Becoming a Contractor Does Not Change What You Sell

Introduction: The Contract Changed; the Days Did Not

People who switch from an employment contract to a contractor arrangement notice something after a while. The name on the paperwork changed. The relationship of instruction and command has, in form, disappeared. And yet the daily felt sense has barely shifted at all. Chased by deadlines, reading the client’s intentions, rearranging the schedule around changes to the spec.

The differences between contracting and employment, and what to watch for in the paperwork, are already well documented. What this article takes up is the question sitting just before it. When the form of the contract changed, did what you sell actually change?

Here is the conclusion first. It did not. Under an employment contract or a contractor arrangement, what is sold is the same thing: your own labour power. What changed is only how it is sold; the structure of living by selling labour power is shared across both, untouched.

Sold in Bulk or Sold Piecemeal — That Is the Whole Difference

Labour power means the capacity to work itself — physical stamina, skill, time, attention. For someone who holds no means of production (the tools, equipment, capital and mechanisms for generating a living), this is the only thing available to sell for a living.

An employee sells that labour power in bulk, to one buyer called the company, in the form of a monthly salary. Someone working as a contractor sells the same labour power piecemeal, to several clients, in the form of per-project fees.

The manner of selling differs. In bulk, or piecemeal. But what is being sold is the same. And so is the structure of obtaining a return by selling labour power.

What hides this sameness is the contrast between “the employed, who are exploited” and “those who earn by their own strength.” Emotionally the contrast goes down very easily, because being employed carries an overtone of subordination and earning for yourself carries one of self-reliance. But this contrast looks only at surface form and not at the structure beneath it.

Why Raising Your Rate Does Not Change Subordination

Let me examine an equation many people hold. Hone your skills and your rate goes up. With a higher rate you earn the same from less work. That frees up time, which brings you closer to freedom.

The first half is correct. Hone your skills and the fee per job really can multiply several times over. The second half, however, does not materialise. With the rate up, you are as busy as ever, answering as many parties as ever, as unable to rest as ever. As the fee rises, so does the standard demanded, and the expectations grow heavier. High-rate work is embedded that much more deeply beneath the other side’s decisions.

You have only become able to sell yourself at a higher price; from the structure of selling you have not stepped out one pace. The more you hone your skills, the more expensive a form of labour power you become — and the more deeply, as expensive labour power, you become subordinate to the market.

Let me restate what is happening here precisely. Honing skills and raising rates is the work of improving the quality of your labour power: making labour power that sells for more. This does not touch the condition of holding no means of production at all. What is being honed is “yourself as a thing for sale,” not “a means of living without selling labour power.”

Raising the quality of labour power and holding means of production sit on entirely different axes. However thoroughly you pursue the former, you can never arrive at the latter.

▸ That this same distinction applies to the achievement of “earning under your own name” is taken up in earning under your own business name is not ownership.

The Deciding Is Always on the Other Side

What does not change when the rate rises comes down to one point: who, in the end, decides what gets made and what it sells for.

You can obtain a high fee because the market wants that skill and the client accepted that price. Let the skills the market wants change and the rate falls. Let the other side decline the price and the work does not happen. The decision is always on their side. Someone working as a contractor has merely become the more highly valued party on the ground of the other side’s demand; they have not drawn that ground itself over to their own side.

Meanwhile, what time to get up, what to wear while working, where to work — these you really can decide. What the story of independence displays as freedom is, in most cases, this kind of decision. Decisions belonging to the surface of life are obtained; decisions that govern the root of life are not — this asymmetry is the true picture of the contractor arrangement.

Conclusion: The Question Sits Outside the Form of the Contract

There is nothing wrong with the contractor arrangement in itself. What is cut is the way of speaking that paints a change in the name of the contract as release from subordination, and hides the structure shared beneath it.

If employment and contracting are the same on the single point of living by selling labour power, then “which contract do I work under?” stops being an essential question about freedom. It is merely a choice of means about how labour power is to be sold. The essential question sits before that. Do you remain inside the structure of selling labour power, or do you look for a road out of it?

The road out means holding some proportion of the decisions about production — what gets made, and what it sells for — on your own side. The whole picture is gathered in why starting a business does not free you from masters. Not the line dividing employees from the independent, but the line dividing those who sell labour power from those who hold means of production. That is where the parting of freedom lies.

References

Academic papers and theory

• Marx, K. Das Kapital, Band I (1867) Verlag von Otto Meissner
• Uno, K. Principles of Political Economy (1964) Iwanami Shoten