SB 988 – The Freelance Worker Protection Act

Senate Bill 988 (SB 988) creates the Freelance Worker Protection Act (FWPA), is intended to provide certain protections to freelance workers and establish certain minimum requirements for contracts between hiring parties and freelance workers.

Under SB 988, a freelance worker is a person or organization composed of no more than one person (whether or not incorporated or using a trade name) hired as a bona fide independent contractor to provide “professional services” valued at $250 or more, either for one project or in aggregate for a series of projects over the preceding 120 days.

SB 988 uses the same definition for “professional services” as that term is defined in Labor Code section 2778, which includes but not limited to, marketing, administrators of human resources, graphic design, grant writers, graphic design, fine artists, photographers, photojournalists, writers, or content contributors for publications such as educational, academic, or instructional works.

A hiring party is a person or organization in California that retains a freelance worker to provide professional services, except the United States government, the State of California or any subdivision thereof, a foreign government, or an individual hiring for services for the personal benefit of themselves, their family, or their home.

Written Contract Requirements

Beginning January 1, 2025, SB 988 requires that contracts between hiring parties and freelance workers be in writing and include, at a minimum, the following information:

• Each party’s name and address;
• An itemized list of services, their value, and the rate and method of compensation;
• The payment date or the mechanism by which the parties will determine the date;
• The date the services must be rendered to meet the hiring party’s internal processing deadlines for purposes of timely payment of compensation.

The hiring party must provide the contract to the freelance worker and retain the contract for at least four years.

SB 988 makes clear, however, that even if a written contract does not exist, freelance workers retain the right to enforce oral contracts or recover under the doctrine of promissory estoppel. A waiver of any provision of the Act shall be deemed contrary to public policy and is void and unenforceable.

Payment Provisions

SB 988 requires hiring parties to pay freelance workers according to the contract terms or, if the contract does not specify a date despite SB 988’s requirement that it does, payment must be made within 30 days after the services are completed. Once work has commenced, hiring parties cannot require freelancers to accept less compensation or provide more services than agreed upon as a condition for timely payment

Anti-Discrimination and Retaliation Protections

SB 988 also prohibits a hiring party from discriminating or taking adverse action against a freelance worker for:

• Opposing any practice prohibited by the FWPA;
• Participating in proceedings related to the enforcement of the FWPA;
• Seeking to enforce rights provided by the FWPA, or otherwise asserting or attempting to assert rights provided in the FWPA.

SB 988 also allows an aggrieved freelance worker or a public prosecutor to bring a civil action to enforce the provisions of the FWPA. A plaintiff that prevails in an action alleging a violation of the FWPA is entitled to reasonable attorney’s fees and costs, injunctive relief, and any other remedies deemed appropriate by the court. FWPA also provides for damages and penalties. For example, an aggrieved employee can be awarded:

1. $1,000 if the freelance worker requested a written contact prior to commencing work and the firing party failed to provide one;
2. Damages up to twice the amount that remained unpaid at the time payment was due, if the hiring party failed to timely pay the freelance worker as required by the contract, the worker must be awarded damages up to twice the amount that remained unpaid at the time payment was due; and
3. An award of damages equal to the value of the contract or the work performed whichever is greater, if the hiring part violated any other provisions of the FWPA.

(SB 988 adds add Part 5 (commencing with section 18100) to Division 7 of the Business and Professions Code)