.
  5. Establish the amount to be paid at each of the key points during the project. Always get your payment before you start the next stage of the work.
  6. Establish the way the payment is to be made: the best option for all gig workers is e-transfer because you know you have the money. Always check your bank account to be sure the transfer has been deposited.

Some other important things:

  1. Ask other workers in your industry if they know of the person you are thinking about working with and find out what that person’s reputation is.
  2. Be careful not to charge too little.
    • There usually aren’t any benefits, income taxes, EI or CPP payments made in these types of work arrangements. Those are costs you need to cover.  If you are doing work where WCB is required be sure the coverage includes gig workers.
    • If you cut your rate below that of others just to get the work, others will do the same thing and before long the work will be poorly paid.
    • If you underprice the work you do, others will not see it as being valuable.
  3. Be sure you maintain and develop the knowledge and skills necessary to deliver the product/service at the quality expected, and on time. AND learn the managerial skills that are essential to be a successful entrepreneur.

Questions or comments? Email me at: anne@annehoward.com

About Anne Howard Human Resource Consulting

Anne holds a BA (Sociology) and a Masters in Business Administration (MBA)and a certificate in Human Resource Management.  She also holds Certified Management Consultant (CMC) and Certified Human Resources Professional (CHRP) designations and . . . . . .  Anne continues to engage in ongoing training to remain at the top of her field. She is practical, realistic, highly analytic, and creative.    Anne is also a Sessional Instructor in the Bachelor of Business Administration Continuing Education department at Mount Royal University. Anne is unique in her ability to see the broad scope vision of the business owner, determine what is required to reach that goal and, then design the appropriate Human Resource Management processes.
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