Comparing SB 988 → SB 2041 — FREELANCE WORKER PROTECTION

Struck = only in SB 988 · added = only in SB 2041.

Previous
Latest
Bill Text - SB-988 Freelance Worker Protection Act.
*LRB10330684SPS57150b* SB2041 103RD GENERAL ASSEMBLY State of Illinois and 2024 SB2041 Introduced 2/9/2023, by Sen.
skip to content home accessibility FAQ feedback sitemap login x Quick Search:
Cristina H.
Bill Number Bill Keyword Home Bill Information California Law Publications Other Resources My Subscriptions My Favorites Bill Information >> Bill Search >> Text Bill Text PDF2 Bill PDF |Add To My Favorites | Version:
Pacione-Zayas SYNOPSIS AS INTRODUCED:
09/28/24 - Chaptered 08/30/24 - Enrolled 08/19/24 - Amended Assembly 04/18/24 - Amended Senate 04/01/24 - Amended Senate 01/30/24 - Introduced SB-988 Freelance Worker Protection Act.(2023-2024) Text >> Votes >> History >> Bill Analysis >> Today's Law As Amended >> Compare Versions >> Status >> Comments To Author >> Add To My Favorites >> SHARE THIS:
New Act Creates the Freelance Worker Protection Act.
Date Published:
Provides that freelance workers must be compensated by hiring parties for their services in a timely manner.
09/30/2024 09:00 PM SB988:v94#DOCUMENTBill Start Senate Bill No.
Provides that whenever a hiring party retains the services of a freelance worker, the contract between the hiring party and the freelance worker shall be reduced to writing and signed by both parties.
988 CHAPTER 870An act to add Part 5 (commencing with Section 18100) to Division 7 of the Business and Professions Code, relating to independent contractors.
Provides that no hiring party shall threaten, intimidate, discipline, harass, deny a work opportunity to, or discriminate against a freelance worker, or take any other action that penalizes a freelance worker for, or is reasonably likely to deter a freelance worker from, exercising or provisions concerning enforcement;
[ Approved by Governor  September 28, 2024.
civil enforcement;
Filed with Secretary of State  September 28, 2024.
public policy ands intent;
] LEGISLATIVE COUNSEL'S DIGESTSB 988, Wiener.
public awareness;
Freelance Worker Protection Act.Existing law generally regulates employment and, with certain exceptions, requires a 3-part test, commonly known as the “ABC” test, to determine if workers are employees or independent contractors for purposes of the Labor Code, the Unemployment Insurance Code, and the wage orders of the Industrial Welfare Commission.This bill would impose minimum requirements, commencing January 1, 2025, relating to contracts between a hiring party and a freelance worker, defined as a person, as specified, that is hired or retained as a bona fide independent contractor by a hiring party to provide professional services in exchange for an amount equal to or greater than $250, as specified.
reports;
Specifically, the bill would require a hiring party to pay a freelance worker the compensation specified by a contract for professional services on or before the date specified by the contract or, if the contract does not specify a date, no later than 30 days after completion of the freelance worker’s services.
coordination;
The bill would require a contract between a hiring party and a freelance worker to be in writing and would require a hiring party to retain the contract for no less than 4 years.
and rulemaking by the Department of Labor.
The bill would prohibit a hiring party from discriminating or taking adverse action against a freelance worker for taking specified actions relating to the enforcement of these provisions.
Effective July 1, 2024.
The bill would authorize an aggrieved freelance worker or a public prosecutor to bring a civil action to enforce these provisions, as specified.Digest Key Vote:
LRB103 30684 SPS 57150 b A BILL FOR SB2041 LRB103 30684 SPS 57150 b AN ACT concerning employment.
MAJORITY   Appropriation:
Be it enacted by the People of the State of Illinois, represented in the General Assembly:
NO   Fiscal Committee:
Section 1.
YES   Local Program:
Short title.
