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After Hochul’s 2022 Veto, Lawmakers Reintroduce Bill to Protect Freelance Workers Statewide


(photo: @Sen_Gounardes)


The pandemic changed employment patterns across the country, with more and more Americans turning to freelance or independent work to make a living — only hastening a trend many years along. But New York State still lacks wage protections for freelance and independent workers, something two lawmakers are hoping to remedy after last year’s attempt to do so was vetoed by Governor Kathy Hochul, a fellow Democrat.

This week, Brooklyn State Senator Andrew Gounardes and Assemblymember Harry Bronson of Rochester reintroduced the Freelance Isn’t Free Act, a bill that would provide mandatory contracts, timely payments, and redressal mechanisms against wage theft for independent workers. The bill is modeled after similar legislation that went into effect in New York City in 2017. 

“I feel very optimistic,” Gounardes said in a phone interview. “I think last year, we ran up against the clock issue and were not able to have effective conversations with the governor's office about potential changes or other things that they may want to talk about.”

The legislation guarantees mandatory contracts to freelancers for any work over $250 or an aggregate of $800 or more over four months. The burden of providing a contract falls on clients, who can otherwise be penalized $250 for refusing to use one. Contracts must specify payment dates and, if they do not, must be paid out within 30 days of the work being completed.

It also includes anti-retaliation protections and legal assistance for freelance workers, as well as double damages for wage theft and attorney fees. Employers who are found to be engaged in a pattern of violations can be fined up to $25,000, and could also face potential criminal penalties. 

“In my many years as a labor attorney and now as a member of the New York State Assembly, I know that independent contractors are not protected by the same minimum wage laws as regular employees and generally ineligible for unemployment and workers compensation, and are some of the most exposed laborers in our state when it comes to wage theft,” said Assemblymember Bronson, in a statement on Wednesday. “Freelance workers are a rapidly growing sector of the economy. Our legislation is a commonsense approach to ending the economic discrimination against freelancers and putting a value on their contributions.”

A report by the consulting firm McKinsey & Co, released in August 2022, found that 36% of Americans surveyed, which translates to about 58 million people, identify as independent workers, up from 27% in 2016. Among the reasons for the uptick, the company cited larger pools of workers on digital platforms, a shift to independent workers because of the pandemic, and pandemic layoffs and high inflation which could have pushed people towards independent work. 

“This issue I think is always important, but especially in light of the pandemic, when we've seen people switch to non-traditional forms of employment in this way,” Gounardes said. 

Independent work often comes with a price, however. Freelancers suffer from wage theft, delayed payments and other issues that would otherwise count as labor law violations. A survey released February 16 by the Independent Economy Council, a volunteer-led research and advocacy group, found that 74% of independent workers said they were not getting paid on time and 72% had outstanding invoices that have gone unpaid – 59% of such workers were owed $50,000 or more for already completed work.

Those findings portray a similar picture as another study from 2019, published by the Freelancers Union and Upwork, which showed that 59% of freelancers said they lived “paycheck to paycheck” and freelancers lost, on average, $5,968 annually to wage theft.

The Freelance Isn’t Free Act passed the State Senate on June 1 last year, and was approved by the Assembly the next day. On December 12, it was delivered to the governor for her approval or veto. 

On December 23, however, Governor Hochul vetoed 165 bills, among them the Freelance Isn’t Free Act. In signing the veto, Hochul said she supported “efforts to ensure that New Yorkers are paid for their hard work.” But she expressed concerns about the costs associated with the legislation, requiring “at least several million dollars annually” and a significant increase in staffing at the state Department of Labor. As is typical of governors, Hochul vetoed most bills that were deemed to have enough of a fiscal impact that she believed they needed to be accounted for in the state budget.

A budget for next fiscal year is due from Hochul and the Legislature by April 1 — the governor has proposed a $227 billion budget for next fiscal year, up from $221.6 billion last year.

Besides citing “significant staffing and programmatic burdens,” Hochul also said the bill would require the Department of Labor to get involved in regulating private contracts between companies and non-employees, which falls outside the agency’s statutory authority. 

