A reader writes:

My sister and I have a difference of opinions on whether an MLM (multi-level marketing) consultant could put “business owner” as their title on a resume.

My sister’s opinion is, “You’re putting your own money into it, you’re paying to use the name, you’re hiring your people, and responsible for all sales, training, accounting, organizing. And you’re relying on the success of your specific part of the business in order to make money, not on [the company] as a whole.”

My view is that this is not the same as owning an independent business, because the consultant does not actually hire, fire, or directly pay their downline. My sister thinks it’s the same as, for example, the owner of a McDonald’s calling herself a business owner, even if they don’t OWN McDonald’s corporation, but I think it is pretty different. Thoughts?

This has come up because we are trying to help our mom on her resume, and she has been a consultant with an MLM for 20+ years and has led a large team of over 200+ consultants. We’re trying to help my mom polish her resume, and this is her most relevant work experience.

People who sell products for MLMs are salespeople, not business owners. (For readers who don’t know the term: MLMs = multi-level marketing schemes, like Herbalife or Lularoe, as well as older ones like Mary Kay.)

MLMs like to tell the people they’re trying to recruit that they’ll be small business owners, probably because it helps them disguise the reality that a huge percentage of the people who sell their products don’t make a profit, and even lose money. (Your mom seems to be an exception, fortunately.)

But MLM consultants aren’t business owners. The law considers them independent contractors. And that makes sense: They don’t set their own pricing, make branding decisions, or control product development, manufacturing, or distribution. They don’t qualify for small business loans. They’re accountable to the MLM itself, which can kick them out at any time. They don’t have employees in the legal sense, just additional recruits to the MLM.

By contrast, someone who buys a restaurant franchise is a franchisee, and is running a far more complex business in which they hire and fire employees, pay payroll taxes, pay their staff wages regardless of their profits, and exercise significant control over their hours and work.

The accurate title for an MLM on a resume is “sales rep.”

Another big reason it’s in your mom’s best interest to use that: If she lists “business owner,” most people will find that over-inflated and will assume she’s either naive about what goes into owning a business or choosing to inflate the work to a ridiculous degree. “Business owner” will also set off alarm bells for a ton of people who associate that with how scammy MLMs encourage their sales reps to think of themselves, and it’s likely to weaken her as a candidate rather than strengthening her.

Honestly, normally I’d suggest people leave MLMs off their resumes entirely because of the strong stigma against them (due to their exploitative business model, which especially preys on women) and because it’s a hard sell to argue MLMs provide their reps with provide transferable skills. Most of the time, including an MLM on a resume will be a negative, not a positive. It’s harder in your mom’s case if it’s been her primary work for the last 20 years — but if she has other experience, I’d put the focus there instead.