Unsupported, Uninsured, Unsustainable: The effect of contracting on young professionals

From June to December of 2019, the Collections on Contract team circulated an informal survey on social media with the goal of capturing a very preliminary picture of who heritage contractors are, what circumstances have led to their seeking or accepting contract work in the heritage sector, and any personal and professional impacts of working on a contingent basis. From the beginning of this project, the team has been interested in how the increasing reliance on independent contracting in libraries, archives, and museums has affected heritage professionals personally and professionally, especially those who are in the early stages of their careers. While this survey by no means provides a comprehensive picture of the landscape of contingent labor in the Libraries, Archives and Museum (LAM) field, it does confirm much of the anecdotal reporting circulating in social and professional circles and serves as a starting point for more fulsome conversations.

SURVEY SNAPSHOT

117 LAM professionals across more than 40 institutions responded
Slightly over 60 percent of those interviewed are current or former independent contractors
The majority of respondents work in the U.S. but there were also a few respondents from Canada, the UK, and Israel
94.7% of respondents are women
90.5% of respondents are white
44.8% are under the age of 35

Three Important Takeaways:

Almost 70% of respondents feel that working on contract has impacted their health in some way:

Forms response chart. Question title: Has contracting impacted your mental or physical health? . Number of responses: 68 responses.

The majority of contractors feel that their status as contingent laborers leads to job precarity:

Almost 80% of current and former contractors feel that they receive less support and resources than other employees in the workplace:

Forms response chart. Question title: Have you ever felt that your status as a contractor has left you with less support or resources than other employees?. Number of responses: 68 responses.

So What?

These responses indicate that most contingent laborers are young (35 or under), woman-identifying early-career professionals who find that the experience of contracting leaves them without access to the same resources as their colleagues, benefits, and general job stability. This is hugely important, considering that job stability is a determining factor in an employees overall health (Kuhnert et al., 1989, Ferrie et al., 2002). While this survey was hardly all-encompassing and there are a number of other questions or follow-ups the responses raise, it does provide a window into the way that contracting is impacting the lives of people across the LAM world. Ultimately, we find that these results confirm a lot of the things we have heard anecdotally from colleagues, peers, and LAM workers we’ve connected with online. Furthermore, while the survey presents the LAM contingent workforce as predominantly comprised of young, white women this does not necessarily accurately present the place or experience of workers of color who may not be able or feel welcome to participate in either mainstream professional societies and groups, or our survey.The fact that the majority of respondents feel they receive fewer resources and support than their peers who are full-time staff is troubling, especially considering the wider trend across the LAM industry toward outsourcing many full-time permanent positions to short-term contracting. This trend indicates that there is a growing population of young professionals who are working full-time jobs for the same employers for years at a time but not being afforded the same (or any) benefits, support, and resources as their co-workers. It is also important to remember that the term ‘benefits’ encompasses more than just health care (though that is a very important aspect). But benefits also include sick leave, vacation, and commuter subsidies that are a large part of what makes long-term employment sustainable for most people. By denying contractors these assets, what the LAM field is essentially doing is alienating 90% of the incoming, highly qualified workforce and ultimately forcing many young professionals out of the field.

Another important point to highlight: while we at CoC actively choose to focus on how contracting can be unsustainable and harmful for contingent laborers in the LAM field, this is by no means the experience of all people working on contract. For instance, one respondent said this:

“Regarding contracting impacting physical/mental health – my answer is yes, but I didn’t have a space to say “for the better”! This survey assumes one works for an institution, which two of my contracted clients are not. This bias skews some of my answers”

It is our goal to learn how people like this make contracting work for them so we can share tips and tricks with our whole community!

Here are some further anonymous testimonials we collected through the survey that help illuminate the nuance of some of the statistics we’ve presented:

“I have been a contractor for five years. During that time, due to processing errors/delays, I have had a total of 9 months of unpaid time off between contracts. I have repeatedly been referred to as ‘just a contractor’, as if being a contractor instead of federal staff negates my education and experience. I have had months pass between paychecks. And all of this has been met with ‘well that’s what it means to be a contractor’ as if I deserve to be treated as less-than because of my employment status.”

“First, the generalized stress of insecurity is hard to quantify or explain. Also, I am not included in conversations that should include me, because the org does not want to pay those hours — so that results in more work for everyone in the long run.”

One final takeaway from the information we’ve received that begs further discussion is that the individual experience of the role a contractor does and should play in an institution varies a great deal. Some responses indicated clear boundaries between what an ‘employee’ can and should do, while others indicated that institutionally, contractors and employees were expected to perform in very similar ways.

Ultimately, we find these responses to be concerning. The majority of feedback indicates that there is a large and growing percentage of young professionals in the libraries, archives, and museums field that are increasingly being forced into jobs that provide minimal security and no benefits. Apart from devaluing these individuals, this pattern of precarious job stability and lack of benefits is affecting the health and wellness of the vast majority these young professionals. It is clear that this model of employment across the LAM sector is not only unsustainable but also actively harming the field as a whole.

Do these responses resonate with you? Do you have a completely contrary experience or opinion you’d like to share? We would love to hear from you! Reach out to us via email at collectionsoncontract@gmail.com or find us on Twitter at @ContractOn !

