California has gone to great lengths to limit independent contractor relationships and recently, the City of Los Angeles, created additional hurdles to the hiring and use of independent contractors or freelance workers. The Los Angeles Freelance Worker Protections Ordinance, effective July 1, 2023, imposes new requirements on businesses that work with independent contractors within the City of Los Angeles. Employers and businesses in Los Angeles must now follow these new requirements when using independent contractors or risk being penalized for violation of the provisions of the new ordinance which provides for monetary penalties and damages under a newly created private cause of action.
The Ordinance claims that is attempting to protect independent contractors against delayed, non- and underpayment.
Who Does The Ordinance Apply To?
With few exceptions, any entity doing business in Los Angeles and or that hires an independent contractor to provide services within the City of Los Angeles is covered if the value of the services provided within the City limits exceeds $600 in one calendar year.
A “freelance worker” or independent contractor is a person, or entity whose work is performed entirely by no more than one individual natural person, engaged to perform services for the hiring entity in exchange for compensation.
Exceptions
The Ordinance does not apply to the hiring of app-based transportation and delivery drivers such as ridesharing companies like Uber.
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