Los Angeles has passed a city ordinance called the Freelance Worker Protection Ordinance that took effect on July 1, 2023. This ordinance requires a written contract for independent contractors and freelance workers in Los Angeles County. A written contract is required for any Freelance Worker and Hiring Entity that enters a written or oral contract where the work performed is within the City of Los Angeles and has a payment of $600 or more in the calendar year.
The ordinance defines “freelance workers” as individual natural persons, or an entity that is held by, and whose work is performed by, an individual natural person. Further, under this ordinance, only “hiring entities” are the covered employees. The ordinance defines a “hiring entity” as an entity regularly engaged in business or commercial activity, including owning or operating a trade or business, a non-profit business, or an entity that represents itself as engaging in any trade or business.
If an employer is covered under this ordinance, additional information must be included in the contracts, including:
- The name, address, phone number, and email of both the hiring entity and the freelance worker;
- An itemization of all the services provided, along with the rate and method of compensation; and,
- The date by which the hiring entity must pay or how such date will be determined.
Lastly, there are violations for employers who do not comply with the ordinance. Such damages can include but are not limited to:
- An award of $250 if the freelance worker requests a written contract and the hiring entity refuses; and,
- Attorney’s fees and costs.
Employers who engage independent contractors in Los Angeles need to review their agreements with freelance workers to ensure compliance with this new law.