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Quarterly Taxes: Best strategies for responsible estimates

One of the biggest questions first-time contractors have is often “How do I pay taxes as a contractor?!” and while navigating the tax system can be a nightmare in even the best of times, it turns out that paying taxes as a self-employed individual isn’t as hard as you might think! Read on for a basic overview of what quarterly taxes are, how to pay them, and tips on keeping ahead of the payments.

First and foremost, some background information for anyone out there who isn’t yet contracting or who isn’t sure why exactly self-employed individuals have to pay taxes differently than anyone else. In a “normal” job, your paycheck has all your taxes (and healthcare and retirement, when applicable) automatically withheld, but as an independent contractor taxes etc. are not taken out of your paycheck. While this can be a good thing because your paychecks are larger than other people working at your same rate, it is good to keep in mind that, after taxes, you’re losing a good part of your paycheck. It is all too easy for new independent contractors to get into the habit of spending 100% of their paychecks, only to realize, come quarterly tax time, that they don’t have enough money left to pay taxes.

So, that being said, what exactly are quarterly estimated taxes? Well, they’re pretty much exactly what they sound like; 4 times a year, you make an estimated guess about how much you’ve made over the past quarter and calculate approximately how much you will owe in taxes, both state and federal. While this may sound difficult, we have found that there are a few simple things you can do to make staying on top of your quarterlies a breeze.

The easiest way to make sure you can always pay your quarterlies is to simply set aside a portion of your paycheck as soon as you get it! State taxes can differ slightly, but a good rule of thumb is to set aside 25% of each paycheck for federal taxes, and around 5% for state. Experiment with this as needed and adjust your percentages if you find you’re too low, but this amount works for most people. So, all together, you want to set aside a full 30% of your paycheck as soon as you get it. It might hurt a bit at first, but this will ultimately make it easier for you to budget your income and to not have to worry about taxes every quarter. The best way to consistently do this is to start an excel sheet for your income- every time you get paid, record the amount, date paid, and what 30% of the amount is equal to. Bonus points for also calculating how much to set aside for your SEP-IRA!

When it comes to setting aside the money for taxes, we have found that the most fool-proof option is to simply open a checking account that will be used exclusively for taxes. Just make sure you order an actual checkbook to accompany this account. If you’re someone who’s likely to be tempted to spend what you’ve set aside, maybe even go ahead and just throw away the debit card that you will receive with your new account. Just cut it up, and don’t give yourself the chance to spend any money from your tax account.

From here, paying your taxes is actually the easy part. About a week before the deadline (usually mid April, June, September, and January, but the specific dates change from year to year), set a few minutes aside to sit down and write your checks. It’s usually a good idea to double-check your numbers one last time, and the easiest way to do that is to simply add up how much you’ve been paid between the last time you paid quarterlies and the end of the previous month- for example, if you’re paying your mid-April taxes, you will be covering everything you made for the period between January 1 and March 31st. This is where that spreadsheet becomes crucial! Take your total income for the tax period, and find 25%. Then write a check to the IRS for that amount, and complete the accompanying form. Specific instructions, as well as the forms for each quarter can always be found on the IRS website.

Now it’s time to pay your state taxes. The process for this differs by state, but it will generally look very similar to the IRS process. Simply double-check your income once more, calculate 5% (or whatever number you have found works best), write a check for that amount, and follow your state’s instructions for mailing in your taxes.

There you have it- the relatively easy and fool-proof way to stay on top of your quarterly estimated taxes! As always, if you have a different and also awesome way of doing your quarterlies, we’d love to hear it, feel free to reach out!

Featured

Welcome to Collections on Contract!

CoC was started by two people who both make our living contracting in museums. Based on our experiences and the testimonies of our colleagues, we have become acutely interested in and concerned with the state of contract labor in libraries and museums today and what relationships between contractors and contracting institutions do, and should, look like. Our goal with this platform is two-pronged: to establish a supportive and reliable community of heritage professionals working on contract and to conduct a methodological deep-dive into the ways that growing reliance on contract labor affects heritage work within institutions.

Through the creation of a collaborative community forum, we want to invite individual contractors from diverse areas of the heritage sector to share stories, experiences, advice, and resources to make contracting work in the museum field more livable.

There is an increasing trend in the American job landscape broadly towards reliance on temporary, and particularly contract, labor and the heritage field is no different, for many complicated reasons. Many heritage professionals, particularly early career professionals, more readily find employment on a contract basis these days. In our personal experiences the only paid positions readily available and accessible to early career professionals in our institutions are contract positions.

What exactly is a contractor?

Perhaps, if you’ve never worked on contract, you find yourself asking how working on contract with a heritage institution is any different than just…working at a heritage institution. You may be familiar with the idea that people hire contractors for things like construction work or something similar. In our case, when we say “contractor” we are referring to a very specific legal agreement between an individual (often called an independent contractor) and a heritage institution in which the institution agrees to pay x amount of money for very specific services rendered in a specific time-frame. This may look, for example, like an individual brought on under contract to process one archival or object collection over the course of one year for a lump sum of money paid out according to an agreed upon schedule. It may also look like a curatorial assistant who works on a contractual basis but has the opportunity to renew that contract on a yearly basis and gets paid along the same schedule that museum staff do. The form and flavor of contract often looks different across sub-discipline, department, and institution but the general gist is the same. They may also vary because some institutions first hire a contracting company (aka a company whose role it is to manage individual contractors) which then writes the actual contracts and handles payment and benefits.

