Full Text of HB1122 103rd General Assembly
HB1122 103RD GENERAL ASSEMBLY |
| | 103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024 HB1122 Introduced 1/12/2023, by Rep. Will Guzzardi SYNOPSIS AS INTRODUCED: |
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Creates the Freelance Worker Protection Act. Provides that freelance workers must be compensated by hiring parties for their services in a timely manner. Provides that whenever a hiring party retains the services of a freelance
worker, the contract between
the hiring party and the freelance worker shall be reduced to writing. Provides that no hiring party shall threaten,
intimidate, discipline, harass, deny a work opportunity to, or discriminate against a freelance worker, or take any other action that penalizes a freelance worker for, or is reasonably likely to deter a freelance worker from, exercising or attempting to exercise any right
guaranteed under the Act. Contains provisions concerning complaints to the Director of Labor; the powers and duties of the Director; civil actions brought by freelance workers; civil actions brought by the State; the scope of freelance worker contracts; a public awareness campaign; and surveys, information collection, and reporting requirements. Effective immediately.
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| | A BILL FOR |
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| 1 | | AN ACT concerning employment.
| 2 | | Be it enacted by the People of the State of Illinois,
| 3 | | represented in the General Assembly:
| 4 | | Section 1. Short title. This Act may be cited as the | 5 | | Freelance Worker Protection Act. | 6 | | Section 5. Definitions. As used in this Act: | 7 | | "Construction contractor" means any person, sole | 8 | | proprietor, partnership, firm, corporation, limited liability | 9 | | company, association, or other legal entity that by itself or | 10 | | through others offers to undertake, holds itself out as being | 11 | | able to undertake, or does undertake a construction project. | 12 | | "Construction project" means the providing of any labor or | 13 | | services, and the use of any materials or equipment in order to | 14 | | alter, build, excavate, add to, subtract from, improve, | 15 | | repair, maintain, renovate, move, wreck, or demolish any | 16 | | bridge, building, highway, road, railroad, land, tunnel, | 17 | | sewer, drainage, or other structure, project, development, or | 18 | | improvement, or the doing of any part thereof, including the | 19 | | erection of scaffolding or other structures or works in | 20 | | connection with the construction project.
| 21 | | "Department" means the Department of Labor. | 22 | | "Director" means the Director of Labor, or his or her | 23 | | designee. |
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| 1 | | "Freelance worker" means any person or organization
| 2 | | composed of no more than one person, whether or not | 3 | | incorporated
or employing a trade name, that is hired or | 4 | | retained as an independent
contractor by a hiring party to | 5 | | provide services in exchange for an amount equal to or greater | 6 | | than $250, either by itself
or when aggregated with all | 7 | | contracts for services between the same
hiring party and | 8 | | freelance worker during the immediately preceding 120 days. | 9 | | "Freelance worker" does not include: | 10 | | (1) any person who is a sales
representative under the | 11 | | terms of the contract at issue; | 12 | | (2) any person engaged in the practice of law under | 13 | | the terms of the
contract at issue and who is a member in | 14 | | good standing of the bar of the
highest court of any state, | 15 | | district, or territory and who is not under any order of | 16 | | court suspending,
enjoining, restraining, disbarring, or | 17 | | otherwise restricting such person
in the practices of law; | 18 | | (3) any person who is a licensed medical professional; | 19 | | or | 20 | | (4) any person who is a construction contractor. | 21 | | "Hiring party" means any person who retains a freelance | 22 | | worker to
provide any service, other than: | 23 | | (1) the United States government; | 24 | | (2) the State of Illinois, including any office, | 25 | | Department, agency,
or other body of the State, including | 26 | | the General Assembly and the
judiciary; |
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| 1 | | (3) a municipality, including any office, Department, | 2 | | agency, or
other body of a municipality; or | 3 | | (4) any foreign government. | 4 | | Section 10. Guarantee of compensation to freelance | 5 | | workers. | 6 | | (a) Except as otherwise provided by law, the contracted | 7 | | compensation shall be paid to a freelance worker either: | 8 | | (1) on or before the date such compensation is due | 9 | | under the terms of
the contract; or | 10 | | (2) if the contract does not specify when the hiring | 11 | | party must pay
the contracted compensation or the | 12 | | mechanism by which the date will be
determined, no later | 13 | | than 30 days after the completion of the freelance | 14 | | worker's services under the contract. | 15 | | (b) Once a freelance worker has commenced performance of | 16 | | the services
under the contract, the hiring party shall not | 17 | | require as a condition of
timely payment that the freelance | 18 | | worker accept less compensation than