“We will review the legislation if it passes both houses,” said Hazel Crampton-Hays, a spokesperson for the governor, in an email. 

Gounardes, who chairs the Senate’s Committee on Committee on Budget and Revenue, was “skeptical” of the fiscal concerns that Hochul raised though he did concede that it will require more from the labor department. “I recognize that the Department of Labor has historically been underfunded when it comes to staffing up to prosecute and go after wage theft. It's an ongoing issue,” he said. 

But, he noted that the bill has a two-tiered enforcement structure. Workers can either seek administrative adjudication by the state Department of Labor or go to court for damages. “That also helps ease the burden on the department,” Gounardes said. 

Rafael Espinal, executive director of the non-profit Freelancers Union, echoed Gounardes, pointing to the success of New York City’s Freelance Isn’t Free Act, which was the first of its kind in the nation when it passed. The law, which Espinal helped pass as a City Council member, has helped freelancers claw back millions in unpaid wages. Between March 2017, when the law went into effect, through December 2021, the city’s Department of Consumer and Worker Protection handled more than 2,100 complaints under the law, and has won more than $2.4 million in restitution for 702 workers, according to the city’s fifth annual “The State of Workers’ Rights in New York City” report

“The pandemic has shown that if there isn't a social safety net in place to ensure people are getting paid for work they complete or don't have access to basic social safety net protections, that they end up being in financially dire situations,” said Espinal, who was highly critical of the governor’s veto. “I think that the pandemic has really created this higher understanding of the needs of the independent workforce and the importance of government playing a role in ensuring the protections they need to ensure their income.” 

Espinal has also pointed out that the governor’s State of the State policy agenda and executive budget proposal do not contain any new proposed protections specifically for independent workers. “The Governor’s clearly doesn’t have her finger on the pulse of NY. Freelancers were denied payment protections through a veto in 2022, now they’re left out in 2023,” he tweeted last month.

“This is a problem everywhere. It's not just a New York City problem,” Gounardes said. “You could be a graphic designer in Watertown, you could be a writer in Rochester, you could be a photographer in Binghamton. You could be anywhere and this is a challenge. So it only makes sense that we do this to help these folks.”

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by Samar Khurshid, senior reporter, Gotham Gazette
     

Read more by this writer.

6 State Budget Proposals Where Hochul and Adams are At Odds


Gov. Hochul and Mayor Adams (photo: Ed Reed/Mayoral Photography Office)


Governor Kathy Hochul and Mayor Eric Adams have a strong working relationship, one that they have repeatedly emphasized at joint announcements, news conferences, and speeches. It’s in clear contrast to their predecessors, who spent years squabbling over many issues, both parochial and consequential to New Yorkers. But with the recent release of the governor’s budget plan, the two first-term Democrats find themselves at odds over various cuts, cost shifts, and unfunded mandates for New York City that the mayor is none too pleased about. 

In his February 15 budget testimony before the State Legislature, Mayor Adams had several words of praise for Governor Hochul and her $227 billion budget proposal. He pointed to items in her housing agenda, investments in mental health, proposed changes to capital construction process reforms and M/WBE procurement, and more. He also cited boons the city got from last year’s budget including expanded child care, a new funding mechanism for the New York City Housing Authority (NYCHA), an expansion of the Earned Income Tax Credit, and a broadening of the city’s speed camera program. 

“Governor Hochul and leaders in the Senate and Assembly have been excellent partners to the city and our administration,” he said in Albany. “My hope, and my belief, is that we’ll be able to sort out our differences and work together to build a budget that works for all New Yorkers.”

Following his testimony, in a brief question-and-answer session with reporters in New York City, the governor echoed his sentiments. “We've been partners,” she said, “and this is still sort of a new era that people aren't quite used to, seeing the two of us really joined together in furtherance of lifting up the City of New York.”

Nonetheless, the mayor had several gripes about the governor’s budget, including inadequate funding for the migrant asylum-seeker crisis in the city; a proposal to increase the city’s contribution to the MTA; needed funding associated with her plan to lift the charter school cap in the city; lack of additional funding for a class size reduction mandate that is about to go into effect; hundreds of millions in cuts to Medicaid support; and a continuing sales tax intercept that saps $150 million from the city each year. 

