Verizon’s betting big on Yahoo Finance, but the site’s built on a cohort of ‘permalancers’ that former employees say is demoralizing and bad for business
- Yahoo Finance employs “permalancers,” contract workers with job responsibilities and hours indistinguishable from full-time staff.
- These are employees who write for the website, anchor news programs, and produce the daily financial news programs.
- Former employees who spoke with Business Insider said the labor practices were frustrating and demoralizing.
- These employment practices are uncommon in newsrooms and could be bad for business.
Verizon is betting big on Yahoo Finance.
The telecom behemoth is investing in the digital media property, hiring big-name talent away from its financial-news rivals, ramping up video to a full day of live-streaming news, and launching a paid subscription service for content.
But for some, the investment is at odds with a newsroom built on a cohort of “permalancers,” or contract workers with job responsibilities and hours indistinguishable from full-time staff, but with none of the benefits.
Business Insider spoke to five current and former Yahoo Finance employees, who said these “permalancers” write for the website, anchor news programs, and produce the daily financial news programs. In November, the company posted a new job opening for a front-page editor that was a contractor position, requesting applicants with three to five years of editorial experience and the ability to work “early mornings, late nights, holidays and weekends.”
Some of those former employees left because they were unable to become full-timers, while others were let go from contracts that allowed the company to fire at will. Four of them said that it was virtually impossible to tell the difference between full-time and contract employees.
“I can tell you that [editor in chief] Andy Serwer [said] they ‘hire contractors all the time’ or ‘we have a lot of contractors working for us,'” one former contractor told Business Insider.
Sources who spoke with Business Insider put the percentage of contractors in the newsroom at about 25%. Yahoo Finance and parent business unit Oath declined to comment for this story.
Some of the employment practices felt intentionally deceptive, the employees said. For example, some contract workers supposedly had a path to full-time employment once they worked at the company for a year. To skirt this stipulation, management fired staffers just ahead of the one-year mark, then hired them back shortly after, they said.
“I felt frustrated. They had terrible hiring practices,” another former Yahoo Finance contract employee who worked at the company for several years told Business Insider.
Unlike full-time staff, contract workers at Yahoo are ineligible for company benefits, like health insurance and the ability to contribute to Yahoo’s 401(k) savings plan. Contractors don’t receive paid time off for sick days, maternity leave, or vacation. And other perks offered for free to full-time staff, like access to the company gym, are available to Yahoo contractors for a nominal fee.
Some contracts at Yahoo Finance, like those given to employees who anchor on news programs, aren’t bound by the same one-year rule for transition to full time. Yahoo hires some staff under these “talent” contracts, and employees work indefinitely without the ability for conversion to full time, according to former Yahoo Finance staff. One former employee told Business Insider they worked for the company for years without health insurance or a paid vacation.
The employment strategies at Yahoo Finance aren’t new. They’re a long-established practice predating Verizon’s acquisition of the company in 2017, according to former employees of the company.
But using employee contractors in newsrooms is unusual, according to union representatives with visibility on employment practices in the industry.
“It’s uncommon,” Tim Schick, administrative director at The News Guild, told Business Insider. “To my knowledge that practice is more prevalent in software development and tech type work than at newspapers or digital operations.”
Schick knows of no newsrooms with significant numbers of editorial contractors, which he described as a wholly different scenario than freelancers, who typically have more freedom to choose when and where they work. In news media, “you’re either an employee or you’re a freelancer as opposed to what you’re describing, which is a lower paid contract worker,” he said, adding that such a model allows a business to employ a “more disposable lower class of workers.” The News Guild represents newsrooms like The Daily Beast, Raw Story, and The Guardian.
“We have not encountered shadow newsrooms where a significant portion of the work [is] assigned to contractors,” Lowell Peterson, executive director of the Writers Guild of America, East, told Business Insider in an email. The Writers Guild represents newsrooms like The Huffington Post, which is also a digital-media property owned by Verizon.
It’s not that contract work is uncommon in all industries. Historically, contractors have been prevalent in job functions like construction or agriculture. And the percentage of contract workers in the labor force is up 60% since 2005 in all 13 sectors of the economy, Becky Frankiewicz, president of employment staffing firm ManpowerGroup North America, told Business Insider.
Recently, there’s been a focus on so-called “shadow workforces” in the high-growth tech sector that often relies on gig economy workers for short-term projects. The growth in contractors at Google exemplifies this trend. Contractors outnumbered full-time employees at Google’s parent company Alphabet for the first time history this year, Bloomberg reported in July. Alphabet declined to comment to Bloomberg on the exact number of contract workers it employs.
A hallmark of independent contract work is that employees typically have more flexibility to determine the specifics of their service, forming their own work-day schedules, negotiating rates for services, and essentially running their own small businesses. But employee contractors, those that Schick described as a lower-tier staffer working shoulder-to-shoulder with full-time staff but with none of the benefits and often for lower pay, don’t have this flexibility and usually don’t elect to work this way.
The use of employee contractors benefits management as these employees have less long-term ties to the business operation and would be the first to go if the company downsizes, according to Schick.
But the transient nature of these employees cuts the other way too, building a cohort of uncommitted workers whose prospects are limited and are apt to leave the company when more stable opportunities arise.
“It’s not inspiring to be there everyday,” a former Yahoo Finance contractor told Business Insider. “There is no opportunity to ever become permanent. It’s just temp, even for people running the show.”
The future at Yahoo
Verizon acquired Yahoo in 2017 and combined its assets with that of previously acquired AOL. The idea was to create a media juggernaut then named Oath. Today, Oath in name is dead, rebranded to Verizon Media Group. A slew of media execs pivotal to the conception of Oath are also gone, including CEO Tim Armstrong, who left in October, and Simon Khalaf, head of Oath’s media brands, who left in April.
Over the past year, the integration between AOL and Yahoo has been rocky, with massive layoffs and constantly changing strategies, according to former Oath employees. Amid the layoffs, Yahoo Finance was relatively insulated from the turmoil, employees said, feeling their line of business was designated the “golden child.”
But the business strategy at Yahoo Finance was equally volatile, according to the employees, who described “wild swings” in guidance from week to week. “First the direction was that no interviews could be longer than two minutes. Then a week later, no one cares at all,” a former employee told Business Insider.
Contractors were hired during this time in an effort to push short videos onto various Verizon platforms, according to a former Yahoo employee.
Yahoo Finance is now working towards eight hours a day of live programming — another change that staff will need time and sufficient leadership to effectively achieve, the employee said.
The newsroom may gain stability as Yahoo seems committed to building out a full day of live programming with several high-profile additions in recent months. Yahoo hired Julie Hyman from Bloomberg Television and Adam Shapiro from Fox News as anchors in October. This summer Andy Hoffman, a veteran news producer who helped launch Fox Business, joined the staff as senior executive producer.
And despite a turbulent integration at Oath, Yahoo Finance still has significant viewership. The company had 84 million unique visitors in September, according to Comscore.
What remains unclear is whether as Yahoo continues to invest in top talent for its news programs, the contract workers who contribute to the site’s success choose to stay.
“There is frustration at Yahoo Finance; they’re losing talent for this reason,” a former employee said.
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