While there are certainly some benefits to contracting (e.g. the ability to make your own schedule and set your own rates) there are also distinct drawbacks to this form of labor, commonly including lack of access to employer-provided healthcare, retirement benefits, and other resources most full-time, non-contract employees have access to. Overall, we have found that contracting can sometimes be a very confusing, frustrating, and isolating experience. Unless your institution proactively orients you to how their contracting process works, what your chain of command is as a contractor, and what recourse you have within the institution as a non-staff laborer you may have to struggle to find these answers in event of an issue (such as workplace harassment, delayed payment, contract disputes, etc.). In our cases this is not something that has ever been offered by our institutions.

Our perspective isn’t that contracting as an independent person with a heritage institution is inherently untenable or irresponsible–our position here at CoC is that the sooner the heritage sector directly acknowledges its growing reliance on contract labor, the sooner we can all join a dialogue on how to make contract labor more sustainable for both individuals and for heritage institutions.

Who is CoC?

Collections on Contract was started by two people who both began working on contract in the heritage sector right out of graduate school, which means that like most emerging museum professionals today we were coming off of a series of unpaid or low-paid internship experiences to network, boost our resumes, and “get our foot in the door”. Neither of us were ever formally, or informally for that matter, taught what it means to work on contract with a museum or archives and how that is different from being hired on as a staff-person. It isn’t something we were ever led to anticipate or expect. In fact, it is only as a result of contracting with institutions for a number of years now that we have been able to even begin to comprehend the technicalities, nuances, and legalities of being a contract worker in general, and in the heritage sector specifically. Between the two of us we’ve personally experienced: payments delayed for over a month on more than one occasion, professional retaliation resulting in lost wages and opportunities with no internal or external recourse, the government shutdown (a long story for another time), and a whole host of smaller and more nuanced issues that we’ll continue to talk about. Despite this, our perspective isn’t that contracting as an independent person with a heritage institution is inherently untenable or irresponsible–our position here at CoC is that the sooner the heritage sector directly acknowledges its growing reliance on contract labor, the sooner we can all join a dialogue on how to make contract labor more sustainable for both individuals and for heritage institutions. We’re also not just interested in discussing the difficult aspects of being an independent contractor, we would love to hear about and share tactics and resources that work for people, stories of achievement and joy, and to signal boost your accomplishments!

How can I get involved?

We’d like to try our best to amplify the conversation about contracting, because it is already happening, alongside parallel conversations in academia and similar fields. Through the creation of a collaborative community forum, we want to invite individual contractors from diverse areas of the heritage sector to share stories, experiences, advice, and resources to make contracting work in the museum field more livable. There are a few ways you can contribute:

Take our survey, located here! We’re very familiar with our little corner of the contracting world but would love to start building a bigger picture of heritage contracting around the U.S. (for now). The survey also allows us to learn how we can tailor this platform to best serve you. This survey is intended for everyone in the museum and heritage world, so even if you are not and have never been a contractor, we would still love to hear from you.
Contribute something to the blog: a personal narrative, a resource review, or advice request–see our submission guidelines here.
Follow along on here and on Twitter, we’re @ContractOn. Say hey and feel free to let us know how we can best serve your needs and if you have any questions.

We’ll be posting a discussion soon of the responses we’ve gotten to the survey, thus far, so if you’re curious check back soon. We’ve got some big ideas for what this platform could become and how it can serve this community, and we really appreciate your input!

Thank you!
The CoC team

Contracting 101 Webinar

We recently teamed up with the DC Emerging Museum Professionals community to provide a webinar on the basics of contracting. We are now happy to share the recording of the webinar with you, as well as a digital handout that we provided along with the webinar! A copy of the transcript of the webinar is also linked below, if you would prefer to access the information that way.

We are so glad we get to share this with you and hope you will find it helpful! If you have questions about this webinar or suggestions for topics for us to cover in the future, let us know!

The webinar transcript can be found here, and the digital resources handout can be found here.

We Were Already Expendable: Contract work and the COVID-19 Pandemic

By Leah Constantine

This is a moment of permanent transformation for cultural institutions. Those that remain will not return their operations to normal and many will be forced to make critical changes in their practices for the future. The likely future for cultural institutions will not only need to support the demands of a larger and more digitally literate audience but, more importantly, will foster a more progressive and just environment for what remains of its staff. The transformation within working environments will be critical if institutions hope to become sustainable and adaptable to the environments ahead. For contract workers, those environments were unsustainable and inequitable long before this crisis.

When institutions eventually make the transition to reopen, operations in-house will be minimized while the normal environments for engagement will become heavily digital and physical spaces within museums, libraries, and archives will be drastically reimagined to meet the needs for public health and safety of visitors and essential staff. Both national and international travel will take years for major cities to recover, and many museums will see this as the greatest impact in restructuring what used to be their normal operations. With new guidelines from the CDC being enforced for public spaces, museums will need to create the best redesign of its in-gallery spaces to reduce the physical capacity of staff and visitors for special exhibitions and education programs. Even when doors to museums and other cultural institutions reopen, they will always have the larger digital audience to continue supporting. During this time of transition, leadership will look to their remaining staff to support all new ideas and operations with fewer resources to fulfill them. Likely, most of the support that could have advanced these radical changes into real practice once existed in young or early career contracted employees, and the many institutions that have laid off those employees will soon realize they cannot make these changes without them. The radical organizers and the innovative thinkers that once existed in the museum were potentially the first groups eliminated, and institutions will have a hard time seeing any of them come back. What does this mean for the future of those institutions and the people who have left them?

