How the pandemic camouflages MLM franchising schemes

Even with life returning to a semblance of normal in many places, there are many people who find themselves structurally without a job as a result of the pandemic. Sometimes, people's jobs simply no longer exist, and sometimes they discover that the new way of working also implies being replaced by someone working from home in a different, cheaper country.

Linkedin is a welcome source of jobs, running from the most local entry job in shelf stacking to the highest levels of global management. Scrolling through hundreds of jobs a day, you might come across a number that are somewhat different than the others.

"Work from home, anywhere, anytime!" they extol, "no experience needed, just entrepreneurship and a good work attitude!" they promise. "Earn as much as you want, we train you up for the role!" the lure dangles ahead of you.

But there are some strings attached when it comes to performing these roles. You will find that many of them are a form of franchising, or contract work paid for solely from commission.

In the first case, it means that you are paying for the rights to use a certain business concept, and make use of their brand identity and logo as long as you work according to their rules. Be wary if the franchise is in personal wellbeing, executive coaching and financial independence. These can be code words for you selling the concept to others that you just were sold: a franchise selling a franchise, selling a franchise. Since each sold franchise reduces the potential market for that franchise, it's often a losing proposition and a classic pyramid scheme.

In the second case, it means money won't come to you unless you have made sales, meaning that the company is neither responsible for a wage, nor pensions or sick leave. Again, here you will likely be selling a pay-it-forward type of scheme in wellness, personal success or resilience, where a paid membership in their "guild" or "circle" is required to have the necessary certification to operate. Often, the certification demands a training scheme in company practices and how to operate your business, costing a lot of money as an "investment".

Any company worth their salt trains their employees in their operations for free as part of their onboarding! All of them - no exceptions.

Either way, you have to remember that it's very unlikely to find a legitimate job that requires you to pay ahead of time for the privilege of working. A job that only pays if you pay off, so pure commission, is also rare. Most employers understand that their people need to eat even in the leanest of times, and so this form of compensation would be pretty mean and lean!

So if a job won't share the details until you join their club, demands payment for membership, or a franchise that involves selling that franchise, walk away. You will not likely earn, but lose money from it.

I would like to refer you to Chuan-wei Chu's excellent guide on identifying pyramid schemes here: https://www.dhirubhai.net/pulse/how-identify-pyramid-schemes-part-1-chuan-wei-kevin-chu/

I found that reporting these jobs on Linkedin does not work very well, because the wording they use does not explicitly mark them as pyramid or MLM schemes, and without a person digging a little deeper it won't be taken down. Personally, I like to contact the people listed as references on their pages, and alert them to the fact that their names are being used to support this business. If they don't agree with the practice, they can ask to have the reference removed or even file charges.

Other than that I can only urge you to be careful and critical of the job applications you respond to. A job offer like this can seem like a glimmer of hope when your daily life is dark and your future prospects uncertain. But once you are in the clutches of charismatic people, you may find yourself some time later with even less money and a more uncertain future.

Ask questions, challenge the job opening, hold out for exact details on what kind of agreement it is. This is always good practice, and here even more so! And take care of each other, and fight unethical busines practices where you find them.

Have you had experiences with these pyramid franchises or self-improvement schemes? Something to add, or to educate us all with? Let me know in the comments!