Update Applicable to:
All natural persons or entities in Illinois that hire a natural person to provide products or services in exchange for an amount of at least $500.
On August 4, 2023, the Illinois Governor signed the Freelance Worker Protection Act that mandates that the contracting party provide a written contract and specific administrative and judicial relief, becoming the law effective on July 1, 2024.
What are the details?
A freelance worker is someone engaged to provide services or products in Illinois or for a company located within the State as an independent contractor, and the amount paid to the person must be at least $500. The law excludes people retained by construction contractors or subcontractors and employees as defined under State law.
The law protects independent contractors by mandating that the contracting party provide a written contract, that there are specific administrative and judicial relief, forbids the hiring entity from changing/reducing the agreed-upon compensation in exchange for the timely payment of that money and prohibits any action designed to penalize the contractor or prevent him from pursuing his rights under the law, such as threats, harassment, or retaliation. There is a two-year statute of limitations, and the IDOL must provide a sample contract on its webpage free of charge.
- Employers should review the Freelance Worker Protection Act.
- Employers should determine whether the actual contractors fall under the protections established by the Act and review or create any policy needed to comply properly with the new requirements of the law.
Employers should review additional resources here:
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