By: Ryan Wisniewski, CPA

New York State has taken a significant stride in safeguarding the rights of freelance workers through the recent enactment of the "Freelance Isn't Free Act" by Governor Kathy Hochul. This legislation, akin to protections already established in New York City, is designed to ensure equitable treatment and timely compensation for freelance workers statewide. Overview: The Freelance Isn't Free Act, signed into law by Governor Hochul on November 22, 2023, as Senate Bill (B) 5026 / Assembly Bill (A) 6040, represents a pivotal moment in freelance worker protection. Scheduled to be effective from May 20, 2024, the act will be incorporated as a new Section 191-d of the New York Labor Law. Notably, this follows Governor Hochul's prior veto of a similar bill in December 2022. Key Provisions:

  1. Freelancers Defined:

- The law encompasses individuals or organizations engaged as independent contractors by a hiring party, with compensation totaling at least $800 or $800 in aggregate over 120 days. Exclusions apply to worker categories such as sales representatives and licensed medical professionals.

  1. Timely Payment:

- Hiring parties are obligated to indemnify freelancers of their contracted compensation on or before the specified due date in the contract or within 30 days after the work's completion if no date is specified. Any attempt to condition payment on accepting reduced compensation is explicitly prohibited.

  1. Written Contracts:

- All freelance agreements must be documented in writing, incorporating essential details like the parties' identities and addresses, service breakdown, compensation terms, and submission deadlines. Model contracts, facilitated by the New York State Department of Labor (NYSDOL), will be available for public use.

  1. Retaliation Prohibited:

- The act prohibits hiring parties from retaliating against freelancers who assert their rights under the law.

  1. Complaints and Remedies:

- Freelancers reserve the right to lodge complaints with the labor commissioner to investigate and resolve violations. Remedies may include statutory damages, double damages, injunctive relief, and attorney's fees. Recommendations: Employers engaging freelancers in New York are advised to review their existing agreements and operational procedures to ensure alignment with the Freelance Isn't Free Act. Regularly monitoring the NYSDOL's website for updates and access to model contracts is recommended.

At Reynolds + Rowella, we recognize the significance of staying abreast of and compliant with evolving legislation. We encourage you to contact our team for further support or guidance on navigating the Freelance Isn't Free Act. We remain committed to monitoring developments related to this legislation and providing necessary updates.

Reynolds + Rowella is a regional accounting and consulting firm known for a team approach to financial problem solving. As Certified Public Accountants, our partners foster a personal touch with our clients. As members of DFK International/USA, an association of accountants and advisors, our professional network is international, yet many of our clients have known us for years through the local communities we serve. Our mission is to operate as a financial services firm of outstanding quality. Our efforts are directed at serving our clients in the most efficient and responsive manner possible, delivering services that exceed the expectations of those we serve. The firm has offices at 90 Grove St., Ridgefield, Conn., and 51 Locust Ave., New Canaan, Conn. For more information, please contact Elizabeth Bresnan at 203.438.0161 or email.  


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