New York City employers might want to take a look at some new rules taking effect as a result of the Freelance Isn’t Free Act, passed unanimously by the New York City Council last November.
A Gothamist report that appeared days after the law’s passage points out that it is the first law in the country to provide freelancer protections against nonpayment, and that “the legislation mandates that freelancers be paid in full for their work either by a date set forward in writing, or within 30 days of completing an assigned task. The law also aims to protect freelancers from employer retaliation, and can increase monetary consequences for employers who refuse to pay.”
The law, which took effect in May, is augmented by rules taking effect July 24 that, according to the Society for Human Resource Management, will result in increased scrutiny of independent contractor relationships. The rules, according to a New York City Department of Consumer Affairs notice, “clarify provisions in the law, establish requirements to implement and meet the goals of the law, and provide guidance to covered hiring parties and protected freelance workers.”
FAQs about the act can provide employers who use freelancers with information about effects of the act on their relationship with freelance workers. Richard Greenberg, an attorney with Jackson Lewis in New York City, is cited in the report saying that the rules reinforce the city’s position that businesses shouldn’t abuse freelancer relationships.
Freelance workers in the city who perform services valued at $800 or more are protected by rules that require a written contract; timely, full payments for contract work; and freedom from retaliation, among other things.
The rules also specify that the act’s anti-retaliation provisions protect freelancers from any adverse actions by a hiring party “that would constitute a threat, intimidation, discipline, harassment, denial of a work opportunity or discrimination” or that would penalize or deter freelancers from exercising their rights under the act.
In addition, according to an advisory from Davis Wright Tremaine LLP, businesses are prohibited from including in freelance agreements waivers of the right to participate in class or collective actions; waivers of “any other procedural right normally afforded to a party in a civil or administrative action … [which] include[s] but [is] not limited to procedural rights of parties to a civil action established by the New York Civil Practice Law and Rules, the Federal Rules of Evidence, and the Federal Rules of Civil Procedure;” and confidentiality provisions that preclude the disclosure of the contents of the agreement to the Director of the New York City Office of Labor Standards.
The Act, the advisory adds, “requires businesses to enter into written agreements with freelancers operating in New York City if the services to be provided have a value of $800 or more. A written agreement is likewise required by the Act if multiple contracts with the same freelancer over a 120-day period total $800 or more.”
So what constitutes a freelancer? Gothamist says the definition “is broad: ‘any natural person,’ incorporated or not, who is hired as an independent contractor to provide a service in exchange for money,” adding, “A spokesperson for the Freelancers Union rattled off some examples this week: home health care workers, artists, musicians, graphic designers, stage technicians on Broadway, dog walkers, journalists.”
And lest employers think the law might not be noticed, the National Writers Union/UAW Local 1981 is already on the case, taking on the EBONY Media Organization and its parent company the Clear View Group after it says “they failed to meet a self-imposed deadline to compensate as many as 50 freelance writers who are owed as much as $200,000.”
According to NWU, it is representing “30 writers who are owed about $60,000. EBONY did issue checks to eleven writers for a total of $18,000,” it says on its website, but adds that just three of those writers were paid in full — so the next stop is the courtroom.
On the NWU website, NWU President Larry Goldbetter is says, “Creatives don’t work for free and there are very real consequences when we don’t get paid.” He adds, “EBONY is not the only offender,” adding that nonpayment is “an epidemic” for freelance writers and that the NWU is “hearing from writers at other publications as well.”
Whether the freelancer in question is a musician, writer, dog walker or designer, employers violating the act could face steep penalties, SHRM says, and HR personnel need to be sure that agreements are run through HR so that practices are both constant and compliant.
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