NY Freelance Isn't Free Act: What Employers Need to Know

If your Long Island business works with freelancers, consultants, or independent contractors, you need to understand New York's Freelance Isn't Free Act. This law creates specific protections for freelance workers and places important requirements on businesses that hire them.

Whether you're a medical practice using freelance medical coders, a law firm hiring contract attorneys, or an accounting firm working with seasonal tax preparers, this law likely affects your business relationships.

What Is the Freelance Isn't Free Act?

The Freelance Isn't Free Act is a New York law that protects freelance workers from common payment problems. Think of it as a set of ground rules that makes freelance relationships more professional and predictable for everyone involved.

The law applies when you hire a freelancer or independent contractor for work valued above a certain threshold over a specific time period. It covers a wide range of professional services, from graphic design and writing to consulting and specialized professional work.

The key insight behind this law is simple: freelancers often face late payments or non-payment, which can devastate their businesses. By creating clear rules and consequences, the law encourages better business practices and protects both parties.

How the Law Works

The Freelance Isn't Free Act has three main requirements that affect how you work with freelancers:

• Written Contracts: You must have a written contract for covered freelance work. This can't be just a handshake deal or verbal agreement.
• Payment Timelines: You must pay freelancers by the date specified in the contract, or within 30 days if no date is specified.
• No Retaliation: You cannot retaliate against freelancers who assert their rights under this law.

The written contract must include specific information: the names and addresses of both parties, an itemization of services, the rate and method of compensation, the date payment is due, and the date by which services must be provided.

Why This Matters for Your Business

Beyond legal compliance, following these practices creates better business relationships. Written contracts prevent misunderstandings about scope, deliverables, and payment terms. Clear agreements help projects run smoother and reduce disputes.

Many businesses find that formalizing their freelancer relationships actually improves the quality of work they receive. When expectations are clear upfront, freelancers can deliver exactly what you need.

The law also helps level the playing field. Professional freelancers prefer working with businesses that have clear, fair processes. This can help you attract higher-quality freelance talent for your projects.

What Freelancers Get

From the freelancer's perspective, this law provides important protections. They have the right to receive written contracts that clearly outline the work and payment terms. They can't be asked to work on vague verbal agreements for substantial projects.

Freelancers also get predictable payment timelines. Instead of wondering when they'll be paid, they know exactly when payment is due. This helps them manage their own cash flow and business operations.

If there are payment disputes, freelancers have legal remedies available, including the ability to recover damages and attorney fees in certain situations. This gives them more leverage to resolve payment issues professionally.

Key Considerations for Implementation

Start by reviewing your current freelancer relationships. Do you have written contracts in place? Are your payment terms clearly specified? Many businesses discover they need to formalize processes they've been handling informally.

Consider creating standard freelance contract templates for common types of work. This makes it easier to engage freelancers quickly while ensuring compliance. Your contract should be specific enough to prevent disputes but flexible enough to use across different projects.

Review your accounts payable processes to ensure you can meet the payment timeline requirements. Late payments can result in significant penalties, so reliable payment systems are essential.

Think about how this law intersects with other employment considerations. While this law covers freelancers, you still need to properly classify workers as employees versus independent contractors under other employment laws.

How Benton Oakfield Helps

Navigating employment and contractor compliance requirements can be complex, especially when you're trying to focus on running your business. At Benton Oakfield, we help Long Island businesses understand their compliance obligations and develop practical solutions.

We work with businesses across Nassau and Suffolk Counties to create compliant processes that actually work in practice. Rather than just explaining the rules, we help you implement systems that protect your business while maintaining good relationships with the freelancers and contractors you depend on.

Our approach focuses on practical solutions that fit your specific industry and business model. We understand that a medical practice has different needs than a law firm, and we tailor our guidance accordingly.

If you're unsure about how the Freelance Isn't Free Act affects your business, or if you need help developing compliant freelancer processes, contact us to discuss your specific situation.

Compliance Note: Benefit plan rules and tax implications vary based on company size and location. This guide is for educational purposes only. Please contact your Benton Oakfield representative to discuss how this applies to your specific situation.

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