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Is New York City’s FIFA Law Poised to Take Center Stage?

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Attorney Harrison Oldham

 

 

 

One of New York City’s appellate courts recently issued the first appellate decision interpreting New York City’s Freelance Isn’t Free Act (“FIFA”).  The case is Chen v. Romona Keveza Collection LLC.  In Chen, the plaintiffs were a photographer and a model that claimed the defendants violated FIFA by improperly withholding payments for services provided to the defendants.

 

As with other New York City laws, under FIFA, a freelance worker may file an administrative complaint before bringing an action in court but is not required to do so, which is exactly what happened in Chen.  There, the plaintiffs filed an administrative complaint against the defendant, a fashion label, claiming the defendant failed to pay them in full for a photo shoot in October 2019. Subsequently, the plaintiffs filed suit in state court after the fashion label failed to respond to the administrative complaint. The central issue on appeal was whether the model could be classified as a “freelance worker” under FIFA when a modeling agency represented her.  Following its review, the appellate court ruled that representation by an agent does not necessarily disqualify a worker from FIFA’s freelance worker protections.

 

Freelance Isn’t Free Act

FIFA was enacted in 2016 and became effective on May 15, 2017.  Some have described FIFA as the first act in the United States to provide legal protections for freelance workers against nonpayment for work performed. Although the law has several features, in general, FIFA establishes and enhances protections for freelance workers, explicitly providing the right to (i) a written contract in certain situations, (ii) timely and complete payment, and (iii) protection from retaliation.

 

However, to be protected by FIFA, an individual must first meet the definition of a “freelancer worker”, and an employer must be the “hiring party”.

 

Determining “Freelance Worker” and “Hiring Party” Status

FIFA defines a “freelancer worker” as “any natural person or organization composed of no more than one natural person, whether or not incorporated or employing a trade name, that is hired or retained as an independent contractor by a hiring party to provide services in exchange for compensation.”

 

As such, in Chen, the defendant fashion label argued that according to the terms of the model booking agreement, the model was not a freelancer but rather an employee of the modeling agency. The fashion label also argued that it was in contractual privity with the modeling agency – not the model herself – meaning the defendant could not have been the model’s “hiring party” for FIFA purposes.

 

As part of its opinion, the court noted that FIFA is “silent as to how to factor an agent into the calculus of whether someone is a freelance worker,” but that workers represented by agents are not among the enumerated examples of individual workers excluded from the freelancer definition.  Additionally, the court held that the model booking agreement and the invoices issued thereunder were not dispositive of whether the fashion label, rather than the modeling agency or some other party, was the model’s “hiring party.”

 

The court did not detail its legal reasoning, but its holding implies that courts may look to the reality of the work performed rather than how the transaction is contractually structured.  In other words, if the model was performing work that benefited the fashion label, she may state a claim against the fashion label rather than the modeling agency, even if the agency may ultimately pay her for the work.

 

Ultimately, the Appellate Division held that the model’s claims were adequately pled and that her representation by an agency did not, without more, exclude her from the protections afforded to freelance workers under FIFA.

 

The Appellate Division also signaled the model had sufficiently pled her standing to sue the fashion label as the “hiring party.” By this ruling and the court’s determination that the parties “should engage in discovery to ascertain” whether the model was a freelance worker for FIFA purposes, the court essentially held that a represented model’s status as a freelancer is a question of fact.  However, the court did not explain what factors would be relevant in making that determination.

 

Key Takeaways

With this first appellate decision, the enforcement of freelance worker protections may increase across multiple industries, including fashion and the arts.  As such, employers should not assume that using a talent agency or staffing company will insulate them from the obligations that FIFA places on hiring parties concerning their freelance workers.  Instead, employers should investigate how they pay all the individuals and entities working on site (or their remote equivalents).  If the result of that investigation shows potential FIFA concerns, then employers should act now instead of risking a FIFA-based complaint.


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About Harrison Oldham

Harrison grew up in Mansfield, Texas. He attended Texas A&M University for his bachelor’s degree, where he met his wonderful wife, Kelsey. After graduating magna cum laude from Texas A&M, he attended SMU Dedman School of Law, graduating with honors in 2012. Today, Harrison and his wife live in Dallas, Texas with their son, Teddy.

Since graduating from SMU Law, Harrison has worked exclusively in the field of business law. He has spent time in private practice and in-house, working with clients of every size; from single person startups to Fortune 250 companies. Today his practice focuses on serving the diverse needs of businesses and individuals throughout Texas. You can learn more about Harrison by visiting his website, at: http://lonestarbusinesslaw.com/.

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