Freelance Law Impacts New York City Employers

A new freelance law impacts New York City employers. The Establishing Protections for Freelance Workers Act (also known as the Freelance Isn’t Free Act), went into effect earlier this month. For companies located in New York City that contract with freelance workers, the law requires them to provide a written freelance contract, to pay freelancers timely and in full, prohibits retaliation against freelancers exercising their rights under the new law, and designates penalties against employers for non-compliance with the new regulations.

A freelance worker is defined by the new law as a sole person who is hired as an independent contractor and is paid to provide services. Commission-based sales representatives (as defined in section 191 of the New York Labor Law), licensed medical professionals, and lawyers are specifically excluded from this definition.

Employers in New York City that hire a freelance worker must now meet the following requirements:

1. If a freelancer is hired for services that will cost $800 or more, whether it’s for one project or multiple ones done within a 120-day period, the employer must provide a written contract. The contract must include the name and address of the employer and freelancer; a list of the services to be performed, the cost of each item, and the method of payment; and the date that payment is to be made.
2. Employers must make all payments in full and in a timely manner. If there is no contract or the contract does not state the time that payment is to be made, the employer must pay the freelancer within 30 days of the services being completed.
3. Employers may not retaliate or take any action against a freelancer who exercises his/her rights under the new law.

New York City employers that use independent contractors should evaluate whether any of those contractors would be classified as a freelance worker under the new law’s definition. If so, we advise looking at their practices for hiring and payment to ensure they are in compliance with the new law’s requirements.

NOTE: the Freelance Law does not impact the way independent contractors and employees are classified. Regardless of whether an independent contractor is a freelancer or not, they cannot be classified as an employee, and vice-versa.

For more information, contact us at (518) 373-4111.