Sheila McClear Takes Credit For Gawker’s W-2 Offer

jousting knight freelance
a free lance. flickr: Jeff Kubina

Sheila McClear on the news that Gawker Media is offering its writers the chance to become full-time: “Hahaha. I’m going to go ahead and take some credit here for calling his ass out. Jesus fucking Christ Denton, I bet the IRS got real interested in your book-cooking and shoddy-ass legal counsel.”

As we reported yesterday, Gawker Media is offering its employees a choice: become a full-time employee or reduce your workweek to four days out of five.

There had been some theorizing that Gawker alum Sheila McClear’s unemployment case, when she applied for—and eventually received!—unemployment benefits after being laid off in December 2008, was the impetus behind the move at Gawker media.

Companies misclassifying their workers as freelancers aren’t often happy when one freelancer applies for unemployment; “If a nonsalaried employee applies for benefits and is found eligible, his employer is susceptible to an audit by the Department of Labor, and could end up owing back taxes for unpaid unemployment insurance,” wrote McClear herself in an article about the issue in the NY Post. So it’s possible that the DOL, prompted by their decision to award unemployment benefits to McClear, then began investigating (or threatening to investigate) the rest of Gawker Media’s operations.

The other piece to the story is the news that writers who don’t take full-time employment with Gawker will see their workweek reduced from five to four. We originally thought that maybe there was a law at the New York State Department of Labor saying that only freelancers who put in a full week’s worth of work would be eligible for unemployment benefits if they were found to have been misclassified, meaning that any four-day-a-week permalancers at Gawker would not be eligible for unemployment.

That turns out not to be true, according to a spokesperson for the NYSDOL. However, writers who are slapped with what amounts to a 20% pay cut will invariably need to pick up the slack elsewhere, with other clients or outlets. Update: Nick Denton emailed to tell us that writers who don’t opt to become employees won’t see their base pay cut by 20%. That’s jolly good of him, we say.

One of the criteria used by departments of labor to determine a worker’s status is how many clients the so-called “independent contractor” has. Only one client: probably a misclassified employee. Two clients: probably a contractor.

Having two clients makes you look a heck of a lot more independent than having just one. So that’s Denton’s strategy.

The question, which he still hasn’t answered, is what benefits, if any, the full-timers will receive.

Update: Full-timers, meanwhile, will receive 3 weeks paid vacation and a company-paid health insurance plan.

More: Audits Coming: Watch out, misclassified 1099s
Sheila McClear’s Memoir (It’s Not About Gawker)