Employees possess a wide range of legal protections and benefits that freelancers, who work for themselves, do not. This often leaves freelancers vulnerable to the whims of their clients, who can potentially threaten a freelancer’s livelihood in ways that would be plainly illegal if done to an employee. On March 20, 2024, New York will make significant strides in addressing this disparity when the state’s Freelance Isn’t Free Act, which builds off of similar protections that exist under New York City Law, goes into effect statewide. The Act provides significant benefits to freelancers, providing clarity to work arrangements and tools to punish hiring parties that attempt to cheat freelancers of compensation.
Under the Act, parties that wish to hire freelancers for services that exceed $800.00 in a 120 day period will need to create a written agreement that lays out the terms of the service and includes certain minimum provisions, including the compensation rate and method of payment for services and the due date for payment. This written agreement must be retained for at least six years.
If payment is not provided as under the agreement or later than 30 days after the completion of the freelancer’s services, the law provides for multiple avenues for freelancers to receive compensation. Freelancers can file complaints with the New York State Department of Labor, which is empowered to investigate and potentially award the freelance worker the benefit of their contract and potentially levy civil and criminal penalties against the hiring party. Alternatively, freelancers are permitted to file a lawsuit directly in court. There, freelancers are “entitled to an award of double damages, injunctive relief, and other such remedies as may be appropriate” as well as “statutory damages equal to the value of the underlying contract for each violation.” These damages can be significant, and function as a powerful disincentive against hiring parties slow-walking payments to their freelancers.
Whether an employee or a freelancer, powerful legal tools are available in New York to use against parties that try to shirk their responsibility to pay for work performed. Speak to an experienced employment attorney right away to learn your rights.