NO  Bill TextThe people of the State of California do enact as follows:SECTION 1. Part 5 (commencing with Section 18100) is added to Division 7 of the Business and Professions Code, to read:PART 5. Independent Contractors18100. This part shall be known, and may be cited, as the Freelance Worker Protection Act.18101. For purposes of this part, the following definitions apply:(a) “Freelance worker” means a person or organization composed of no more than one person, whether or not incorporated or employing a trade name, that is hired or retained as a bona fide independent contractor by a hiring party to provide professional services in exchange for an amount equal to or greater than two hundred and fifty dollars ($250), either by itself or when aggregated with all contracts for services between the same hiring party and independent contractor during the immediately preceding 120 days.(b) “Hiring party” means a person or organization in the State of California that retains a freelance worker to provide professional services, except any of the following:(1) The United States government.(2) The State of California or any subdivision thereof.(3) A foreign government.(4) An individual hiring services for the personal benefit of themselves, their family members, or their homestead.(c) “Professional services” has the same meaning as paragraph (2) of subdivision (b) of Section 2778 of the Labor Code.(d) “Public prosecutor” has the same meaning as Section 180 of the Labor Code.18102. (a) Except as otherwise provided by law, a hiring party shall pay a freelance worker the compensation specified by a contract for professional services:(1) On or before the date compensation is due pursuant to the contract.(2) If the contract does not specify when the hiring party shall pay, no later than 30 days after the completion of the freelance worker’s services under the contract.(b) Once a freelance worker has commenced performance of services under a contract, a hiring party shall not require as a condition of timely payment that the freelance worker do either of the following:(1) Accept less compensation than the amount of compensation specified by the contract.(2) Provide more goods or services or grant more intellectual property rights than agreed to in the contract.18103. (a) Whenever a hiring party retains the services of a freelance worker, the contract between the hiring party and the freelance worker shall be in writing.
This Act may be cited as the Freelance Worker Protection Act.
The hiring party shall furnish a signed copy of the written contract, either physically or electronically, to the freelance worker.
Section 5.
The hiring party shall retain the contract for no less than four years.(b) The contract shall include, at minimum, all of the following information:(1) The name and mailing address of each party.(2) An itemized list of all services to be provided by the freelance worker, including the value of those services and the rate and method of compensation.(3) The date on which the hiring party shall pay the contracted compensation or the mechanism by which the date shall be determined.(4) The date by which a freelance worker shall submit a list of services rendered under the contract to the hiring party to meet the hiring party’s internal processing deadlines for purposes of timely payment of compensation.(c) This section does not limit existing contract law, including, but not limited to, that it does not prevent a freelance worker from enforcing an oral contract or recovering under the doctrine of promissory estoppel.
Definitions.
Notwithstanding a refusal by the hiring party to provide a written contract as required by subdivision (a), the following may be evidence that a contract was formed between the parties:(1) The hiring party made representations to the freelance worker regarding the rate for services to be performed.(2) The freelance worker provided in writing any document to the hiring party, including email, text message, or other electronic communication, a summary of the rate and work to be performed prior to performing the work.(3) The freelance worker performed the work that the freelance worker understood was to be performed.18104. A waiver of any provision in this part shall be deemed contrary to public policy and is void and unenforceable.18105. A hiring party shall not discriminate or take any adverse action against a freelance worker that penalizes a freelance worker for, or is reasonably likely to deter a freelance worker from, taking any of the following actions:(a) Opposing any practice prohibited by this part.(b) Participating in proceedings related to the enforcement of this part.(c) Seeking to enforce rights provided by this part.(d) Otherwise asserting or attempting to assert rights provided by this part.18106. (a) An aggrieved freelance worker or a public prosecutor may bring a civil action to enforce this part.(b) A prevailing plaintiff in an action alleging a violation of this part is entitled to reasonable attorney’s fees and costs, injunctive relief, and any other remedies deemed appropriate by the court.
As used in this Act:
Damages shall be awarded to an aggrieved freelance worker as follows:(1) If the freelance worker requested a written contact prior to commencing work under the contract and the hiring party refused in violation of Section 18103, the freelance worker shall be awarded an additional one thousand dollars ($1,000).(2) If the hiring party failed to pay the freelance worker the contracted compensation by the time required under Section 18102, the freelance worker shall be awarded damages up to twice the amount that remained unpaid at the time payment was due.
"Department" means the Department of Labor.
If the freelance worker requested a written contract prior to commencing work under the contract and the hiring party refused in violation of Section 18103, the amount unpaid shall be determined by the rate the freelance worker reasonably understood to apply to the work.(3) If the hiring party violates any other provision of this part, the freelance worker may be awarded damages equal to the value of the contract or the work performed, whichever is greater.18107. This part applies only to contracts entered into or renewed on or after January 1, 2025.
