Freelancer Protections Under The Freelance Isn't Free Act
New York City recently passed the Freelance Isn't Free Act, which provides the strongest legal protections for freelancers in the country. Under the Act, freelancers can sue for nonpayment, underpayment, or late payment. Learn about the protections in the Freelance Isn't Free Act.
What is the Freelance Isn't Free Act?The Freelance Isn't Free Act protects freelancers working in New York City. The Act requires a written contract and includes high penalties if clients violate the contract. For example, if a client refuses to pay, freelancers can sue for double damages, or twice the value of the contract. If the contract does not include a payment date, clients must pay freelancers within 30 days of completing the contracted services. Late payment also means double damages for the freelancer.
The Freelance Isn't Free Act also protects freelancers from retaliation, harassment, or intimidation.
Mayor Bill de Blasio signed the Freelance Isn’t Free Act into law on November 16, 2016. The law went into effect on May 15, 2017. Freelancers with contracts signed after May 15, 2017 can enforce them under the Act.
Who's Covered Under The Freelance Isn't Free Act?The Freelance Isn't Free Act covers individuals hired for pay as freelancers or independent contractors. Freelancers must perform a minimum of $800 of work within a four month period to receive protections. The Act does not cover organizations of more than one person, but it does cover individuals who use a trade name or are incorporated.
The Act does include exemptions for sales representatives, licensed practicing attorneys, and licensed medical professionals. It also does not apply to freelancers working for federal, state, local, or foreign governments.
In New York City, over 500,000 people work as freelancers or independent contractors. They earn over $24 billion a year. The Freelance Isn't Free Act provides vital protections for these freelancers.
What Damages Can Freelancers Receive?The Freelance Isn't Free Act protects freelancers from late payment, underpayment, or nonpayment. The Act provides double damages if a client violates the contract. In other words, if your client refuses to pay, underpays, or pays late, freelancers can receive double the value of the contract.
Clients who violate the Freelance Isn't Free Act must pay twice: they pay the original contract value plus a penalty equal to the value of the contract. The Act also provides damages for retaliation. If, for example, a client threatens to give a bad review unless the freelancer agrees to a lower rate, the freelancer can file for double damages for each act of retaliation.
How Long Can Freelancers File?Under the Freelance Isn't Free Act, freelancers can file for nonpayment, underpayment, or late payment for six years. Freelancers can file for not receiving a written contract for two years. The penalty for not receiving a contract is $250.
However, the Freelance Isn't Free Act is not retroactive. Freelancers can only file claims on contracts signed after May 15, 2017, when the Act when into effect.
What Should Freelancers Do if a Client Refuses to Pay?If a client refuses to pay, underpays, or pays late, freelancers can file a claim under the Freelance Isn't Free Act. An employment lawyer can help freelancers sue for double damages. Many employment lawyers work on contingency, meaning they only get paid if the freelancer recovers money. The Freelance Isn't Free Act also covers reasonable attorney fees for freelancers who win their claim.
Reach out to a New York employment lawyer if you have a claim under the Freelance Isn't Free Act