New York City freelancers will soon have much more protections under the aptly-named Freelance Isn’t Free Act. Catchy.
On November 16, 2016, Mayor Bill de Blasio signed into law the Freelance Isn’t Free Act. This Act sets forth requirements when hiring freelance workers, also known as independent contractors. Act becomes effective on May 15, 2017.
The Act requires a written agreement whenever an independent contractor is hired to perform services for at $800 in a 120-day period.
The writing must include:
- The name and mailing address of both the hiring party and the independent contractor;
- An itemization of all services to be performed;
- The value of services to be provided and the rate and method of compensation; and
- The date on which the hiring party must pay — if no payment due date is specified, payment must be made within 30 days of the completion of services.
Penalties for non-compliance are punitive. Independent contractors alleging a failure to comply with the Act, for example, failure to pay according to the agreed-upon terms, may file a complaint with the director of the Office of Labor Policy and Standards, a division of the NYC Department of Consumer Affairs. That Office will send a demand letter on behalf of the contractor that can be satisfied by making payment or producing proof of payment. If a hiring party fails to provide a sufficient response to the Office’s demand, the contractor may bring a civil action, under which the hiring party will be exposed to potential liability for double damages and attorneys’ fees, and will bear the burden of disproving liability. A hiring party that is found to engage in a pattern or practice of violating the freelance act may face a civil penalty of up to $25,000.
Please contact Douglas Lipsky of Bronson Lipsky if you have any questions.