A New York City law aims to address no-pay and slow-pay problems for independent workers. Will the rest of the country follow suit?
On the theory that trends move in from the coasts, a law that went into effect May 15 in New York City needs national notice.
The city’s new Freelance Isn’t Free Act addresses no-pay and slow-pay problems for freelancers in the growing gig economy. It’s believed to be the country’s first such law.
An estimated 4 million workers in New York City — and perhaps 55 million nationally — do freelance work, which means they’re not operating in the traditional employer-employee relationship. They often don’t have pay protections provided by the Fair Labor Standards Act or even have written contracts.
The new law applies to freelancers in New York City and those who hire them, no matter where the hirer is based. It provides for the right to a written contract when the work is valued at $800 or more and the right to be paid in full by the date specified in the contract or within 30 days of the work being completed.
The measure excludes medical professionals, lawyers and sales representatives from coverage, but it embraces a range of workers such as those who do home contracting and repair, web design, film, video, photography and graphic arts, media relations and translation services.
“It’s a start,” Julie Cortes, founder of the Kansas City Freelance Exchange, said of the New York City law. “The pay problems are definitely prevalent.”
Given the evolution in work, it’s possible that one-third of U.S. workers could benefit from the kind of pay protection afforded by the New York City law, depending on whether other cities or states pass similar measures.
It would be the right thing to do.
A survey by the Freelancers Union, leading up to passage of the New York City law, found that nearly three-fourths of freelancers surveyed said they had problems getting paid. Some were completely stiffed, with no real recourse other than pursuing a lawsuit that likely would cost more than the amount they weren’t paid.
New York City’s Office of Labor Standards, within its Department of Consumer Affairs, will provide some teeth to enforce the new law, but costly claims court actions still might be the only recourse for aggrieved workers.
In a perfect world, “do the right thing” would apply and payments would proceed as promised, even if agreements were made on handshakes. Imperfect as it is, we need Freelance Isn’t Free reminders.
The alternative is what Cortes says happens now, particularly in the advertising and marketing industries. Hirers sometimes refuse to pay for the freelancer’s time when they subjectively don’t care for the work submitted. Instead, she said, they should try to work out a solution.
“Here in Kansas City we’re a tight-knit community. We talk,” she said. “When people stiff us, it’s not uncommon for the rest of the group to know. If you want to preserve your reputation, pay your bills.”
Diane Stafford is the workplace and careers columnist at The Kansas City Star. Email her at email@example.com.