Business & Work

The Illinois Freelance Worker Protection Act (FWPA) took effect on July 1, 2024. Learn more about your rights as a freelance worker below.  

Who is an independent contractor? Who is a freelance worker?

Whether you are considered an employee or an independent contractor depends on the facts. Generally, you are an independent contractor if the person paying you has the right to control or direct only the result of your work. That means the employer does not have control over what will be done or how it will be done. Learn more about how the Internal Revenue Service defines an independent contractor.

A freelance worker is someone hired as an independent contractor in exchange for $500 or more in either a single contract or a series of contracts during the past 120 days. In Illinois, a construction worker is not considered a freelance worker and is only considered an independent contractor in extremely limited circumstances.

Rights protected under the FWPA

Right to payment

A business that has contracted for your services is required to pay you. If the contract includes a date your payment is due, the business must pay you no later than that date. If you are a freelancer and the contract does not say when you will be paid, the business must pay you no later than 30 days after you complete all the contracted work.

If you have not been paid on time, you can file a complaint with the Illinois Department of Labor (IDOL) or file a lawsuit in circuit court. These claims must be filed within two years of when the final payment was due.

Right to a written contract

If you are a freelance worker, you have a right to a written contract that outlines the terms of your agreement. The contract should include:

• Name and contact information of the contracting entity and freelance worker,
• A list of products and services provided,
• Rate and method of payment,
• Date when payment is due (no later than 30 days after you complete all of the contracted work), and
• Dates of service.

You can find a sample written contract here.

If the business you are working with refuses to provide you with a copy of the agreement or retaliates against you for asking for one, you can file a complaint with IDOL or file a lawsuit in circuit court.

The FWPA only applies to contracts taking effect after July 1, 2024.

Right to be free from discrimination

The business you are working with cannot discriminate, harass, or take any action to penalize you for exercising your rights under the FWPA.

Filing a complaint with IDOL

If you are a freelance worker in Illinois and believe your rights under the FWPA have been violated, you can file a complaint with the IDOL by:

• Completing and submitting IDOL's complaint form, and
• Submitting copies of all supporting documents.

IDOL may need more information from you, such as:

• Your job sector or type of work,
• The county where you worked (if in Illinois), and
• Your demographic information.

Your complaint must be filed within 2 years of when final payment was due. Once you have filed a complaint, IDOL will provide you with a written explanation of what happens next.

Within 20 days of receiving your complaint, IDOL will either:

• Let you know they cannot handle your complaint because it is not within their authority, or
• Begin a process to gather more information called the "information facilitation process."

The information facilitation process begins with notifying the company you worked for about the complaint. The notice of the complaint will:

• Tell the violating company that a complaint has been filed against them alleging a violation of the FWPA,
• Explain the legal options you have as a freelance worker if your rights were violated,
• Include a copy of your complaint, and
• Warn the violating company that if they do not respond by the deadline provided, it could be seen as admitting fault in any future legal action you take.

If IDOL receives a written response from the company, they will send you a copy of the response and any attachments within 20 days. IDOL will also send you information about the status of your complaint and your right to bring an action in court.

Other things to know as a freelance worker

Right to be free from sexual harassment

In Illinois, nonemployees, like independent contractors, are protected from sexual harassment. Employers are responsible for sexual harassment of nonemployees by nonmanagerial and nonsupervisory employees if the employer knew about the harassment and failed to make reasonable efforts to stop it.

Am I eligible for unemployment insurance benefits?

Even if you are considered an independent contractor for tax purposes, you may be eligible for unemployment insurance. You may be eligible for unemployment benefits unless an employer can show that:

• you are free from control or direction over your performance of services,
• the services you performed are outside the usual course or place of the employer's business, and
• you are engaged in an independently established trade, occupation, profession, or business. 

You can apply for unemployment insurance benefits with the Illinois Department of Employment Security.

Taxes

Companies do not withhold any taxes from payments to independent contractors. This means that you have to pay taxes quarterly. When a company pays you, you may want to set aside 20% to 30% of your income to make sure you have enough money to pay your taxes. 

Learn more about taxes and freelance jobs.

You can use Form 1040-ES, Estimated Tax for Individuals to figure out if you owe taxes quarterly. You will need your prior year’s annual tax return to fill out Form 1040-ES. See the Internal Revenue Service website for more information. 

Learn more

You can learn more about the FWPA on the Illinois Department of Labor's website.