Bill that Seeks to Protect Freelancers' Wages Passed in NY

Good news to all NY freelance workers as NYC has just passed a first-of-its-kind bill in the entire United States which aims at protecting the independent workers’ and freelancers’ wages. The bill is set to place great pressure on companies so that freelancers’ wages can be received promptly and without any complication.

The initiative was taken by the NYC Council as a recognition to the hardworking individuals in NYC who considered integral parts of the growing ‘gig economy’ in the USA. The bill was aptly called Freelance Isn’t Free Act and it is expected to set a sturdy precedent for providing protection to all types of work. This is according to the Director of Member Engagement of the Active Freelancer’s Union, Caitlin Pierce. The bill is not only focused on the protection to be provided for freelancers’ wages, but also on other aspects that are not covered by the labor laws in the state.

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Protecting Growing GIG Economy

GIG economy is composed of individuals who opt to work as freelancers or independent contractors. In New York City alone, about 38% of the total workforce are freelancers or independent contractors. The growing number has prompted the Union to take actions to ensure that the labor laws in the US are updated to protect the freelancers’ wages and other rights. In the United States, there are about 55 million people who work as freelancers. Although the bill was passed in NYC the Union hope this will help to make the United States become a more freelance-friendly community.

The Executive Director and founder of the Union, Sara Horowitz, also expressed her wish that companies will stop, shortchanging the independent contractors and freelance workers. One specific condition stipulated in the bill seeks to require companies who hire freelancers whose work is valued at around $800 and above to provide contracts in black and white. The contract should include the freelancers’ wages and the itemized services, the rate, the means of compensation, and the value of the services provided.

The bill specifically requires companies to send the freelancers’ wages no later than 30 days after the completion of service rendered if termination of the contract is not stated. For those freelancers who have been shortchanged by their companies, they can file complaints against the company through the Department of Consumer Affairs. Another option is to go directly to the small claims court in order to file a complaint seeking payment of the freelancers’ wages for the services rendered.

Another form of protection provided to the freelance workers is the anti-retaliation clause. This is to protect the freelancers or independent contractors from being blacklisted from other companies and to ensure equal chance of employment in the future. The penalties for not paying the freelancers’ wages on time and for not acknowledging their rights as workers are quite hefty. According to this bill, the civil penalties may reach up to $25000 for multiple violations. Attorney fees, statutory damages, and injunctive relief fees are also to be covered by the company. For cases of action taken individually, these would all be adjudicated in state courts.

The Bill at a Glance

Aside from ensuring that freelancers’ wages be paid no later than 30 days after the successful completion work, the Freelance Isn’t Free Act also includes other terms that are beneficial to the freelancers and independent contractors. Here is a quick sum up of the terms included in the newly-passed NYC Bill.

  • The hiring parties are prohibited from intimidating, harassing, disciplining, and threatening freelance workers and discriminating against him or her because of the complaints filed against the hiring parties. Taking actions that would reasonably deter the freelancer from future employment opportunities is punishable by law according to the Freelance Isn’t Free Act
  • A freelancer who has been aggrieved by any violation as per described in this law has the right to file an administrative complaint directly with the City of New York within two years after the act the violation has been committed. Whether it is about the failure to receive freelancers’ wages or any other violation such as retaliation or failure to put all working conditions in a contract, the freelancer is also given a time frame of two to six years to file a civil case against the hiring company.
  • Aside from the statutory damages, attorney fees, double damages, and injunctive relief, a freelance worker may also seek other remedies deemed appropriate when filing a case.
  • The City of New York may also file a civil action against any hiring company that is proven to be engaged in any activity that violates the conditions of the Bill. Civil penalties amounting to $25000 may also be sought.
  • This new bill does not restrict freelance workers and independent contractors from bringing other legal claims against the company that hired him or her. Breach of contract can also be filed on top of the civil or administrative cases filed in relation to this new act.
  • The bill will become effective 180 days after the Mayor signs the law. The law shall also be applied to the new work contracts entered during the period of effectivity.
  • This Act also authorizes the Office of Labor Standards of the City of New York to take all the necessary measures to promulgate the rules and to implement the law.

Gaining Support from the Mayor’s Office

The Act was drafted with the help of the Freelancers’ Union members. It was then in the latter part of the December 2015 when it was introduced to the NYC council by Democrat Brad Lander. This bill, which seeks to shed light on the rights and benefits of the freelance workers, is also expected to be signed by Mayor Bill de Blasio. Moreover, the union that helped come up with the bill is hoping that similar legislation will also be passed in other cities all across the United States. The passing of the Freelance Isn’t Free Act is considered a colossal success by the organization as it gives hope to the growing number of individuals and families who are dependent on freelancers’ wages. As per the statement released by the office of Mayor De Blasio, the Mayor is in full support for the action taken by the NYC Council. The Mayor also stated that his administration vows to work to ensure that the labor laws would protect and secure ALL the workers in New York. This is also in support of the freelance workers and independent contractors who continue to shape the 21st century with their creative thinking and the technology they are highly adept in.

CEO Carlo Scissura of the Chamber of Commerce of Brooklyn has also expressed his support to the bill stating that creative class members and the entrepreneurs will benefit from this as well. According to Scissura, freelance workers, and independent contractors are similar to small businesses, and therefore, correct payment of freelancers’ wages is expected.

However, not everyone is in agreement. Thomas Wassel expects that there could be some potential problems from the new bill. For instance, if the freelancer does a poor job, companies may still be forced to pay freelancers’ wages as there is not any legitimate method to verify the quality of the work completed. According to Wassel, this aspect should also be looked into.

Needless to say, the new Freelance Isn’t Free Act is a bold step to ensure that all workers – whether company-based, independent, or freelancer, are protected by law. Ensuring that the freelancers’ wages, contracts, and other work-related conditions are provided and secured send a clear message that the workers, in general, are valued in the American society. Keep yourself abreast with the latest on this Act and how to better protect the freelancers’ wages by keeping an open eye on the latest developments.