"Director" means the Director of Labor, or his or her designee.
"Freelance worker" means a natural person who is hired or retained as an independent contractor by a hiring party to provide products or services in Illinois or for a hiring party located in Illinois in exchange for an amount equal to or greater than $500, either by itself or when aggregated with all contracts for products or services between the same hiring party and the freelance worker during the immediately preceding 120 days.
"Freelance worker" does not include an individual performing services as an employee under Section 10 of the Employee Classification Act or an employee as defined in Section 2 of the Wage Payment and Collection Act.
"Hiring party" means any person who retains a freelance worker to provide any service, other than:
(1) the United States government;
SB2041 - 2 - LRB103 30684 SPS 57150 b (2) the State of Illinois;
(3) a unit of local government;
or (4) any foreign government.
"Natural person" means an individual human being.
"Person" means any natural person, individual, corporation, business enterprise or other legal entity, either public or private, and any legal successor, representative, agent or agency of that individual, corporation, business enterprise, or legal entity.
Section 10.
Payment of compensation for freelance workers.
(a) Except as otherwise provided by law, a freelance worker shall be paid the contracted compensation amount no later than 30 days after the freelance worker provides the product or completes the services under the contract.
(b) Once a freelance worker has commenced preparation of the product or performance of the services under the contract, the hiring party shall not require as a condition of timely payment that the freelance worker accept less compensation than the amount of the contracted compensation.
Section 15.
Contract for products and services of freelance workers.
(a) Whenever a hiring party retains a freelance worker, the contract for such products or services shall be reduced to writing and signed by the freelance worker and the hiring SB2041 - 3 - LRB103 30684 SPS 57150 b party.
Show all 127 changed rows (87 more)
Previous
Latest
The hiring party shall furnish a copy of the written contract, either physically or electronically, to the freelance worker and each party to the written contract shall retain a copy thereof.
(b) The written contract for the product and service of a freelance worker shall include, at a minimum, the following information:
(1) the name and mailing address of both the hiring party and the freelance worker;
(2) an itemization of all products and services to be provided by the freelance worker, the value of the products and services to be provided under the terms of the contract, and the rate and method of compensation;
(3) the date on which the hiring party must pay the contracted compensation or the mechanism by which such date will be determined;
and (4) the date by which a freelance worker must submit a list of products or services rendered under such contract to the hiring party in order to meet any internal processing deadlines of the hiring party for the purposes of compensation being timely render by the agreed-upon date as stipulated in paragraph (3).
(c) The Department may adopt rules as necessary to enforce this Act, including, but not limited to, requiring additional terms to ensure that the freelance worker and the hiring party understand their obligations under the contract.
SB2041 - 4 - LRB103 30684 SPS 57150 b (d) The hiring party shall retain the contract for the service of a freelance worker for no less than 6 years and shall make such contract available to the Department upon request.
The failure of the hiring party to produce such contract within 5 business days upon the request of the Department shall give rise to a presumption that the terms the freelance worker has presented are the agreed upon terms.
(e) The Department shall make available model contracts on its website for use by the general public at no cost.
Such model contracts shall be made available in English and in the 8 languages most commonly spoken by limited English proficient individuals in the State.
Section 20.
Nondiscrimination.
No hiring party shall threaten, intimidate, discipline, harass, deny a freelance opportunity to, or take any other action that penalizes a freelance worker for, or is reasonably likely to deter a freelance worker from, exercising or attempting to exercise any right guaranteed by this Act, or from obtaining any future work opportunity because the freelance worker has done so.
Section 25.
Enforcement.
(a) It shall be the duty of the Department to inquire diligently for any violations of this Act, and to institute the actions for penalties provided by this Act, and to enforce generally the provisions of this Act.
SB2041 - 5 - LRB103 30684 SPS 57150 b (b) A freelance worker may file a complaint with the Department alleging violations of the Act by submitting a signed, completed compensation claim application on the form provided by the Department and by submitting copies of all supporting documentation.
