5 States, Cities Are Now Regulating Freelance Work in the US—Here’s What You Need to Know

Freelance work is getting some official attention. Several states and local governments in the U.S. have introduced new rules to better protect freelancers, ensuring clearer contracts, faster payments, and safeguards against unfair treatment. But not everyone is thrilled—some worry these regulations might make businesses think twice about hiring freelancers. Here’s a look at what’s happening across the country, what the new rules involve, and how they could impact both freelancers and the businesses that hire them.

1. Illinois: Statewide Freelance Protection Law

Illinois now requires written contracts for freelance jobs worth $500 or more in a 120 day period. This law went into effect mid 2024.

Now, payments must be made within 30 days of finishing the work, and businesses can’t reduce pay in exchange for faster payments. 

However, not every industry is covered—construction, for example, is exempt. And businesses need to keep those contracts on file for at least two years.

2. New York: The Freelance Isn’t Free Act

New York’s “Freelance Isn’t Free” Act first took effect in New York City in 2017 but expanded statewide in 2023. The law requires written contracts for all gigs valued at $800 or more during a 120 period and ensures freelancers get paid within 30 days. If payments are missed or freelancers are mistreated, they have the right to take legal action.

New York’s law also offers some serious muscle—freelancers can recover double the amount they’re owed, plus attorney fees. So far, it’s helped recover millions in unpaid wages for workers across the state.

3. California: Freelance Worker Protection Act (FWPA)

California recently joined the club by passing the Freelance Worker Protection Act in September 2024. The law, which goes live on January 1, 2025, mandates written contracts for projects worth $250 or more. These contracts need to include all the key details—like the type of work, payment terms, and deadlines.

Payments have to be made by the agreed date or, if no specific date is set, within 30 days. And just like Illinois, California prohibits retaliation against freelancers who report unfair practices. Companies are required to keep these contracts for four years.

4. Los Angeles: Freelance Worker Protections Ordinance

Los Angeles has had its own freelance protections in place since July 2021. The city requires written agreements for freelance work totaling more than $600 per year. Payments must be made within 30 days, and if freelancers aren’t paid, they can file a complaint with the Office of Wage Standards. Both parties must retain records for four years.

5. Columbus, Ohio: Freelance Worker Protection Ordinance

Columbus jumped on board with a similar law in May 2023. It mandates written contracts for work worth $250 or more over a four-month period and requires payments within 30 days. The ordinance also shields freelancers from retaliation and gives them a way to report issues through the city’s Wage Theft Prevention and Enforcement Commission.

The Pros of Freelance Protection Laws

These new rules aim to make freelancing more secure. Here are a few benefits:

• Timely Payments: Freelancers no longer have to chase down late payments—these laws ensure they get paid on time.
• Clear Contracts: Upfront agreements help avoid misunderstandings, spelling out project details and payment terms.
• Protection from Retaliation: Freelancers can speak up about issues without fear of losing future work.

The Cons of Freelance Protection Laws

However, not everyone is convinced these laws will be smooth sailing. Some freelancers and businesses have raised concerns, including:

• Fewer Opportunities: Some companies might avoid hiring freelancers altogether to sidestep the new paperwork and rules.
• Less Flexibility: Strict contracts could make it harder to change terms mid-project, which can strain client relationships.
• Reduced Independence: Many freelancers enjoy running things their own way and worry that too much regulation could complicate that freedom.

What’s Next for Freelancers?

These laws aim to strike a balance between protecting freelancers and maintaining flexibility. As more states follow suit, freelancers will need to keep an eye on how these changes evolve. Will they offer the security and fairness freelancers deserve, or will they create new challenges in the way freelancers and businesses collaborate?

What’s your take? Do you think these laws will help or hurt freelancers in the long run? Let us know in the comments!