What does FIFA mean for business owners?
Small business owners in New York City already are under a lot of regulations, but even so, another one has been added to the list — FiFA, The Freelance Isn’t Free Act.
The act passed in the fall of 2016 and went into effect on May 15, 2017. New York City is the first city in the nation to have this kind of law.
FIFA Guidelines that Business Owners Must Abide By
The NYC.gov site explains the responsibilities for business owners as outlined in the law.
Hiring Party Definition
A business other than a government entity that hires a freelancer is a hiring party.
Any individual that a business owner hires or retains as an independent contractor to provide services in exchange for compensation is a freelance worker. A few common examples are home contracting and repair, photographers, graphic and web designers and translators. You may want to consult with an employment defense lawyer if you have questions as to whether someone working for your business meets the legal definition of an independent contractor/freelance worker.
All work that is done for $800 or more within a 120-day period must have a written contract. You and the freelance worker must both keep copies of the contract.
You must pay the freelance worker for all completed work on or before the date stated in the contract. If the contract does not state a payment date, then payment is due within 30 days after the freelancer finishes the work.
A freelance worker has the legal right to file a complaint with the DCA’s Office of Policy & Standards, and the DCA notifies business owners when a complaint is filed. The business owner must respond to the notice of complaint in writing within 20 days. In civil actions filed by freelancers, the judge will presume the violation occurred if the business owner hasn’t responded to the notice.
Retaliation against freelancers, which includes penalizing, threatening or blacklisting freelancers for exercising their legal rights is illegal.
As a result of a civil action, if the court finds the business owner violated FIFA, the business can be liable for:
- Double damages for late payment or nonpayment
- Additional damages for failure to provide a written contract or retaliation
- Attorneys’ fees and costs
Stephen Hans & Associates has decades of experience assisting business owners with employment related concerns.