Sara Horowitz

Ashoka Fellow
Sara Horowitz
United States
Fellow since 1995
This description of Sara Horowitz's work was prepared when Sara Horowitz was elected to the Ashoka Fellowship in 1995.

Introduction

Sara Horowitz, a former labor lawyer, founded America’s first freelancer’s union to help independent workers access benefits and insurance and gain a political voice.

The New Idea

Sara Horowitz is founder and CEO of the Freelancers Union, a first-of-its-kind union that is building a 21st century social safety net for a changing American workforce. Traditional employer-based benefits and insurance simply do not apply to the 30 percent of Americans who work as freelancers. As a result, many of these workers are saddled with expensive premiums or live dangerously without insurance. What began as Working Today in 1995 spawned the Freelancers Union in 2003 with the simple goal of providing all working people with affordable benefits, regardless of their job arrangement.

The Freelancers Union is a free membership community that represents the needs of America’s growing independent workforce through advocacy, information, and service. The union helps independent workers access key protections such as health insurance and other benefits by building links with professional associations, membership- and community-based organizations, unions and companies. The benefits are unique because they are linked to individuals rather than employers – making them portable and thus more reliable for a workforce that moves from job to job or assignment to assignment. The Freelancers Union also educates policymakers and the public about the needs of independent workers and provides its members with a community of solidarity through which they can share information and resources and advocate collectively.

Today the Freelancers Union enjoys a membership of more than 160,000 workers in all of the 50 states and across a diverse range of professions, from television to health care to financial services. It has been instrumental not only in providing flexible benefits to its members but also in showcasing a new model of organized labor that relies less on traditional collective bargaining with management and more on market purchasing power. Sara has won a MacArthur Fellowship for her work and is currently focused on organizing retirement accounts for independent workers.

The Problem

Independent workers make up 30 percent of the American workforce. That’s more than 40 million freelancers, consultants, independent contractors, temps, part-timers, contingent workers, and self-employed. Yet despite their contributions to our economy, those in the so-called “gig economy” are taxed more than traditional employees, can't access affordable health insurance, and have limited access to protections such as unemployment insurance, retirement plans, and unpaid wage claims. This is because as “free agent” laborers they are unable to benefit from group rates and insurance plans that are sponsored by employers. As a result, nearly one in three independent workers does not have health insurance, and many are vulnerable to economic hardship as a result of workplace injury, job loss, and other unforeseen events.

The American economy has been moving in this direction for some time. Nearly every major trend – globalization, technological innovation, outsourcing – is creating demand for flexibility and specialization in our workforce. Some see this as an opportunity, and others as a necessity, to be freelancers. On one side are those workers who leave traditional jobs and strike out on as entrepreneurs, consultants, writers, real estate agents and more. On the other are workers with little education and training who have been forced by employers into accepting independent contractor arrangements with low pay and status and no health, pension, or retirement benefits. The problem is especially poignant as America struggles through the Great Recession, where according to Sara, the question is not only whether someone is working full-time or out of work, but also whether someone is employed in small, medium, or large ways – which can mean the difference between having insurance or not.

America’s social safety net, which was designed for the manufacturing era, is outdated in terms of this group of workers, and is not equipped to provide security for those with episodic incomes, few affordable benefits, and lack of legal recourse. The result is a growing group of American workers who live without essential benefits, and who until recently had few avenues through which to organize and collectively advocate for their rights and well-being.

The Strategy

The Freelancers Union provides its members with benefits, a collaborative community, and political representation so that independent American workers can be secure and thrive, no matter how they work. Unlike traditional unions, the Freelancers Union does not engage in collective bargaining for wages and lacks the conventional hierarchical structure of elected union leaders. It also has no company, geographic, or industry common thread, but rather welcomes members of all kinds who share the status of freelancer. However, Sara’s Freelancers Union does implement traditional labor strategies of using the market power of large groups to help freelancers access better benefits, and it has organized a decentralized group into a constituency capable of powerful collective action. Indeed, strength in numbers is strength in markets and strength in politics. And while the value of grouping hasn’t changed, Sara believes the way people are grouping themselves in today’s world—workforce and otherwise—is and should be changing.

The Freelancers Union uses its strength in numbers to gain its members access to affordable and high quality benefits. In 2001, it created an infrastructure platform known as the Portable Benefits Network (PBN), which provided health insurance to independent workers at less than half the price of average HMO premiums in the individual market in New York City. Within five years, nearly 12,000 independent workers received benefits through the PBN. In 2008, Sara replaced PBN with the Freelancers Insurance Company (a wholly owned for-profit company) to offer heath insurance to its members. In addition, the union has partnerships with other agencies offering affordable dental, life and disability insurance. Where it cannot yet offer benefits directly, the union refers members to other providers, for example those providing flexible and affordable mental health and therapy plans. It also offers members discounts on everything from workspace to gym membership to tax preparation. In August 2006, Freelancers Union launched a web portal with new services available to freelancers anywhere in the US, including job postings, message boards, and member profiles.