the amount of the | 19 | | contracted compensation. | 20 | | Section 15. Required contracts between hiring parties and | 21 | | freelance workers. | 22 | | (a) Whenever a hiring party retains the services of a | 23 | | freelance
worker, the contract between
the hiring party and | 24 | | the freelance worker shall be reduced to writing. The hiring |
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| 1 | | party must
furnish a copy of the written contract, either | 2 | | physically or electronically, to the freelance worker and each | 3 | | party to the written contract
shall retain a copy. | 4 | | (b) The written contract shall include, at a minimum, the | 5 | | following
information: | 6 | | (1) the name and mailing address of both the hiring | 7 | | party and the
freelance worker; | 8 | | (2) an itemization of all services to be provided by | 9 | | the freelance
worker, the value of the services to be | 10 | | provided under the terms of the
contract, and the rate and | 11 | | method of compensation; | 12 | | (3) the date on which the hiring party must pay the | 13 | | contracted
compensation or the mechanism by which the date | 14 | | will be determined; and | 15 | | (4) the date by which a freelance worker must submit a | 16 | | list of
services rendered under the contract to the hiring | 17 | | party in order to
meet any internal processing deadlines | 18 | | of the hiring party for the
purposes of compensation being | 19 | | timely rendered by the agreed-upon date
as described in | 20 | | paragraph (3). | 21 | | (c) The Department may adopt rules requiring additional | 22 | | terms to a written contract to ensure
that the freelance | 23 | | worker and the hiring party understand their obligations under | 24 | | the written contract. | 25 | | (d) The hiring party shall be required to keep the written | 26 | | contract for a
period of no less than 6 years and shall make |
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| 1 | | the contract available
to the Director upon request. The | 2 | | failure of a hiring party to
produce a contract upon request of | 3 | | the Director shall give rise
to a presumption that the terms | 4 | | that the freelance worker has presented
are the agreed upon | 5 | | terms. | 6 | | (e) The Director shall make available model contracts on | 7 | | the Department's
website for use by the general public at no | 8 | | cost. The
model contracts shall be made available in English, | 9 | | Spanish, and the next 4 most commonly used languages in the | 10 | | State. | 11 | | Section 20. Prohibition on coercive acts by hiring | 12 | | parties. No hiring party shall threaten,
intimidate, | 13 | | discipline, harass, deny a work opportunity to, or | 14 | | discriminate against a freelance worker, or take any other | 15 | | action that penalizes a freelance worker for, or is reasonably | 16 | | likely to deter a freelance worker from, exercising or | 17 | | attempting to exercise any right
guaranteed under this Act, or | 18 | | from obtaining any future work opportunity because the | 19 | | freelance worker has exercised or attempted to exercise any | 20 | | right
guaranteed under this Act. | 21 | | Section 25. Complaints. | 22 | | (a) Any freelance worker or his or her authorized | 23 | | representative
may file with the Director a complaint claiming | 24 | | a violation of this
Act and the Director shall investigate the |
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| 1 | | complaint. The Director shall keep the names of
freelance | 2 | | workers who are the subject of an investigation confidential
| 3 | | until the time that disclosure is necessary for the resolution | 4 | | of the complaint. Failure of a hiring party to keep adequate
| 5 | | records or provide a written contract as required under this | 6 | | Act, in
addition to exposing the hiring party to penalties | 7 | | authorized under
this Act, shall not operate as a bar to the | 8 | | filing of a complaint by a
freelance worker. If the hiring | 9 | | party fails to keep accurate records in violation of this Act, | 10 | | the hiring party shall
bear the burden of proving that the | 11 | | complaining freelance worker was paid in
accordance with this | 12 | | Act. | 13 | | (b) Each freelance worker who files a complaint regarding | 14 | | a violation
of this Act or a rule or regulation adopted in | 15 | | accordance with this Act, shall
be provided with a written | 16 | | description of the anticipated processing of the complaint, | 17 | | including investigation, case conference,
potential civil and | 18 | | criminal penalties, and collection procedures. | 19 | | (c) Each freelance worker and his or her authorized | 20 | | representative
shall be notified in writing of any case | 21 | | conference before it is held
and given the opportunity to | 22 | | attend. | 23 | | (d) Each freelance worker and his or her authorized | 24 | | representative
shall be notified in writing of any award and | 25 | | collection of civil
penalties. |
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| 1 | | Section 30. Powers and duties of the Director. | 2 | | (a) The Director shall have the following powers and
| 3 | | duties: | 4 | | (1) The Director shall investigate and attempt to | 5 | | adjust equitably
controversies between freelance workers | 6 | | and hiring parties relating to
the provisions of this Act. | 7 | | (2) The Director may take assignments of claims for | 8 | | wages under
this Act from freelance workers or third | 9 | | parties in trust for such
