Principle
Iguality is committed to Equal Pay for Equal Value across all roles and contract types, including freelancers, employees, or others. Compensation reflects the true value of the work and is applied fairly and consistently, regardless of contract type or individual tax situation.
Target Net Pay
To ensure a decent living standard, Iguality aims for a similar net pay for all freelance roles. Actual base rates vary depending on individual taxes, generally ranging between €22 and €30 per hour. Differences in base rates do not reflect differences in work value; they are simply mathematical adjustments to meet the target net pay after IRPF and IVA.
Bucket-Based Adjustment System
To ensure proportionality and financial sustainability, weekly hours determine a bucket multiplier applied to the base cost. The buckets are:
- Bucket 1: 0–15 weekly hours – 100% of the rate applied
- Bucket 2: 16–25 weekly hours – 90% of the rate applied
- Bucket 3: 26–35 weekly hours – 80% of the rate applied
- Bucket 4: 36–40 weekly hours – 70% of the rate applied
Worked Example
A freelancer with a base rate of €26.74/hour illustrates the impact of hours and the bucket system:
- 10 weekly hours: Bucket 1 (100%) → estimated yearly net pay €11,819, monthly net pay €985, net hourly pay €22.73
- 15 weekly hours: Bucket 2 (90%) → estimated yearly net pay €15,957, monthly net pay €1,330, net hourly pay €20.36
- 25 weekly hours: Bucket 3 (80%) → estimated yearly net pay €23,638, monthly net pay €1,970, net hourly pay €18.24
- 35 weekly hours: Bucket 4 (70%) → estimated yearly net pay €28,957, monthly net pay €2,413, net hourly pay €15.91
Extra or Missing Hours
For freelancers with a fixed monthly invoice, extra or missing hours are handled as follows:
Extra Hours on Top of Base Hours:
- Calculate the base hourly rate by dividing the normal monthly invoice by the total monthly hours (base weekly hours × 4.33, the average number of weeks per month).
- Multiply this base hourly rate by the extra hours worked.
- IVA and IRPF are applied as usual.
- Example: A freelancer with a monthly invoice of €930 for 10 hours/week has a base hourly rate calculated as 930 ÷ (10 × 4.33) ≈ €21.48/hour. If they work 5 extra hours in a week, extra pay = 21.48 × 5 ≈ €107.40. Total monthly payment = €930 + €107.40 ≈ €1,037.40.
Separate Hours Submitted Independently:
- If hours are invoiced separately from the base monthly contract (e.g., covering missing hours or a short-term assignment), treat the hours as a full week for the purpose of the bucket system.
- Determine the appropriate bucket multiplier based on the number of hours being submitted.
- Multiply the base hourly rate by the number of hours and the bucket multiplier, then apply IVA and IRPF.
- Example: A freelancer submits 25 separate hours. Base rate €29.41. Using the bucket system: 25 hours → Bucket 2 (90%). Payment = 29.41 × 25 × 0.9 ≈ €661.73.
Key Principles
- Equal value, equal net pay for equivalent roles
- Bucket system ensures sustainability for higher-hour workloads
- IVA is included only for organizational budgeting
- IRPF is applied only for freelancer take-home pay
- Adjusted Base Rate scales linearly with weekly hours before applying the bucket
- Transparent, auditable, and easy to communicate internally or to freelancers
Future Policy: Alignment and Growth
Considering True Value
While the current system guarantees your take-home pay, we recognize that the Base Hourly Rate can be another accurate reflection of the true value of the work done for Iguality. If so, this rate should be equal for equivalent roles.
Therefore, looking ahead, we may want to consider transitioning our compensation policy toward prioritizing a single, unified Equal Base Rate for all. This shift would place the principle of Equal Value of Service above a guaranteed Net Payout.
Contingency for Growth and Role Changes
This policy change would only be considered when Iguality would grow significantly, or specific team members would have strong increases in their current hours. Any transition would be managed with a view toward finding a balanced common rate that minimizes any negative or positive financial difference to the current established net payments. We commit to communicating and discussing any such policy change with team members well in advance.
Future Roles and Compensation Differences
Our commitment to equal pay will apply to all future contracts, including both freelancers and future employees. However, as Iguality grows and roles evolve, we may introduce differences in pay for both freelance and employee contracts. These distinctions will be based on objective factors, such as:
- Role and Responsibilities
- Level of Experience
- Contract Type and Duration (e.g., differentiating between a half-time versus a full-time position)
- Market Benchmarks
Any compensation differences between roles, whether for freelancers whose hours increase significantly or for future employees, will be prepared and discussed when the time comes, adhering strictly to all legal and collective agreements. These distinctions will always be clear, transparent, and compliant with all legal frameworks.
Additional Benefits and Development
In the future, we aim to offer comprehensive insurance and wellness benefits to our team members. We also provide regular training opportunities and share information on external events and workshops for professional development.