South Africa’s freelance market is quietly and quickly growing, driven by remote work and the search for economic flexibility. The most prevalent issue the market has is the significant number of freelancers earning under R10 000 per month due to low rates and inconsistent client payments.
On a positive note, the freelancer gender pay gap in South Africa is one of the lowest in the world. According to a report by Remitly for Freelancers, South Africa records an overall freelancer gender pay gap of just 3,9% – the second-smallest gap among all countries analysed, behind only Croatia.
The report analysed the freelancer gender pay gap by retrieving freelancer rates across the globe on upwork.com and used gender-api.com to assess the likely gender associated with each freelancer name.
The report also shed light on various elements of South Africa’s freelancer economy. Key findings include:
- Women freelancers charge an average of $34,26/hour, compared to $35,64/hour for men
- South Africa ranks second globally for freelancer pay equality
- South Africa’s Freelancer Equal Pay Day falls on January 15, meaning women effectively work 14 additional days “for free” into the year compared to men
South African Freelancer Roles in Which Women Charge Less than Men
While the overall gap is small, individual freelance roles highlight wider disparities. When it comes to specific roles, women charge less than men in the following:
- Artificial intelligence (AI) services freelancers face the largest gap, with women charging 35,1% less than men on average.
- Customer service representatives charge 29,8% less
- Women in data engineering charge 18,4% less
- Women project managers charge 16,1% less
In comparison, the following roles show where women are charging more than men:
- 62,1% more than men in business consultation roles
- Management consultants charge 55,6% more
- Female e-mail marketing consultants charge 52,0% more than men
- Women taking on marketing consultant roles as freelancers charge 45,1% more than men
Challenges of South Africa’s Gig Economy
Much like other sectors, the freelance/gig economy sector has its own challenges. These include:
Lack of Social Protection Provisions
Unlike traditional employees, gig workers do not have access to social protection mechanisms such as unemployment insurance, pension contributions, paid leave, or compensation for workplace injuries.
Their income is highly unpredictable, with freelance workers dependent on demand and client payment. Additionally, gig workers are excluded from employer-sponsored benefits such as training, retirement funding, and travel allowances. This leaves them vulnerable to financial instability and without recourse when illness or injury occurs.
Lack of Labour Legislation and Additional Legal Protections
Labour regulations such as the Basic Conditions of Employment Act (BCEA), the Labour Relations Act (LRA), and the Employment Equity Act (EEA) are not applicable to gig workers because they are legally classified as independent contractors. As such, gig workers do not enjoy protections relating to minimum wages, regulated working hours, leave entitlements, or unfair dismissal protections.
Additionally, independent contractors cannot claim access to collective bargaining frameworks or unionisation rights.
Payment Defaults by Clients and Customers
Gig workers are often paid on completion of services, which exposes them to risks of non-payment. Since they cannot rely on legal labour mechanisms such as the BCEA to enforce claims, their remedies are limited to contractual avenues such as specific performance, damages claims, or cancellation of agreements.
Opportunities in South Africa’s Gig Economy
Despite facing heavy challenges, independent contractors have access to opportunities for innovation in labour regulation, economic growth and worker empowerment.
The Role of the Codes of Good Practice
The Fairwork Code of Good Practice for the Regulation of Platform Work in South Africa (2020) sets out five principles of decent work: fair pay, fair conditions, fair contracts, fair management, and fair association. While not a binding law, the Code is a useful reference for policymakers, legal practitioners, and platforms seeking to improve protections for gig workers.
Other legislative interventions that could benefit freelancers include:
- Recognising gig workers in labour legislation by extending statutory rights to this category of worker.
- Imposing minimum wage thresholds to provide basic income security.
- Encouraging collective bargaining and unionisation among gig workers to ensure adequate representation and protection.
How to Set Freelance Rates that Help you Grow
Setting freelance rates that help you grow without pricing out potential clients is a fine balance. Here are some ways you can find, calculate and maintain your freelance rates.
1. Find Your Base Rate
Your base rate is the minimum rate you need to cover essential costs. Calculate your monthly business and personal expenses, divide this figure by the number of monthly billable hours you can work, and that is your base rate.
2. Take Time Off
Working at your base rate may work as you build a client base, but you’ll need to factor in higher rates to start building a cushion for vacation or sick leave.
3. Assess Your Competition
You need to study the freelance platforms and join forums to get a clear idea of what people are charging. Once you have done your research, you must adjust your figures to account for your experience levels and local cost of living.
4. Be Careful With Your International Rates
Working internationally as a freelancer broadens your client base but also comes with extra costs, including currency conversion rates and transfer fees. You need to factor this in when quoting for international clients and be clear who will pay fees where relevant.
5. Be Transparent With Clients
You must be clear on the nature and extent of the work you will do for the stated fee. Consider whether you need to charge more for assignments where there is a tight deadline or where there are likely to be multiple rounds of revision.
6. Don’t Undersell Yourself
Consider your experience, achievements and qualifications when setting freelancer rates, and share them in your marketing. Also, gather testimonials from previous clients to back up your personal statement.
7. Know Your Parameters
There might be conditions in which you want to offer a lower or higher rate. You will be in a stronger negotiating position if you know your limits and can express your value with confidence.
8. Find the Right Payment Tool
You need to find the right payment tool for you. This tool should be secure, easily accessible and work for cross-border payment.
South Africa’s freelance market is quietly and quickly growing, driven by remote work and the search for economic flexibility. The most prevalent issue the market… Read More