The recent scrutiny and comprehensive documentation of massive disparities between laid-off employees and high-paid salaries for executive leaders make it clear that many institutions will be struggling to support what remains of their staff for years to come. A group of NYU graduate students and cultural workers are currently collecting the incomes of highest paid salaries in institutions and comparing them to the salaries of rank-and-file staff. The spreadsheet, “Indebted Cultural Workers: Calculate Your Salary,” has received salary data from 29 institutions, and data collection is still ongoing. Another spreadsheet creating waves in the museum world was made by Michelle Moon and the group Art + Museum Transparency. The spreadsheet was created in March and is documenting the impact of layoffs and furloughs as well as information about pay cuts and reduced hours of work in American museums during the pandemic. So far, 166 museums have been added to the list, and information about layoffs and furloughs is updated continuously. This comes a year after Kimberly Drew spoke at the AAM Keynote on her experience of receiving an inequitable salary in her role as Social Media Manager for The Met and later the massively widespread documentation of museum worker salaries created by Michelle Millar Fisher and colleagues at The Philadelphia Museum of Art. So many professionals enter the nonprofit world of museums, libraries, and archives being told to never expect to make enough money and to avoid discussing the struggles of low wages. Why is it okay that those same institutions create millionaires that live exclusively at the top and never have to worry about the impact of their wages? Documenting this injustice is at the heart of these movements and profoundly important to those that contribute to them.

While all employees of cultural institutions have been impacted by this crisis, contract workers are realizing their future is at more of a risk than ever before. There are many different types of contracts used for work in cultural institutions, but all have been greatly affected, emotionally, and professionally, during this crisis. It is difficult to determine what the future of contract work will be, but what is apparent is how it needs to change. This crisis has revealed the great challenges of relying on temporary staff for fundamental work. There is no sustainable future for institutions that continue to rely on radical ideas and progressive skills in temporary contracted employees. Those institutions that hope to return to their “normal” operations will suffer, and those who try to adapt without the skilled staff to support them will struggle. The Museum of Modern Art in New York City touts a mission statement founded on education as its core practice, yet took to firing all contract and freelance educators in this crisis. Some leadership roles in the same institution are still making salaries of over one million dollars a year. This is an injustice. If a museum cannot prioritize its mission statement by supporting opportunities for education and championing the workers in that field, then its leadership has failed. When the MoMA plans to reopen, how will it appeal to future educators when filling those vacancies to create a more progressive and accessible program? And, if it doesn’t restructure the education system, how will it change its mission statement to reflect these changes?

There may have been a time when budget restrictions and rapidly changing environments would have justified a contracted job for a temporary project. Today, most of these positions are created out of convenience for the institution. An institution that relies on freelance and contract positions to create and disseminate fundamental knowledge has no real priority for that practice. Too many contracted positions are created to fulfill temporary needs for ongoing projects that are typically geared towards early career and diversely skilled professionals. These professionals constantly struggle with maintaining the expectation of having to learn new skills and participate in multiple projects to feel prepared for the constantly changing work environment that is a result of all contract work. The unfavorable consequence of temporary contract work is that the employees are expected to fulfill accelerated expectations in an extremely limited time frame. The stressful and unstable environment is made more so by needing to prove one’s worth as essential while still seeking new opportunities when the contract comes to an end or a sudden change affects its terms. Today, we can see that the ongoing instability of using temporary contract work for an institution’s convenience has led to massive layoffs of those positions, deeming them expendable during a time of financial crisis. What this crisis could lead to in the future is a far more challenging effort for institutions to reopen physical spaces and support new and necessary projects. For institutions to prioritize a radical new future for their operations, they must first prioritize their staff who can make this future a reality.

I am currently employed through a temporary contract and am fortunate to know others in this same position who are willing to openly discuss the ongoing struggle of being considered expendable while our work is considered fundamental, even after we’re gone. I struggle, like many others, in trying to find the balance between creating the best work for my institution and my team while also knowing that the best work I can do may not mean anything once my contract has reached its term. A friend who is also on a temporary contract with his institution shared that his efforts just to validate his work are an additional stressor to an already stressful and uncertain job environment. In response to the overwhelming uncertainty of our work in contract positions, he shared, “The contract economy can skew a professional’s sense of their own value and their own potential because of the anxiety associated with meeting the expectations required to simply keep a job going from year to year. As a result, it can be challenging to see oneself in many job opportunities (faculty, tenure, etc.) which value more than just a healthy pace of statistics.” For him, this expanded effort in his work still does not create certainty that his temporary position would ever become permanent, and efforts to look for other job opportunities are thwarted due to the lack of having any mental bandwidth left to take on this additional responsibility. It is a stressful and toxic environment that has led to pressuring contract workers to accept minimal rewards for maximum efforts. The longer we stay in a contract, the more uncertain our future seems to be. When asked if this crisis could potentially lead to fewer temporary contracted jobs in the future, he responded honestly, “I have no evidence to believe that our generation will be awarded permanent positions if we do enough time on the contract circuit.” The time we have spent in this work will mean nothing if all rank-and-file jobs in cultural institutions are in jeopardy. What was uncertain before has become even more uncertain in our future.