freelance workers or for the | 10 | | benefit of various funds for such freelance
workers. All | 11 | | such assignments shall run to the Director and his or her | 12 | | successor in office. The Director may sue hiring parties | 13 | | on wage
claims assigned to it, with the benefits and | 14 | | subject to the provisions of existing law applying to | 15 | | actions by freelance workers for the collection of
wages. | 16 | | The Director may join in a single action any number of wage | 17 | | claims
against the same hiring party. | 18 | | (b)(1) The Director is authorized and empowered to enter
| 19 | | into reciprocal agreements with the labor department or | 20 | | corresponding
agency of any other state or with the person, | 21 | | board, officer, or commission authorized to act on behalf of | 22 | | the department or agency, for
the collection in the other | 23 | | state of claims and judgments for wages
based upon claims | 24 | | assigned to the Director. | 25 | | (2) The Director may, to the extent provided for by any | 26 | | reciprocal agreement entered into by law or with any agency of |
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| 1 | | another state
as provided in paragraph (1), maintain actions | 2 | | in the courts of the other state
for the collection of claims | 3 | | and judgments for wages and may assign the
claims and | 4 | | judgments to the labor department or agency of the other
state | 5 | | for collection to the extent that an assignment may be
| 6 | | permitted or provided for by the law of the other state or by | 7 | | reciprocal
agreement. | 8 | | (3) The Director may, upon the written consent of the | 9 | | labor
department or other corresponding agency of any other | 10 | | state or of
any person, board, officer, or commission of the | 11 | | state authorized to
act on behalf of the labor department or | 12 | | corresponding agency,
maintain actions in the courts of this | 13 | | State upon assigned claims and
judgments for wages arising in | 14 | | the other state in the same manner
and to the same extent that | 15 | | the actions by the Director are
authorized when arising in | 16 | | this State. Actions may be
maintained only in cases where the | 17 | | other state by law or reciprocal
agreement extends a like | 18 | | comity to cases arising in this State. | 19 | | (c) Nothing in this Section shall be construed as | 20 | | requiring
the Director in every instance to investigate and | 21 | | attempt to
adjust controversies, or to take assignments of | 22 | | wage claims. | 23 | | Section 35. Civil actions brought by freelance workers. | 24 | | (a) A freelance worker alleging a violation of this Act | 25 | | may
bring an action in any court of competent jurisdiction for |
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| 1 | | damages as follows: | 2 | | (1) Any action alleging a violation of Section 15 | 3 | | shall be brought within 2 years after the acts alleged to | 4 | | have
violated this Act occurred. A freelance worker who | 5 | | solely alleges a violation of Section 15 must prove that | 6 | | he or she requested a written contract
before the | 7 | | contracted work began. | 8 | | (2) Any action alleging a violation of Section 10 or | 9 | | Section 20 shall be brought within 6
years after the acts | 10 | | alleged to have violated this Act occurred. | 11 | | (b) Within 10 days after having commenced a civil action | 12 | | under
this Section, a freelance worker shall serve a copy of | 13 | | the complaint upon
an authorized representative of the | 14 | | Director. Failure to serve a copy of the
complaint to the | 15 | | Director does not adversely affect any freelance worker's | 16 | | cause of action. | 17 | | (c)(1) A freelance worker who prevails on a claim alleging | 18 | | a violation of
Section 10 shall be awarded damages equal to | 19 | | twice the amount of the contracted compensation, injunctive | 20 | | relief, reasonable attorney fees and costs, and other remedies | 21 | | as may be appropriate. | 22 | | (2) A freelance worker who prevails on a claim alleging a | 23 | | violation of
Section 15 shall be awarded statutory damages of
| 24 | | $250. | 25 | | (3) A freelance worker who prevails on a claim alleging a | 26 | | violation of Section 20 shall be awarded statutory damages |
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| 1 | | equal to
the value of the underlying contract for each | 2 | | violation. | 3 | | (4) A freelance worker who prevails on a claim alleging a | 4 | | violation of this Act and one or more claims alleging a | 5 | | violation of any other State law regarding wage payment shall | 6 | | be awarded statutory damages equal to the value of the | 7 | | underlying contract for the violation of this Act in addition | 8 | | to the remedies specified for the other wage payment | 9 | | violations. | 10 | | | 11 | | Section 40. Civil actions brought by the State. | 12 | | (a) Where reasonable cause exists to believe that a hiring | 13 | | party
is engaged in a pattern or practice of violations of this | 14 | | Act, the
Attorney General may commence a civil action on | 15 | | behalf of the State in a
court of competent jurisdiction. A | 16 | | civil action brought by the Attorney General under this | 17 | | paragraph shall be
commenced by filing a complaint setting | 18 | | forth facts relating to such
pattern or practice and | 19 | | requesting relief, which may include injunctive