The form provided by the Department shall include requests for information to facilitate its report making requirements under Section 50, including, (1) the general sector or occupation of the freelance worker submitting a claim under this Act, (2) the county where the work by the freelance worker was performed, and (3) the demographic data of the freelance worker submitting a claim under this Act, to be provided by the freelance worker on a voluntary basis.
Complaints alleging violation of Section 15 shall be filed within 2 years after the date the final compensation was due.
Complaints alleging violation of Section 10 shall be filed within 3 years after the date the final compensation was due.
Applications shall be reviewed by the Department to determine whether there is cause for investigation.
Failure of a hiring party to keep adequate records or provide written contract as required by this Act shall not operate as a bar to a freelance worker filing a complaint.
The Department shall keep the names of freelance workers who are the subject of an investigation confidential until such time that disclosure is necessary for resolution of an investigation or complaint.
(c) Each freelance worker who files a completed SB2041 - 6 - LRB103 30684 SPS 57150 b compensation claim application alleging a violation of this Act or a rule adopted thereunder shall be provided with a written description of the anticipated processing of the complaint, including investigation, case conference, potential civil and criminal penalties, and collection procedures.
Each freelance worker and his or her authorized representative shall be notified in writing of any case conference before it is held and given the opportunity to attend.
Each freelance worker and his or her authorized representative shall be notified in writing of any award and collection of civil penalties.
(d) The Department shall have the power to investigate and attempt equitably to adjust controversies between freelance workers and hiring entities in respect of compensation claims arising under this Act and to that end the Department through the Director or any other person in the Department designated by him or her, shall have the power to administer oaths, subpoena and examine witnesses, to issue subpoenas duces tecum requiring the production of such books, papers, records and documents as may be evidence of any matter under inquiry and to examine and inspect the same as may relate to the question in dispute.
Service of such subpoenas shall be made by any sheriff or any person.
Any court in this State, upon the application of the Department may compel attendance of witnesses, the production of books and papers, and the giving of testimony before the Department by attachment for contempt SB2041 - 7 - LRB103 30684 SPS 57150 b or in any other way as the production of evidence may be compelled before such court.
The Department may initiate a mediation conference.
(e) Where reasonable cause exists to believe that a hiring party is engaged in a pattern or practice of violations of this Act, the Attorney General may commence a civil action on behalf of the State in a court of competent jurisdiction.
The Attorney General may receive injunctive relief, civil penalties, and any other relief deemed appropriate by the court.
(f) Nothing in this Act shall be construed to prevent any freelance worker from making complaint or prosecuting his or her own claim for compensation.
Any freelance worker aggrieved by a violation of this Act or any rule adopted under this Act may file suit in circuit court of Illinois, in the county where the alleged violation occurred or where any freelance worker who is party to the action resides, without regard to exhaustion of any alternative administrative remedies provided in this Act.
Actions may be brought by one or more freelance workers for and on behalf of themselves and other freelance workers similarly situated.
(g) Nothing in this Act shall be construed to limit the authority of the State's attorney of any county to prosecute actions for violation of this Act or to enforce the provisions thereof independently and without specific direction of the Department.
SB2041 - 8 - LRB103 30684 SPS 57150 b Section 30.
Civil enforcement.
(a) Any freelance worker not timely paid final compensation by a hiring party as required by Section 10 shall be entitled to recover through a claim filed with the Department or in a civil action, but not both, double the amount of any such underpayments, injunctive relief, and other such remedies as may be appropriate.
In a civil action for violation of Section 10, such freelance worker shall also recover costs and all reasonable attorney's fees.
Civil complaints alleging violation of Section 10 shall be filed within 3 years after the date the final compensation was due.
(b) Any freelance worker who was retained in violation of Section 15 despite the freelance worker's request for a written contract prior to commencing the contracted work as required by Section 15 shall be entitled to recover through a claim filed with the Department or in a civil action, but not both, statutory damages of $500.
However, a freelance worker who prevails on a claim alleging violation of Section 15 and on one or more claims under other Sections shall be awarded statutory damages equal to the value of the underlying contract or $500, whichever is greater, in addition to the other remedies provided.
Civil complaints alleging violation of Section 15 shall be filed within 2 year after the date the final compensation was due.
(c) Any freelance worker who is threatened, intimidated, SB2041 - 9 - LRB103 30684 SPS 57150 b disciplined, harassed, denied a freelance opportunity, or penalized by a hiring party in violation of Section 20 of this Act shall be entitled to recover through a claim filed with the Department or in a civil action, but not both, statutory damages equal to the value of the underlying contract for each violation of Section 20.
