Illinois Requires Written Contracts for Independent Contractors
Starting July 1, 2024, the Illinois Freelance Worker Protection Act (the Act) requires that in most cases, an entity engaging an independent contractor must have a written contract with the contractor. The Act applies to any independent contractor arrangement where the contractor provides products or services with a value greater than $500 for a single contract or in the aggregate over a 120 day period. The Act does not apply to employees or to independent contractors in the construction industry.
The Act requires that the written contract must include:
- The name and contact information of the entity and the freelance worker
- The products and services to be provided by the freelance worker, the value of these goods and services, and the rate and method of compensation
- The date on which the worker will be paid, or the mechanism by which the date will be determined. The date may not be more than 30 days after provision of the goods or services.
- If the contract requires the worker to submit a list of the goods or services provided, the date by which the worker must submit the list.
Contracts must be retained for a two year period. The Act requires the Illinois Department of Labor to post model contracts on its website.
The Act provides that workers may report violations to the Illinois Department of Labor. Workers who are not timely paid in accordance with the Act may also file suit to recover double the amount of the underpayment, plus costs and attorneys fees. A freelance worker who requested a written contract but did not receive one is entitled to statutory damages of $500.
Our firm monitors this issue closely and will report other significant developments.
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