A previous survey by Collections on Contract demonstrated the effects of contracting work for many of the young or early career professionals who fill these roles. Many of those who contributed have likely been furloughed or laid off in recent weeks with no promise of being rehired and little confidence in re-entering an already limited field. Institutions who have contributed to this devastating statistic have shown that the value of an employee can be directly reflected by their status in the institution as expendable. Losing all of these employees could be just as detrimental to an institution’s future as the current crisis has already proven. The crisis today has exposed many of the embedded inequalities that have existed in museums, libraries, and archives for decades. It should no longer be tolerable or sustainable to maintain massive salaries at the top while a majority of the most fundamental staff are kept at the bottom with restricted pay, temporary retainment, and expendable treatment. So many of these expendable employees could have been future leaders, and hopefully, some will still go on to fulfill those roles. But, for young professionals and contract employees, the first wave of firings will likely lead to more uncertainty for the future. Leaders of change are ready for this opportunity to reshape the way cultural institutions have always functioned. Many just have no idea if they will be able to return.

This is the time for reorganizing and reevaluating the way cultural institutions prioritize funds and create inequalities. It is up to all former and existing staff to hold current members of leadership accountable in creating a safer workplace for all employees to return to. Seeing how uncertain the future is for cultural institutions, it is likely that opportunities for permanent, non-contracted work will be extraordinarily sparse. This should not be an opportunity to continue normalizing the practice of hiring expendable staff in temporary contracts to fulfill fundamental needs for the institution. In our new normal, hiring practices and professional environments should become just as progressive and equitable as the physical environments that are being created for visitors.

Saving for Retirement as a Contractor– Yes, it’s possible!

One of the biggest downsides to being a contractor is the lack of benefits from your employer. In a lot of cases, contractors are working side-by-side with employees who are getting full benefits (retirement, health insurance, paid leave, etc.) while receiving none of the same consideration or compensation. While leave and health insurance can be trickier to figure out on your own, it’s actually fairly straightforward to start planning for retirement as a contractor or otherwise self-employed individual.

First of all though, why is it important? I’m sure we have probably all heard the spiel from well-meaning older generations about ‘investing in our future, taking care of ourselves as we grow older, getting a head start‘ and so on. But for someone who is living–as a lot of contractors in the heritage industry are–from paycheck to paycheck, it can sound pretty unreasonable to set aside 15% of your precious income into a financial system that you may or may not understand and cannot easily access. However, if you have a bit of money to spare after every few paychecks, it really will pay off to start setting aside some money early on- compounding interest really is the key to making enough to retire by a reasonable age. And it turns out, contractors have a bit of an edge over other employees when it comes to retirement savings.

While people who are employed by larger organizations have a 401(k) as their retirement account, self-employed individuals can open what’s called a SEP-IRA, or Self-Employed Individual Retirement Account. While this functions very similarly to a 401(k) in that you put money into the account to be invested in the stock market, there are a few key differences that individualize this type of account for contractors. Primarily, the difference lies in the fact that, because you don’t have an employer contributing to your account as you would with a 401(k), your threshold for how much you can contribute to your account per year is much higher. However, the real benefit comes through the fact that you have total control over how much money you put in to your account, on what schedule you contribute, and what you can invest in. While 401(k)s are usually set up to automatically deduct and invest a certain percentage of each paycheck, in a SEP-IRA you make all the contributions manually, by yourself. This means you have complete freedom to change the amount and frequency of your contributions; if you have a good month and can invest 10% of your paycheck then great, but you can also go months with contributing just 1% or even none. It’s all up to you and will be as flexible with your budget as you want it to be.

So, if this is all sounding good so far, how does one actually set up a SEP-IRA? It’s pretty straightforward. Simply find an investment company you want to work with (Fidelity, T. Rowe Price, Principal, etc.) and follow the steps to set up an account– this can usually be done online in a matter of minutes and most places don’t require an initial deposit of more than a hundred dollars or so (save up for the initial deposit if you need!).

From there, you can get into the second big benefit to having a SEP-IRA which is that you can choose what to invest in and how. If this sounds overwhelming (and it can be!) there’s actually a really simple solution: just like with a 401(k), you can put all of your money into a fund that has been specialized for the year you plan on retiring. It should be called something like, for instance, ‘2060 Fund’. In case you’re new to the stock market or retirement planning, basically a fund like this will automatically invest your money in a variety of stocks that will overtime become more conservative, meaning the closer you get to your retirement goal year, the less risky the fund will become. It’s a really simple, hands-off option identical to that of most 401(k)s! However, if you know a little about the market or want to make your own investment choices, the beauty of a SEP-IRA is that you can invest in anything you want! This is great if you are just starting out and/or trying to make up for lost time because you can choose to invest in something with more aggressive growth than your retirement year fund might provide, giving you the chance to earn more money over a shorter period of time.

