After taking effect on July 1st, 2023, the new Los Angeles Freelance Worker Protections Ordinance has imposed additional legal requirements on businesses and employers across the city when it comes to handling contracts for freelance workers. Amongst the most notable chances, the law now demands written contracts for every job where a freelance worker will receive at least $600 from their employer. This written contract must include the following:
- The hiring entity and the worker’s personal details, including their names, each of their mailing addresses, phone numbers, and email addresses of both parts
- An item-by-item list of all services the freelance worker will provide or assist with, along with the rate or value of said services and the method of compensation used by the employer
- The freelance worker’s starting date, along with the date by which the employer must pay the agreed compensation, or the partial payment agreed upon
The ordinance has also provided updated definitions for the two parts involved in this contract, with a “freelance worker” now being defined as a natural person hired to perform independent contractor services in exchange for compensation provided by a “hiring entity”. A “hiring entity” on the other hand, is now understood as the part who either owns or operates a business or organization. It will be in charge of managing all communications with the worker, including those related to submitting payments or reaching a payment agreement.
Despite having a broad reach, the ordinance unfortunately still has some exclusions on employers who must receive a written contract, most notably including the following:
- App-based transportation services (such as Uber) or delivery drivers
- Any freelance worker who is already required by law to have a written service agreement
- Employees who are already working under the hiring entity
- Employees who agree to perform services for the hiring entity for no compensation