On January 1, 2025, the Freelance Worker Protection Act (“FWPA”) went into effect in California (Business & Professions Code 18100 et seq.). While the terms “independent contractor” and “freelancer” may be interchanged in common day language, under California law, “freelance worker” has a specific and narrow definition as compared to independent contractor. If your business or your organization uses freelance workers, here is important information to understand.
Who Is a Freelance Worker?
The FWPA defines a freelance worker as a person (or organization composed of no more than one person) who is hired to provide professional services for an amount of $250.00 or more (either from a single contract or when aggregating all contracts between the parties during the preceding 120 days). Professional services has the same meaning as that under AB 5 (California’s independent contractor law) and include:
- Marketing
- Human Resources Administration
- Travel Agent Services
- Graphic Designer
- Grant Writer
- Fine Artist
- Payment Processing
- Photography/Videography/Photo Editing
- Writer/Translator/Editor/Illustrator
- Licensed Esthetician/Electrologist/Manicurist/Barber/Cosmetologist
- Specialized performer hired by a performing arts company to teach a week-long or less master class
- Appraiser
- Licensed Professional Forester
The FWPA defines a person or entity that uses a freelance worker to provide professional services as a hiring party. Excluded from the definition of “hiring party,” are the U.S. government, the State of California, a foreign government, or an individual hiring services “for the personal benefit of themselves, their family members, or their homestead.”
Contracting with Freelance Workers:
While both AB 5 and the FWPA require written agreements, the FWPA requires additional elements for freelance workers. The contract must contain, at minimum:
- the name and address of each party,
- an itemized list of the services the freelance worker is to provide and their value,
- a date (or mechanism to determine a date) of when the hiring party will pay, and
- a date by which the freelance worker will submit a list of services that were completed to meet the hiring party’s internal deadlines for timely payment of compensation.
Timely Compensation for Freelance Workers:
The FWPA requires that the hiring party pay freelance workers on or before the date compensation is due per the contract with the freelance worker. If the contract does not specify a time, freelance workers must be paid no later than 30 days after they complete their services.
The hiring party may not condition timely payment upon the freelance worker getting paid less than the amount specified by the contract, or to provide more services than those specified by the contract. Thus, organizations must pay freelance workers on time and stick to what they agreed to in their contract.
Civil Actions & Damages:
A freelance worker or public prosecutor may bring a civil action against a hiring party to enforce the provisions in the FWPA. If successful, a freelance worker is entitled to reasonable attorneys’ fees and costs. If a freelance worker requested a written contract as per the FWPA and the hiring party refused, the hiring party has to pay a fee of $1,000. In addition, if the hiring party failed to pay the freelance worker the contracted compensation on time as required by the FWPA, the hiring party will have to pay the freelance worker damages up to twice the amount that remained unpaid at the time payment was due. If a hiring party violates the FWPA, the freelance worker can be awarded damages equal to the value of the contract or the value of the work performed, whichever is greater.
Anyone with questions about the FWPA, or independent contractors, may contact the authors of this post or their usual employment law counsel at AALRR.
This AALRR publication is intended for informational purposes only and should not be relied upon in reaching a conclusion in a particular area of law. Applicability of the legal principles discussed may differ substantially in individual situations. Receipt of this or any other AALRR publication does not create an attorney-client relationship. The Firm is not responsible for inadvertent errors that may occur in the publishing process.
© 2025 Atkinson, Andelson, Loya, Ruud & Romo
Source: What Employers Need to Know About the Freelance Protection Act