If you’re totally new to the idea of retirement planning and need a quick recap, here it is: setting up a SEP-IRA is a relatively quick process, and once set up you can determine how much and how frequently you contribute to the account. Furthermore, you can control what and how you invest, making it easy to personalize your retirement fund based on your personal goals. Ultimately, as long as you have enough to make the minimum deposit required to open an account, there is no reason to not have a SEP-IRA and just contribute as much as you can, when you can. It’s the best of both worlds- you can make the system work with your ever-changing budget while still knowing you are making a difference for your future.

Workshop Recap: The Business of Being an Independent Museum Professional, from the American Alliance of Museums

We recently participated in a free, open-to-all webinar hosted by American Alliance of Museums (AAM) that focused on all the crucial legal aspects of running your own business that contractors (or as AAM terms it, independent museum professionals) should be aware of. Read on for our summaries of some key takeaways and answers to all your basic legal questions! We would like to thank AAM as well as legal professionals Ginny Cascio Bonifacino and Heather Hope Kuruvilla for taking the time to share their knowledge and insights with so many contractors.

** Much of this information varies from state to state, always check with your state and city/county governments for specifics**

Sole-Proprietorship vs LLC: What’s right for you?

This is something that is frequently discussed in contracting communities, but it was good to hear official explanations of the two business models from actual attorneys. The two business models are summarized below, but it is important to remember that no matter what type of organization you decide to form, both sole-proprietorships and LLCs are taxed the same.

Sole-Proprietorship: Owned and run by 1 person, who is not legally differentiated from the business. This means you, personally, are liable and responsible for business debts. Net income and loss are reported on your personal tax returns.

LLC: Owned and run by 1 person, but that person is legally separate from their business. This gives you a ‘corporate shield’ of protection against liabilities and debts. This method requires slightly more initial effort to get started, namely a Certificate of Organization and an Operating Agreement, as well as any other requirements required by your state.

Business Registration

Once you’ve decided what type of business model works best for you, you have to actually register your business! This can be a little confusing and varies from state to state, but here are are some helpful hints about navigating your business registration process

-Get an Employee Identification Number (EIN)- these 9 digit codes are issued by the IRS and are like a SSN for your business. If you are an LLC you need one of these, and if you are a Sole-Proprietorship then you can use your SSN but it’s really better to just get an EIN. They are free and you can request one online.

-You must register your business in every state that you have a ‘nexus’ in, which is defined as anywhere you have a physical office location OR multiple clients.

Example: If you’re registered in Virginia but you do one job for one client in Maryland, you don’t need to register your business in Maryland, but if you have multiple clients or recurring jobs in Maryland you would want to register in both Virginia and Maryland.

-Again, always check state and local regulations as a few states require you to file and pay sales taxes on your work.

-States can and sometimes will revoke your business’s registration if you do not pay your taxes! However, if you are late on/forgot your taxes, most states will just charge you a penalty that must be paid (along with your taxes) before you can resume business.

What to Include in Contracts

We found this run-down of standard terms and clauses super helpful, especially because we know many contractors are never formally taught how to write their own contracts! One of the biggest messages throughout this seminar that successful contracting depends of establishing enough independence for you to be able to protect yourself. Not all of the following things may need to be included in every one of your contracts, but think of this as a road map for the options you have when drafting a new agreement.

Terms: Always make sure you are being treated as a consultant, not an employee. Include terms in your contract to specify your expectations regarding:

The hours you’re expected to work (i.e. that you schedule time during your work week to take care of your own business needs– this is similar to what we heard from Kim Cullen-Cobb about administrative time, so check out that post for more details!)
What equipment you’re using and who is paying for it
If you will be supervised, by who, and what type of relationship they will have with you (i.e. will you have a supervisor and if so what will they be able to ask from you)
Your right to set your own rates
Who is responsible for all expenses incurred while working on this project

Clauses: Your contract should also include a number of clauses, explained briefly below.

Scope of Work: Essentially saying what you’re going to do, including deliverables, timing, etc. Be as specific as possible.

Standard of Services: Set reasonable professional standards for your work, based on whatever standards are present in your specific industry.

Payment Terms: How much you will be charging, when you will be invoicing, late fees, the right to terminate your contract if you aren’t paid within a reasonable time.
- They said you should always have late fees and charge interest, but you may eventually come across a client who will not sign a contract that includes late fees. In such a scenario, use your best judgment and do all you can to protect yourself against late payments and other issues.

Intellectual Property: State who owns what you create during the scope of the project. The general standard is that you own whatever you create (your deliverables) until you have formally turned them over to the client.

Risk Management: State who is responsible for damages, incidentals, etc. Also include indemnification, which generally states that each party is responsible for its own actions, or at least will be held accountable for gross negligence and misconduct.

Non-Solicitation: This clause should prevent the client from actively seeking to replace your contract with one from another business for the length of your contract.

Termination: Give yourself a way out for if you don’t like the project or if the client violates the terms of the contract

Dispute Resolution: Determine how any conflicts between yourself and the client will be settled (i.e. in what court or by what means of mediation)

Venue and Laws: Determine under which state’s laws you will be operating and negotiation.

Attorney’s Fees: Agree who will pay what legal fees in the event of a dispute. Standard is usually that the client will pay your legal fees if you win the settlement.

