SMart is a solidarity economy organisation dedicated to an innovative, practical and sustainable improvement of the working conditions for artists and creatives. The organisation takes care of the administrative work for creatives and supports the professionalisation of art and cultural work with a selection of custom services. Sabine Kock and Lisa Pointner were interviewed by Michael Ternai.
The idea that SMart is based on originally comes from Belgium, right?
Sabine Kock: Yes. SMart was founded in 1998 by Julek Jurowicz and Pierre Burnotte in Brussels – at first really small, a garage startup (SMart stands for societé mutuelle des artists). But it grew quickly. After a law was passed in Belgium in 2002 that required all artistic work to be done by employees, SMart began to grow even faster. In the meantime there are more than 60,000 SMart user in Belgium, 170 employees and a yearly transaction volume of over 100 million Euro. The range and breadth of services provided by SMart have begun to have a systemic effect in Belgium – many artistic jobs that used to take place under the table – street performance, merchandise sales – have been made official through employment with SMart which makes them relevant income for social services.
How is SMart financed?
Sabine Kock: Right now we are Lucky that we receive start-up financing from Brussels. But it is clear that our goals are to be self-sufficient through the services we offer. Our main service is called SMartProduction. We ask for a service fee of 7.5% of the amount generated. We think that this is an amount that our artists and creatives can afford, and that – if we continue to grow – should make us del-sufficient soon.
The second service that we offer is called SMartAdmin. In this area we offer artists and non-profit associations book-keeping or end of year project based receipt organisation. This is a purely administrative service, and we charge differently for that. 30 Euro per work hour.
What exactly does SMart do? What do you offer? How could you summarise your field of activity?
Sabine Kock: Our slogan is: “You do the art, we will do the paperwork.” SMart offers to take over the frequently painstaking bureaucratic procedures. One of our primary goals is to provide a structure of solidarity for all of those who had previously worked alone. This is the reason we formed a Solidarity Economy Cooperative last year.For us it was about the professionalisation and improvement of working conditions as well as participation in social security. The work of SMart begins where the work of the interest groups (who are mostly consulting) ends. We get into the contracts, in the case of employment we take over the responsibilities of the employer, in any case guarantees of payment and financial risks, and support the artists.
How and in what form can one work with SMart?
Lisa Pointner: There are basically two possibilities to work with SMart. The first is in the form of an employment contract. In this case SMart takes on the role and responsibilities of the employer and employs the artist as part of the cooperative in order to fulfil the contract – for example a concert. The second possibility is to work independently as a sub-contractor for SMart. In this case Smart takes on the role of the general contractor. It is practically the same as an employment, but in this case the artists receives a fee rather than a wage.
How does SMart work?
Sabine Kock: I can explain it with an example. A director comes to us who received an offer to do a theater workshop at a museum. Normally she would make a contract with the museum. Instead, she comes to us and we enter into the contract with the museum and take over the administrative work. Now she can say the she wants to be self-employed, in which case 7.5% of the amount of the contract goes to SMart. She can also say that, for this workshop or also for others she does this month, she would like to be employed with us. In that case, we are payed the money from the contract. We subtract our fees and use the remaining budget to generate the employment.
Practically, that means that in an employment situation with SMart the artist receives roughly 50% of the money generated as take-home-pay, but for this time is an employee who is relevant for the social security system and the time is counted toward unemployment insurance.
That means you function as a normal employer?
Sabine Kock: Yes, we are the employer with all of their rights and responsibilities. But this creates a new, self-determined form of employment. Because, in principal, the people independently choose their tasks themselves. They are our employees, and yet they are still completely autonomous.
In this sense, SMart is sort of a counter-movement to the global trend of taking people out of secure employment and forcing them into self-employment. Many employees were forced into self-employment in which they have to work day in and day out, frequently with out any kind of social insurance in case of sickness, not to even think of the luxury of paid vacation. Not just in the arts, but also in culture work. We live in a time in which the erosion of continuous employment affects ever broader areas of the labor market. In Austria as well as globally. SMart tries to counter this, and create a structure under which a form of social- and labor-law inclusion can once again take place, and people can reduce their risk and enjoy stability again.
Lisa Pointner: As employer or general contractor we have to pay our employees and sub-contractors wether we are paid by client or not. This is a risk we are pleased to take on for our artists.
Sabine Kock: Luckily that hasn’t been a fundamental problem, we haven’t had anyone default on us. But what can happen are time differences. It can sometimes happen that someone is employed for us for a certain time for a project but the client doesn’t settle the bill under later. But in this situation the contractor is employed with us and paid during that time. I think those are the types of things that provide stability. If it ever does happen that a client doesn’t pay, we will send out a reminder. And if the worst case happens and someone doesn’t pay at all then we take on the liability. On top of all of that we also provide consulting and support. As a backup we also have connections to a good tax advisor and lawyer.
Who can work with SMart? Are there any groups you can’t support? Where do you draw the line?
Lisa Pointner: Of course any artists, cultural workers, and creatives can come to us. Right now we draw the line at trade licenses. Those who need a license to do their job can’t be supported by us because we would need to have the same license. A trade license has a lot of legal consequences. We have an idea how we can approach this, but the project is costly and only good for everyone involved if there is enough demand. But it isn’t completely off the table.
Who comes to SMart and what are their motives?
Lisa Pointner: One could say that people from across the board come to us. There is no single area that is represented more than any other. In Austria the incidental wage costs are relatively high. Especially since they are carried by the employer as well as the employee. That means that here almost 50% of the income goes toward these costs.
That was also why we originally thought that it could be very difficult in Austria and very few people would want to be employed. But it was just the opposite. Many people wanted employment. And they wanted it for a variety of reasons. Part of the reasons are complicated foreign transactions. If any one works on projects abroad they pay into a social system money that they will never get back. But we can employ these people in Austria and send them to that country. So they pay into the Austrian system and are regularly employed here.
Sabine Kock: That is the complex situation that comes along with internationality. And it is true that these situations are common. But in general we can recognise three groups. There are those who don’t want to pay into the SVA (self-employed social insurance group) and want to be employed. They want to have or have more social inclusion and frequently want to avoid paying into multiple insurances. They want access to unemployment insurance or need an employment for residency reasons. This group includes those who have mixed income. Many musicians for example also teach at music schools and also have a band. They have to consider wether the should be self-employed and paying into the SVA with the options of subsidies from the artists social insurance fund, or try to keep their freelance income under the mandatory insurance limit in order to avoid that.
Then there are those who can, with various projects and contracts, manage to generate a monthly sum. That could be 500 Euro per month or 1000. Enough to be able to bring in enough for SMart and a continuing employment. All of their contracts together allow for continual employment with us.
So far there have been fewer who chose at the beginning of their career to be independent, pay into SVA, get a tax number, deal with value added tax, and as a part of the professionalisation choose to have us take care of their administrative work.
Lisa Pointner: In a case like that working with SMart is particulary useful for artists that aren’t required to add VAT, but work with organisers who do. As a business we fall under that requirement and the artists can their pre-tax and operating expenses back. That means, they get back 20%, although they themselves don’t have to charge the VAT. If their operating expenses are at least one third of their generated income the return amortises our service fee. If their costs are higher, our users can even get money back while still enjoying our services although they didn’t really have to spend any money. In a situation like that working with SMart provides a double dividend.
Michael Ternai (adapted from the German by Dave Dempsey)