[READ: In Albany, Mayor Adams Testifies on Governor Hochul's Budget, State Priorities]

Adams repeatedly emphasized that the additional costs the city estimates would result if Hochul’s budget passed would strain the city’s coffers. Adams recently proposed a $102.7 billion budget for the city’s next fiscal year, which begins July 1 and will take the next state budget into account. The mayor said his administration would have to cut basic services if the governor’s plan proceeds on those various fronts as-is.

According to his prepared testimony, the mayor intended to present that scenario as a warning to legislators who will negotiate the budget with the executive branch. “The city cannot possibly carry the weight of such big commitments without cutting essential programs that support New Yorkers,” said the mayor’s prepared remarks, which were provided to the media. “This is not a threat. This is math.” (Adams did not end up speaking the words in front of the Legislature.)

Asylum-Seeker Funding
The Adams administration has been struggling to manage the ongoing arrival of tens of thousands of migrant asylum-seekers from southern border states. According to the administration’s estimates, about 47,000 migrants have come to the city in the last year, which has tested the limits of the shelter system and strained the city budget. 

Adams has estimated that it will cost the city about $4 billion between the current and next fiscal years to shelter and provide services to the migrants, and he has repeatedly urged the federal and state governments to provide greater assistance. 

The governor’s budget allocates about $1 billion to the city for that purpose over two years – $767 million to reimburse the city for 29% of shelter costs (in line with other shelter cost-sharing); $162 million in operational and logistical support through the State National Guard; $137 million for health care costs; a $25 million resettlement fund for nonprofit groups; $10 million for legal assistance; $6 million for the city’s new shelter site at the Brooklyn Cruise Terminal; and $5 million for other resettlement assistance. Hochul’s budget also creates a framework that would split the costs of overall services evenly between the city, state and federal government. 

Adams has requested $1 billion to start from the federal government but so far the city has only been able to secure a paltry $8 million from the Federal Emergency Management Agency, leaving major costs unfunded. In a spending package passed in December, Democrats who controlled the federal government allocated about $800 million for assistance on the topic, much of which is expected to go to New York City through FEMA but has not yet arrived.

MTA Funding
In her budget proposal, Hochul presented a plan to address the MTA’s ongoing financial struggles. Though the transit authority has survived the pandemic with the help of federal aid, it currently has a $600 million structural deficit, which will increase to $1.2 billion in the 2024 fiscal year and $1.6 billion by the 2026 fiscal year.

Though Hochul advanced several measures to bolster the MTA, which runs the city’s buses and subways as well as the commuter rails – $300 million in one-time state aid, $800 million in additional revenue by increasing the Payroll Mobility Tax, and between $462 and $826 million from a share of licensing fees from new downstate casinos – she also proposed that the city should cough up an additional $500 million annually directly into the MTA’s operating budget.

The MTA is also planning to raise fares and tolls, which were scheduled for last year but postponed in partnership with Hochul and other state leaders in order to encourage a return of ridership to the system. 

“We are being told to add a half-a-billion dollars on to our budget for eternity,” Mayor Adams said at the legislative budget hearing. “That is just unfair. No other municipality has been asked to do this…We should spread the pain throughout the entire state because we realize the MTA is a statewide entity.”

The city already contributes $2.4 billion annually to the MTA’s operating budget, the mayor said, while estimating that the actual cost of the governor’s proposal would be about $526 million in the next fiscal year and above $540 million annually in the years that follow.

According to the governor’s office, the $500 million would cover the state’s current payments for the city’s paratransit program and discounted MetroCard program for students. In response to a Gotham Gazette inquiry about Adams’ testimony, a spokesperson for the governor noted that MTA New York City Transit accounts for 71% of the MTA's annual deficit.

The spokesperson also pointed out that the MTA pays half of the city’s paratransit costs, while other counties served by the agency – Nassau, Suffolk, and Westchester – each pay entirely for their own paratransit programs. The MTA also pays for 58% of the city’s student MetroCard program, while all other local governments in the state pay for costs of student transportation.