Insurance

Last but not least, we covered what is possibly the most complicated and headache-inducing part of contracting; insurance. Bonifacino and Kuruvilla emphasized that insurance needs differ with each individual and contract, but laid out some basic types of insurance that an independent professional might want to consider.

Types of insurance to consider are:

General liability (required)
Errors and omissions (advised)
Cyber liability (depending on your project)
Workers comp (if you employ anyone else at your business)
Auto (if driving is part of your job)

Insurance tip: Try to limit your liability to direct damage caused by you and/or to a specific dollar amount. A good recommendation is to limit it so that you are only responsible for damages that cost up to half of your total compensation for a contract.

Well, there you have it; a quick but thorough run-down of all the legal situations and implications that contractors should be aware of as they do business. We know that this only scratches the surface of some of these scenarios, and we encourage you to reach out to us here at CoC, or to AAM, with any questions you may have!

To All the Interns I’ve Loved Before

The following letter, written by a federal contractor working in a collections management department who chooses to remain anonymous, represents the typical advice they offer to enterprising interns seeking career advice. What follows represent the views and experiences of one person, the decision to include this on the CoC blog comes from a desire to represent a broad range of opinions, experiences, backgrounds, and information. We always invite responses, including those with differing or supplementary viewpoints.

-CoC Team

Dear Past, Present, and Future Interns,

In response to the age-old questions: What does it take to work in the museum field? How do I get my start? How does contracting play into this?

First, most jobs at museums will require at least a master’s degree, though some smaller museums may not require as much education. Most of the staff that you’ve met (or will meet) during your internship, for example, probably have a master’s or PhD degree and contractors are working jobs that many in the museum collections field consider “entry-level”. You’ve gained a lot of great hands-on experience during internships (and will probably learn the most useful skills during this time), but museum work also requires a background understanding of theory and ethics of that you’ll lack without either getting a graduate certificate or Master of Arts in Museum Studies or a related field. While the certificates are often the easier route for both time (you can often get one in about a year) and money, I’ve found that some of my friends and previous colleagues who went for certificates didn’t find that it actually helped them score a job once they completed the certificate. As prohibitive master’s degrees can be in terms of time and cost, it’s often the baseline requirement for jobs in a museum. There are dozens of great programs around the country and abroad, and so many museum professionals are happy to try to help you find the right one. Personally, I would initially caution you against online programs, though, because the most useful part of going to grad school is to build your professional network via in-person interactions, and getting museum jobs is often based in who you know and where you’ve worked.

However, I will warn you that the museum field is insanely competitive and it is very, very difficult to find a job, even with a master’s degree. Because so many great people are going to school to get degrees in Museum Studies or a related field, the job market is oversaturated with too many highly qualified candidates. Often, the stars have to align where you’re in the right place at the right time to actually find a job that you are specialized to do. For example, I just happened to intern at the right time and another contractor left because they were tired of waiting to hear if the project would be funded or not, so I was offered a contract position only because someone happened to leave. While contracting jobs are often right place/right time situations, there is absolutely no guarantee of another contract once you finish with one. We are often told by our institution to keep looking for jobs elsewhere because they cannot guarantee the funding to keep us around. I would also caution you to really consider how much time you are willing to spend taking unpaid internships and how much money you are willing to spend on more education. Many must work for at least 2-3 years unpaid or for very little pay in addition to spending upwards of $100k on master’s degrees to even be considered for entry-level jobs that only pay 35k-45k. Although job postings say that an undergrad degree is enough of a qualification, many of the eventual appointees have master’s degrees and numerous years of experience in the field. It can be a really tough road, and I’ve seen a number of colleagues leave the field because they could no longer handle the instability and low pay that comes along with museum work. However, if you find that you’re passionate about it, you might find yourself in one of those situations where the stars align just right. It could take upwards of five years to a decade, though, to finally be in a stable position.

If you’re hoping to get more experience and want to hold off on committing to a master’s degree or certificate program for now, you have a couple of options. First are entry-level visitor services jobs. They will hire people with undergrad degrees and are a good way to see both how different museums work and to help grow your network. Museums are always looking for visitor services staff, and these jobs can sometimes be full-time with benefits. However, these jobs will often not lead to much beyond the visitor services department, which is in charge of tasks such as selling tickets, answering phones, and staffing exhibits. Another way to gain some experience is to find a paying job outside of the field and volunteer or intern a few hours a week on the side. I did a combination of a visitor services job and interning/volunteering in-between undergrad and grad school, and it did provide me with some really great experience before I started grad school. However, it was a very busy/stressful time where I had little time for myself, my friends, and my family.

I in no way want to scare you away from the museum field, but I want you to know what you’re potentially getting into. It can be insanely rewarding work, and I’ve been very lucky to have so many opportunities to get to where I’m at, but I always want to caution people entering field about everything that you might have to realistically sacrifice to do this . While no one’s experience is universal, you might find yourself in at least one of these situations within a museum, especially contracting.

Best,

Your Loving Internship Mentor

Making Contracting Work For You, with Kim Cullen-Cobb

by: The CoC Team

We recently had the privilege of sitting down with Kim Cullen Cobb, the current contract conservator for the Smithsonian Institution’s Department of Anthropology Collections, to talk about her experiences as a career contractor.