To be eligible for insurance, applicants must a) be an independent worker, b) be a U.S. resident, c) work in an eligible industry or occupation and d) have documentation showing 20 hours worked in the last 8 weeks or earned at least $10,000 in the last six months.

The union regularly engages in organizing and political advocacy – which is how Sara now spends most of her time. In 2009, it was instrumental in the reform of New York City’s unincorporated business tax, which had double-taxed freelancers’ income as both business and personal revenue. The union also successfully lobbied the state legislature to codify independent workers’ rights to group together for health insurance, paving the way for a push for a national, portable-benefits network. In 2010, the Freelancers Union helped draft legislation to expand wage and hour protections enforceable by the state labor department after its own survey of 3,000 independent workers found that 40 percent had had trouble getting paid at least once within the last year.

The new frontier for the Freelancers Union is in retirement plans. Without access to traditional 401(k) plans, most freelancers underfund their retirement accounts, if they have them at all. Sara is working on ways to apply the same principles to financial planning that she has to health insurance: making a service more affordable by grouping people together. She recently developed the Freelancers Union 401(k) in partnership with Charles Schwab Trust Company and Milliman to make it easier for independent workers to save for retirement.

The Freelancers Union is based in Brooklyn, New York, with half of its members living in and around New York City. In recognition of its goals, the union has received grants and other support from New York City and State, and from leading foundations such as the Ford Foundation, John D. and Catherine T. MacArthur Foundation, J.P. Morgan Chase Foundation, New York Community Trust, United Hospital Fund, Rockefeller Family Fund, The Robert Wood Johnson Foundation, The Rockefeller Foundation, New York State Health Foundation, The Prudential Foundation, New York City Investment Fund, Ira W. De Camp Foundation and others. The organization is a four-time winner of Fast Company's Social Capitalist Awards.

The Person

The Freelancers Union provides its members with benefits, a collaborative community, and political representation so that independent American workers can be secure and thrive, no matter how they work. Unlike traditional unions, the Freelancers Union does not engage in collective bargaining for wages and lacks the conventional hierarchical structure of elected union leaders. It also has no company, geographic, or industry common thread, but rather welcomes members of all kinds who share the status of freelancer. However, Sara’s Freelancers Union does implement traditional labor strategies of using the market power of large groups to help freelancers access better benefits, and it has organized a decentralized group into a constituency capable of powerful collective action. Indeed, strength in numbers is strength in markets and strength in politics. And while the value of grouping hasn’t changed, Sara believes the way people are grouping themselves in today’s world—workforce and otherwise—is and should be changing.

The Freelancers Union uses its strength in numbers to gain its members access to affordable and high quality benefits. In 2001, it created an infrastructure platform known as the Portable Benefits Network (PBN), which provided health insurance to independent workers at less than half the price of average HMO premiums in the individual market in New York City. Within five years, nearly 12,000 independent workers received benefits through the PBN. In 2008, Sara replaced PBN with the Freelancers Insurance Company (a wholly owned for-profit company) to offer heath insurance to its members. In addition, the union has partnerships with other agencies offering affordable dental, life and disability insurance. Where it cannot yet offer benefits directly, the union refers members to other providers, for example those providing flexible and affordable mental health and therapy plans. It also offers members discounts on everything from workspace to gym membership to tax preparation. In August 2006, Freelancers Union launched a web portal with new services available to freelancers anywhere in the US, including job postings, message boards, and member profiles.

To be eligible for insurance, applicants must a) be an independent worker, b) be a U.S. resident, c) work in an eligible industry or occupation and d) have documentation showing 20 hours worked in the last 8 weeks or earned at least $10,000 in the last six months.

The union regularly engages in organizing and political advocacy – which is how Sara now spends most of her time. In 2009, it was instrumental in the reform of New York City’s unincorporated business tax, which had double-taxed freelancers’ income as both business and personal revenue. The union also successfully lobbied the state legislature to codify independent workers’ rights to group together for health insurance, paving the way for a push for a national, portable-benefits network. In 2010, the Freelancers Union helped draft legislation to expand wage and hour protections enforceable by the state labor department after its own survey of 3,000 independent workers found that 40 percent had had trouble getting paid at least once within the last year.

The new frontier for the Freelancers Union is in retirement plans. Without access to traditional 401(k) plans, most freelancers underfund their retirement accounts, if they have them at all. Sara is working on ways to apply the same principles to financial planning that she has to health insurance: making a service more affordable by grouping people together. She recently developed the Freelancers Union 401(k) in partnership with Charles Schwab Trust Company and Milliman to make it easier for independent workers to save for retirement.

The Freelancers Union is based in Brooklyn, New York, with half of its members living in and around New York City. In recognition of its goals, the union has received grants and other support from New York City and State, and from leading foundations such as the Ford Foundation, John D. and Catherine T. MacArthur Foundation, J.P. Morgan Chase Foundation, New York Community Trust, United Hospital Fund, Rockefeller Family Fund, The Robert Wood Johnson Foundation, The Rockefeller Foundation, New York State Health Foundation, The Prudential Foundation, New York City Investment Fund, Ira W. De Camp Foundation and others. The organization is a four-time winner of Fast Company's Social Capitalist Awards.