In support of the rapidly growing freelance workforce, the City of Los Angeles has issued the Freelance Worker Protections Ordinance (“FWPO”) which went into effect on April 24, 2023.
What is the purpose of the FWPO and who does it apply to?
The FWPO aims to address challenges faced by freelance workers, who, despite being an essential component of the modern economy, often lack the same level of protections as traditional employees. It applies between hiring entities and freelance workers, as defined in the ordinance.
FWPO mandates that a hiring entity doing business in the City of Los Angeles, or that hires an independent contractor to perform services in the City of Los Angeles, comply with certain contract formation, payment, and recordkeeping requirements. Such requirements are applicable to any written or oral contract between a freelance worker and a hiring entity, entered into on or after July 1, 2023, and any work performed within the city by a freelance worker that is entitled to payment of $600 or more in a calendar year for the same hiring entity.
What are the requirements of the FWPO?
Notably, any contract entered into between a hiring entity and a freelance worker valued at $600 or more, either by itself or when aggregated with previous written or oral contracts between the hiring entity and the freelance worker, must be in writing, and must include the following information:
- The name, mailing address, phone number, and, if available an e-mail address of both the hiring entity and the freelance worker;
- An itemization of services, including the value of services and the rate and method of compensation; and
- Contract payment date or manner by which the date will be determined.
Furthermore, full payment must be completed either by the date indicated in the written contract or, in certain instances, within 30 days following the completion of services, and both the hiring entity and freelance worker must keep written records regarding the provision of services for no less than four (4) years.
The FWPO prohibits any form of retaliation against a freelance worker for enforcing its rights under the ordinance or attempting to uphold its provisions. Furthermore, contractual agreements cannot be used to waive the obligations between the hiring entity and the freelance worker.
What are the penalties for non-compliance?
The FWPO provides that a freelance worker may file a complaint with the Department of Public Works’ Office of Wage Standards of the Bureau of Contract Administration, within a year of the alleged violated of the FWPO. Additionally, a civil cause of action may be bought by the freelance worker in any court of competent jurisdiction. In the event of a violation, freelance workers who prevail on a claim are entitled to damages, attorney’s fees, costs, injunctive relief, and other remedies.
Conclusion and Contact
This communication is not intended to be an exhaustive explanation of the requirements of the FWPO, and we encourage employers to seek legal advice for your specific situation.
If you have any questions or need assistance determining whether the provisions of FWPO apply to you or your Company, please contact Kurtis Urien at email@example.com or 714-972-2333.