In a civil action for violation of Section 20, such freelance worker shall also recover costs and all reasonable attorney's fees.
Section 35.
Criminal penalties.
In addition to the other remedies provided in this Act, any hiring party or any agent of a hiring party, who, being able to pay final compensation and being under a duty to pay, wilfully refuses to pay as provided in this Act, or falsely denies the amount or validity thereof or that the same is due, with intent to secure for the hiring party or other person any underpayment of such indebtedness or with intent to annoy, harass, oppress, hinder, delay, or defraud the freelance worker to whom such indebtedness is due, upon conviction, is guilty of:
(1) for unpaid final compensation in the amount of $5,000 or less, a Class B misdemeanor;
or (2) for unpaid final compensation in the amount of more than $5,000, a Class A misdemeanor.
Each day during which any violation of this Act continues shall constitute a separate and distinct offense.
Any hiring party or any agent of a hiring party who SB2041 - 10 - LRB103 30684 SPS 57150 b violates this Act a subsequent time within 2 years of a prior criminal conviction under this Section is guilty, upon conviction, of a Class 4 felony.
Section 40.
Public policy and intent.
(a) Except as otherwise provided by law, any provision of a contract purporting to waive rights under this Act is void as against public policy.
(b) The provisions of this Act are intended to supplement, and do not diminish or replace, any other basis of liability, remedy, or requirement established by statute or common law.
(c) Failure to comply with this Section does not render any contract between a hiring party and a freelance worker void in total, voidable, or otherwise impair any obligation, claim, or right related to the contract, nor does it constitute a defense to any action or proceeding to enforce, or for breach of, such contract.
(d) No provision of this Act relating to freelance workers shall be construed as providing a determination about the legal classification of any such worker as an employee or independent contractor.
Section 45.
Public awareness.
Subject to appropriation, the Department may conduct a public awareness campaign, that shall include making information available on its website, otherwise informing hiring parties of the provisions of this SB2041 - 11 - LRB103 30684 SPS 57150 b Act, and establishing a means for assistance by a natural person through phone or email.
Section 50.
Reports.
One year after the effective date of this Act, and by November 1 every 5 years thereafter, the Department shall submit to the General Assembly and publish on its website a report regarding the effectiveness of this Act at improving freelance contracting and payment practices.
The report shall include, but is not limited to:
(1) the number of complaints received;
(2) the value of the contracts disaggregated into ranges of $500 and by the Section of this Act the associated hiring party is alleged to have violated;
(3) the numbers of responses and non-responses received by the Department disaggregated by contract value into ranges of $500 and by the Section of this Act the associated hiring party is alleged to have violated;
(d) the number of freelance workers that pursue their claims of violation of this Act through civil action or an alternative dispute resolution process, and a summary of the outcomes, if known;
(4) the general sector or occupation of the freelance workers submitting claims pursuant to this Act;
(5) the counties where violations of this Act are alleged to have occurred, including the number of violations from each county;
SB2041 - 12 - LRB103 30684 SPS 57150 b (6) to the extent available, demographic data of the freelance workers who allege violations of this Act;
and (7) legislative recommendations, including consideration of whether certain occupations should be exempted from the scope of the definition of freelance worker.
Section 55.
Coordination.
(a) The Department is authorized to coordinate enforcement efforts with other agencies and combine claims under this Act with claims under other Acts.
(b) The Department is authorized to enter into agreements with other states to collect unpaid compensation from out-of-state hiring entities and to perform reciprocal services for such states in the State of Illinois.
Section 60.
Rulemaking.
The Director, or his authorized representatives, shall administer and enforce the provisions of this Act.
In order to accomplish the objectives of this Act and to carry out the duties prescribed by this Act, the Director, or his authorized representative, shall adopt rules necessary to administer and enforce the provisions of this Act, including the procedures that shall be followed for hearings under Section 25.
The adoption, amendment, or rescission of rules shall be in conformity with the requirements of the Illinois Administrative Procedure Act.
SB2041 - 13 - LRB103 30684 SPS 57150 b Section 99.
Effective date.
This Act takes effect July 1, 2024.