On July 1, 2023, the City of Los Angeles Freelance Worker Protections Ordinance went into effect. The ordinance sets forth certain requirements for hiring entities retaining freelance workers operating within the City of Los Angeles.

Definition of Freelance Worker

Under the ordinance, a freelance worker is defined as an individual or entity composed of no more than one person that is hired by a “Hiring Entity” as a bona fide independent contractor to provide services in exchange for compensation. Under the definition, a freelance worker is an individual or entity with no employees.  

Definition of Hiring Entity

Under the ordinance, a hiring entity is defined as being regularly engaged in a business or commercial activity but does not include entities that hire app-based drivers to provide prearranged transportation or delivery services.

Covered Work

The protections under the ordinance apply to work performed by a freelance worker after July 1, 2023, in the City of Los Angeles and valued at $600 or more either by an individual job or cumulative jobs in a calendar year.

Requirements of the Ordinance and Protections Provided

• Hiring entities are required to provide the freelance workers with a written contract for all agreements valued at $600 or more. In addition to information regarding the hiring entity and the freelance worker, the contracts must include both (i) an itemization of all services to be provided by the freelance worker, the value of the services to be provided pursuant to the contract, and the rate and method of compensation; and

• (ii) the date by which the hiring entity must pay for the contracted compensation or the manner by which such date will be determined.

• The hiring entity is required to provide full payment by the date specified in the contract, or no later than 30 days after work is completed if no date is specified in the contract.

• Both the hiring entity and freelance worker must retain records for 4 years.

• The hiring entity may not retaliate against any freelance worker for exercising their rights under the ordinance.

• The ordinance provides for additional damages and remedies available to the freelance worker where the hiring entity fails to respond to a freelance worker’s request for a written contract prior to commencing work, fails to pay amounts agreed to under the contract, or violates any other provisions of the ordinance.