Conservation is Kim’s second career–before she found her current passion, she had a long and successful career as a metalsmith making one-of-a-kind jewelry. Over time she realized that the work she was doing no longer fulfilled her as it once had, so she decided to go back to school for something she had long been interested in: archaeological and ethnographic conservation. She learned quickly that, due to an over-saturated field and a lack of full-time, well-paying gigs, contracts are the name of the game. Kim explained that she has had an overall positive experience working as a contract conservator, so we asked her to share some of her top tips for getting the most out of a contract.

Think of yourself as a business from day one

Those of you who have contracted with the federal government may have become aware of your technical status as a ‘sole proprietorship’, aka an independent business, from the very beginning of the process. Mechanisms like the federal System for Award Management (SAM), the central federal database of vendors in which all contractors are required to register, makes that status very clear through questions about the demographic makeup of your employees, whether or not you import and export goods, and the option to mark yourself as a woman or minority owned small business. When you’re registering in SAM as a single, independent contractor these questions can all seem like a weird formality and information that doesn’t really pertain to you. While this is true for much of the information that SAM is designed to capture, taking that registration process seriously can help you to get into the mindset of owning and operating your own business–even if that business is literally just you. Kim advises every new contractor, even those who are not going through the federal award system, to do their best to operate under this mindset.

To paraphrase Kim, when you start treating yourself as a business and the services you provide as a product it allows you a degree of separation which can make it easier for you to both value and evaluate your labor. It also, in our experiences as well, simplifies sometimes messy inter-personal relationships with employers and HR departments. Advocating for yourself as a professional with the education, skills, and experience needed to accomplish the tasks put forth in a request for quote can sometimes be intimidating (albeit always important). Advocating for your business on the other hand, an entity that is performing a job for an agreed upon fee, removes the impulse or seeming need to justify one’s worth as a person. Given that many contracts, especially short-term ones, are established as a fee for service or an agreement that you will be paid a set amount of money for completing a list of predetermined deliverables, it is important that you become comfortable situating your labor within the market landscape of your field.

A specific piece of advice Kim has regarding operating as a business: When it comes to taxes, you should become familiar with the tax deductions available to sole proprietors, LLC’s or S Corporations, depending on how you have set up your business. Check with your tax accountant (if you’ve got one) or pool resources with your colleagues and bring in an accountant who can advise you on some of these finer tax details. We’ll be doing a longer, more in-depth look at doing your taxes as an independent contractor, but for now we’ll emphasize that as soon as you sign that first contract start tracking your expenses and income carefully. If it isn’t in your normal routine to ask for and keep receipts, look into an expense tracking software or app that can help you flag business-related expenses!

Think of your quote wholistically

When responding to a request for quote (RFQ), think your way through all the steps involved in the scope of work to capture all the mundane tasks involved. Some of these fall outside the broadly stated scope of work; Kim explained that this includes all of the time she expects to spend working that isn’t directly resulting in a deliverable, such as reading and responding to emails, scheduling and attending meetings, planning for and organizing her project, and preparing invoices. This varies with each contract so don’t be too hard on yourself if you fail to capture every detail, some of this just comes with time and experience.

If this is not something you feel you can do (i.e. increase your rate of pay to include these fees), make it clear that some of you billable hours will necessarily be delegated to these administrative tasks which impact the overall timeline for a project. While it may seem obvious that any job regardless of contract length will require some degree of housekeeping work, it is not uncommon for a Call For Proposals or Request for Quotes, or even the language of the contract itself, to not explicitly include mention of that labor. The time you spend following up on emails is just as important and valuable as time spent working on your project deliverables and should be treated as such from the very beginning of the contracting process.

Be flexible and use ALL of your resources

In a lot of ways, Kim says, having the opportunity to work on many different kinds of projects and with lots of institutions is a contractor’s biggest asset. Being able to spend 3 months doing one thing and the next 3 months doing something completely different, and so on, allows you to gain many different skill sets often across different departments or museums. This is a big asset to your resume going forward! The big key to landing diverse contracts, according to Kim? Use everything you’ve got. Any skill set you’ve acquired, regardless if it strictly pertains to your field of work, is an asset and should be in your mental reservoir of experiences to draw on. Worked in a clerical position in grad school? Great, you’ve got data entry skills! Again, remember that you are a business and above all what you are selling is YOU, so make the most of every bit of experience you have.

Network, network, network!

It will come as no surprise to those of you who are old-hands at contracting, but a lot of times the single best thing you can do to help your career is to network with anyone and everyone. Regardless of whether your next opportunity is a sole-source situation or if there’s a call for quotes, word of mouth goes a long way in influencing what opportunities you have access to. One way Kim stays tapped into a professional network is through involvement in professional societies. Not only is she a member of various professional museum and conservation societies, she encourages participation in committees and boards for those societies. This sort of extra-curricular work, often on a volunteer basis, has allowed Kim to establish herself in her field and be in regular touch with other professionals from all across her discipline.

Kim has let us know that while there are some definite potential drawbacks to contracting, especially basing your livelihood on it, she feels empowered as a contractor and generally feels very happy with where she’s at in her career because of it. We feel her advice could be boiled down into these two nuggets: be proactive, and don’t be afraid to be assertive! Thanks Kim!