relief, civil | 20 | | penalties, and any other appropriate relief. | 21 | | (b) Nothing in this Section prohibits: | 22 | | (1) a person alleging a violation of this Act from | 23 | | filing a civil
action based on the same facts as a civil | 24 | | action commenced by the Attorney General under this | 25 | | Section; or |
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| 1 | | (2) the Director from sending a notice of complaint, | 2 | | unless otherwise barred from doing so. | 3 | | (c) In any civil action commenced under this Section, the
| 4 | | trier of fact may impose a civil penalty of not more than | 5 | | $25,000 for a finding that a hiring party has engaged in a
| 6 | | pattern or practice of violations of this Act. Any civil | 7 | | penalty so
recovered shall be paid into the General Revenue | 8 | | Fund. | 9 | | Section 45. Scope of contracts. | 10 | | (a) Except as otherwise provided by law, any provision of | 11 | | a
contract purporting to waive rights under this Act is void as
| 12 | | against public policy. | 13 | | (b) The provisions of this Act supplement, and do not | 14 | | diminish or
replace, any other basis of liability or | 15 | | requirement established by
statute or common law. | 16 | | (c) Failure to comply with the provisions of this Act does | 17 | | not
render any contract between a hiring party and a freelance | 18 | | worker void
or voidable or otherwise impair any obligation, | 19 | | claim, or right related
to the contract or constitute a | 20 | | defense to any action or proceeding to
enforce, or for breach | 21 | | of, the contract. | 22 | | (d) No provision of this Act relating to freelance workers | 23 | | shall
be construed as providing a determination about the | 24 | | legal classification
of any such worker as an employee or | 25 | | independent contractor. |
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| 1 | | Section 50. Public awareness campaign. The Department | 2 | | shall conduct a public awareness campaign,
that shall include | 3 | | making information available on its website, otherwise | 4 | | informing hiring parties of the provisions of this Act, and
| 5 | | establishing a means for assistance by a person through phone
| 6 | | and email. | 7 | | Section 55. Surveys; information collection; reporting | 8 | | requirements. | 9 | | (a) No later than 6 months after the Director sends to a
| 10 | | freelance worker either a hiring party's response and | 11 | | accompanying materials or a notice of non-response in | 12 | | accordance with this Act, the Director shall send the | 13 | | freelance
worker a survey requesting additional information | 14 | | about the resolution
of the freelance worker's claims. The | 15 | | survey shall ask whether or not
the freelance worker pursued | 16 | | any such claims in court or through an alternative dispute | 17 | | resolution process and whether or not the hiring
party | 18 | | ultimately paid any or all of the compensation the freelance | 19 | | worker alleged was due or if the matter was resolved in a | 20 | | different manner.
The survey shall state clearly that response | 21 | | to the survey is voluntary. | 22 | | (b) The Director shall collect and track information about
| 23 | | complaints alleging violations of this Act. The information
| 24 | | collected shall include, at minimum: |
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| 1 | | (1) the identity of the hiring party alleged to have | 2 | | violated this
Act; | 3 | | (2) the freelance worker's occupation; | 4 | | (3) the Section of this Act that was alleged to have | 5 | | been
violated; | 6 | | (4) the value of the contract; | 7 | | (5) the response or non-response from the hiring | 8 | | party; and | 9 | | (6) information from a completed survey identified in | 10 | | subsection (a). | 11 | | (c) One year after the effective date of this Act, and | 12 | | every 5
years thereafter by November 1, the Director shall | 13 | | submit to the
General Assembly and publish on its website a | 14 | | report regarding the effectiveness of the provisions of this | 15 | | Act at improving freelance
contracting and payment practices. | 16 | | Such report shall include, at a
minimum: | 17 | | (1) the number of complaints the Director has received | 18 | | in accordance with the provisions of this Act; | 19 | | (2) the value of the contracts disaggregated into | 20 | | ranges of $500 and by the Section of this Act allegedly | 21 | | violated; | 22 | | (3) the numbers of responses and non-responses | 23 | | received by the
Director disaggregated by contract value | 24 | | into ranges of $500 and by the Section of this Act | 25 | | allegedly violated; | 26 | | (4) the proportion of surveys received from freelance |
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| 1 | | workers that
indicate that they pursued their claims in | 2 | | court and the proportion of
surveys received from | 3 | | freelance workers that indicate that they pursued
their | 4 | | claims through an alternative dispute resolution process | 5 | | and a
summary of the outcomes of such cases; and | 6 | | (5) legislative recommendations, including | 7 | | consideration of whether
certain occupations should be | 8 | | exempted from the scope of the definition
of "freelance | 9 | | worker" in this Act.
| 10 | | Section 99. Effective date. This Act takes effect upon | 11 | | becoming law.
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