Is there a legal difference between being "freelance" and being "self-employed"??
Thread poster: Rebecca Holmes

Rebecca Holmes
United States
Local time: 20:25
German to English
Aug 15, 2005

Legally speaking, is there a difference between being "freelance" and being "self-employed"? In a text I am working on, an engineer who performs the calculations and operates the machinery in a clinic for laser eye surgery is referred to as being a freelancer/self-employed ("freischaffender Mitarbeiter").
The German term was not one I was very familiar so I suggested both options to the customer. Now, of course, they want to know what the difference is in terms of labor/employment law. AGGH! What IS the difference? Is there one at all?


Sarah Downing  Identity Verified
Local time: 20:25
German to English
+ ...
Selbständig/Freischaffend v. Freiberuflich Aug 15, 2005

Hi Becky,

In German law there is a group of jobs which are known as the "freie Berufe" - translator/interpreter is one of them. The advantage of your job being in this group is that you don't have to pay Gewerbesteuer (trade tax), whereas people who are self-employed do, but that's about all I know on the subject, I'm afraid (hopefully someone more knowledgeable like Ralf or Rod will post a reply ...:-))

Take care and good luck!


[Edited at 2005-08-15 14:35]


Samuel Murray  Identity Verified
Local time: 02:25
Member (2006)
English to Afrikaans
+ ...
It depends on your country, but... Aug 15, 2005

Rebecca Holmes-Löffler wrote:
Legally speaking, is there a difference between being "freelance" and being "self-employed"?

It would depend the country, and I don't know what the situation in Germany is, but I have always supposed that "freelancer" means anyone who is not employed by a company.

If you are "self-employed", it could mean that you had registered your own company that that you are an employee (the only employee) at your own company. This has some tax and legal advantages in some countries, but perhaps not in all countries.

For example, if I as a freelancer makes a mistake, then I'm personally liable, but if I'm self-employed (employed by a company, even if I'm also the owner of that company), then the company is liable. Also, as a freelancer I may not qualify for various tax breaks offered to companies, but if I register a company, then I might qualify. But this differs from country to country, I think.


RobinB  Identity Verified
United States
Local time: 19:25
German to English
Freiberufler v. freier Mitarbeiter Aug 15, 2005

As Sarah essentially points out, the difference in Germany at least is one of tax law. Most self-employed people are not Freiberufler (only those professions listed in the EStG as amended by various court rulings are classified as Freiberufler).

The distinction in Germany is thus much tighter than in other countries.

A "frei(schaffend)er Mitarbeiter" is any self-employed person or "independent contractor" irrespective of whether they're classified as Freiberufler or not.

I really think it's up to your client to establish what category that particular person falls into, and I don't think that sort of legal research is the province of the translator.

I *would* restrict use of the term "freelance" to Freiberufler, though.

Neither would I interpret "self-employed" as meaning that the person has necessarily established a registered company, as being employed by your own company isn't the same as being self-employed. In most European countries at least, being self-employed means that you're registered (normally with the tax authorities at least) as a sole (unincorporated) trader.


[Edited at 2005-08-15 12:42]

[Edited at 2005-08-15 12:45]


Charlie Bavington (X)  Identity Verified
Local time: 01:25
French to English
If this helps... Aug 15, 2005

From a UK perspective:

"Self-employed" is the status by which you are NOT employed by a company at all. This includes NOT being employed by a company that consists solely of yourself (notwithstanding the fact that you need 2 people minimum to form a company in the UK anyway, one of whom may not take an active role). If you have set up such a company, then you are not self-employed. Self-employment is simpler administratively, but does mean you have unlimited liability, your personal assets could be used to discharge debts incurred in the course of your business, etc.

"Freelance", AFAIK, doesn't have any specific legal/tax definition. It just means you are willing to work (in the general sense, not "be employed by") for anyone. I have heard the term used to apply to both the self-employed (as defined above) and to those who have established themselves as "one-man companies".

I don't know if this helps for your situation as regards Germany. I do know that a similar distinction operates in France, where if you wish to go freelance (as per my description above), you have a similar choice between self-employment and setting up a one-man company (EURL). Other countries may not offer this choice, I guess.

(Later) - and yes, as those below have pointed out, there's nothing (in the UK) to stop an employee doing freelance work.
So to sum up perhaps:
All self-employed people are freelancers, but not all freelancers are necessarily self-employed...

[Edited at 2005-08-16 11:57]


Benno Groeneveld  Identity Verified
United States
Local time: 20:25
English to Dutch
+ ...
In the US, fully employed people Aug 15, 2005

sometimes (often) freelance. For example, a staff writer at a magazine or newspaper, can (and does) write articles for other publications. Those other articles are done on a "freelance" basis, meaning the writer gets some (often little, depending on a number of factors, including how famous he/she is) money for his/her work.

Self-employed means you employ yourself (usually a good boss to have!) and you have to pay your taxes, social security, etc. yourself.

A freelance who has a fulltime job, also has to pay taxes on the freelance income.

As far as I know, having been a self-employed freelancer for many years.

[Edited at 2005-08-15 14:14]


Anjo Sterringa  Identity Verified
Local time: 02:25
Member (2003)
English to Dutch
+ ...
Agree, an employee can do freelance work Aug 15, 2005

I do agree - one way of distinguishing between self-employed and freelance is that a self-employed person 'does not have a boss' and a freelancer may be an employee who is 'freelancing' in the evenings. This is possible in the Netherlands for instance. You then pay tax on your freelance income as earnings from 'other work'. You can be self-employed in a "liberal profession" , such as lawyer, translator in some countries (e.g. Spain)etc. which may have consequences for payment of taxes and other regulations or as a sole trader or well, anything really. Whether it would include having a limited company probably depends on the country the text is read in. Perhaps that is why the term 'entrepreneur' is so widely used in European texts.
In this English text from the Goethe Institut about Germany freelance and self-employed are used indistinctively....
"Liberal Professions in Germany: Between Deregulation and Me, Inc.
They represent just 2.15 per cent of Germany's working population of 38 million. Yet together with 2.7 million employees of their own, these 815,000 freelancers generate around nine per cent of German GDP. In addition, they offer the most apprenticeship places after the industry, retail and craft sectors.
The members of the so-called liberal professions are self-employed physicians, lawyers, architects and artists. According to the Association for Liberal Professions in Bavaria, they 'safeguard, for the benefit of the individual, existential basic values such as health, justice, property and cultural diversity'."

[Edited at 2005-08-15 22:23]


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