Four Things You Should Know About the Freelancer Payment Protection Act

by Gabrielle Wuolo

1. What is the Freelancer Payment Protection Act? The Freelancer Payment Protection Act is legislation introduced in New York State to help independent contractors collect compensation from their nonpaying clients. The bill was introduced in 2011 by Assembly Speaker Silver and Senators Golden, Lanza, and Squadron. The current bill numbers are A6698A and S4129B. 2. Who would this bill help? If you haven’t been paid by a client and wish to benefit from this legislation (i.e., file a complaint against your client), you would need to meet all of the following criteria:

  • Be an independent contractor/sole proprietor. (If you’re an employee, you likely already qualify to file a wage claim.)

  • Expect to be paid more than $600 by the client

  • Performed work in New York State for the client, which could be a corporation, limited liability company, partnership, association, or non-profitmaking organization.
    3. How would this bill help? If you meet the criteria above, you could contact the New York State Department of Labor, and they could investigate your complaint. If it is found that you were paid less than you were entitled to, you may be able to receive:

  • 100% of what you are owed, plus:

    • Up to 100% of what you are owed in liquidated damages
    • Attorney’s fees
    • Interest on the amount owed
      We anticipate that the bill, if enacted, would also help act as a deterrent against clients who repeatedly do not pay, since they may owe the following as penalties to the state:

  • Double the total amount found to be due as a civil penalty

  • Misdemeanor for the first offense, fined $500-$20,000

  • Felony for the second offense, fined $500-$20,000 or imprisoned for up to one year
    4. What can I proactively do right now?

  • Always use a contract or written agreement that clearly lays out the amount of money you expect to be paid and when you expect to be paid. This should be signed by both you and your client. It’s important to have this documentation to support your complaint.

  • Contact your legislator and ask him or her to co-sponsor this bill.

  • If you live in the NYC area, join our next Monthly Member Meeting, on June 15, where we’ll continue to build on our Get Paid, Not Played campaign.
    (photo by Bill on Capitol Hill, via Flickr)

More from the Freelancers Union blog