The gig economy is exploding, with more and more industries tapping into the supply of workers who want flexible ways of earning extra money. As the term becomes more widely used, and gig work becomes more common, many people are confused about what a “gig worker” is and how they differ from traditional employment.
Gig Work Defined
Gig workers are people who sign up with a company that provides on-demand workers or services. For example, an Uber driver is a gig worker who enters into a contract with Uber to provide rides to Uber clients. The driver can work when they choose and can accept or decline a particular assignment.
Gig work could be something a person does once in a while for extra money, or a person could take frequent gig assignments as a person’s sole source of income. Some people might have a day job and regularly accept gigs doing something completely different, like a teacher taking gigs as a bartender or a pet sitter.
Other people might take gigs in their own industry to earn extra money. For example, HapiGig is a platform that provides gig opportunities to workers in the warehouse industry. A person with warehouse experience might look to earn extra income through gig work, taking extra shifts at other warehouses in their local area.
Employees or Not?
One of the appeals of gig work is its flexibility. Gig workers usually have some choice about when they work, how often they choose to accept assignments, and the type of work they will do. They have the right to refuse opportunities for any reason.
Employees typically have a relationship with an employer that requires them to devote a certain number of hours per week to the relationship. They might get a specific number of vacation days or holidays, but they often must schedule their time off in advance.
W2 Versus 1099
Most gig workers are independent contractors while doing their gigs, though they might also be employees at their full-time job. As independent contractors, they are not entitled to benefits like paid time off or health insurance. Gig payments usually do not have state or federal taxes, social security, or other withholding taken out. The workers usually must file quarterly tax returns declaring their gig earnings. Each year the employer files a 1099 reporting the wages they paid the contractor.
Employees, on the other hand, are usually entitled to employment benefits if they work full-time. Their employers withhold state and federal taxes, social security payments, unemployment insurance payments, and other deductions from their paychecks. Employers issue a W2 every year showing what the employee earned and the amount withheld. An employee needs to file taxes once a year and could receive a tax refund.
Some gig work platforms offer a hybrid model. HapiGig hires warehouse workers as W2 employees. When employees accept assignments, the company pays them and withholds taxes from their checks. This frees the employees from the need to file quarterly tax returns.
Gig Work Provides Income with Flexibility
Whether you want complete control over your schedule and work gigs exclusively, or you use gigs to supplement your primary income, there are many ways to make gigs work for you.
If you have warehousing skills, there is a huge demand for gig workers. Contact HapiGig through our website or on social media to start benefitting from the gig economy today.