Additionally, the spokesperson pointed to the city’s own projections of billions in surplus revenues in the current and upcoming fiscal years. Those projections have only grown recently and appear in part to be at the root of the governor’s budgeting on the MTA and beyond.

Education Funding
At the legislative budget hearing, Adams reiterated prior complaints about a class size reduction mandate for city schools that was approved last year – part of the legislation to extend mayoral control of city schools – and goes into effect this year. Adams has said it comes without additional dedicated funding, but the governor and state lawmakers have pushed back on that assertion, noting large increases in state education aid to the city that they say can pay for the class size reductions.

Adams has estimated it will soon ramp up to cost the city $1.3 billion annually beginning in the fifth year of implementation; largely due to personnel and space costs.

The governor also proposed a new measure in her budget this year to eliminate the cap on charter schools in New York City. The city currently has 275 charter schools with 142,500 students, about 15% of the city’s schoolchildren. 

Adams said that lifting the cap, which he supports, could add another $1 billion in annual costs to the city, largely for school siting. Due to a state law passed under Governor Andrew Cuomo a number of years ago, the city government must either provide school real estate to charter schools or pay for them to rent other space.

Adams was somewhat evasive about the larger question of raising the cap on charter schools in the city, but explicitly reiterated that he supports the re-issuing of about 20 “zombie charters” that were issued but whose schools since closed.

The governor’s office has, in response, noted that the state is proposing to give New York City $13 billion in formula-based School Aid, up by $594 million or 4.8% — the highest amount ever proposed — which accounts for charter school students. Charter advocates have also noted that when students are educated by charter schools, per-pupil funding goes with the students and they are not students that traditional district schools must pay to educate.

Medicaid Funding
Governor Hochul’s budget proposes that the state will hold on to 100% of enhanced Federal Medical Assistance Percentage (eFMAP) funding to localities. That funding supplements local spending on Medicaid, without which localities will have to either absorb increased costs or cut services. Adams has said the city could lose up to $343 million from that proposal. 

The proposal is also setting up a fight with localities across the state, and the New York State Association of Counties has estimated that it will cost counties outside New York City about $281 million in the first year. Over a three-year period, it could cost $2.5 billion to all local taxpayers.

“Not only does this proposal harm New York's local taxpayers, but it also subverts Congress' intent for this funding to be shared with the local governments that contribute to the state's Medicaid program,” said Michael Zurlo, Clinton County Administrator and president of the New York State Association of Counties, in a statement after delivering testimony to the State Legislature last week. “At $7.6 billion a year, counties in New York contribute more than all other counties in the nation combined.”

Public Defender Funding
Hochul has said she wants to increase resources for both district attorneys and public defenders to tackle the increasing backlog of criminal cases in the state court system. It’s a call that’s been echoed by Mayor Adams as well. But Hochul’s budget doesn’t give New York City enough to fulfill that goal, Adams said, while imposing a new cost on the city’s coffers. 

As part of the budget, the governor has proposed wage increases for ‘18-B’ assigned counsel attorneys, private attorneys appointed by courts to defend indigent clients under Article 18-B of County Law. But she has only proposed about $44 million in additional funding to pay for raises, and only for 18-B attorneys under the Attorney for Child Representation program. That would leave the city with additional costs of about $18 million a year, Adams said in his testimony.

[READ: As Prosecutors Get Budget Boost, Public Defenders Seek More Funding Too]

Sales Tax Intercept
The governor’s budget continues intercepting about $150 million annually in sales tax from the city for the state’s distressed hospitals fund, a recurring money grab that has sapped hundreds of millions from the city over the last several years. “$150 million of the city’s tax revenues are intercepted yearly for this fund, and New York City is the only locality paying,” Adams said. “Despite this, not a single [NYC Health + Hospitals] hospital has received a dollar of support.”

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by Samar Khurshid, senior reporter, Gotham Gazette
     

Read more by this writer.

In 2023 Agenda, Hochul Vows to Make State Government Work Better for New Yorkers


Gov. Hochul delivers remarks (photo: Darren McGee/Governor's Office)


When she released her 2023 agenda in January, Governor Kathy Hochul announced a multi-pronged effort to “make government work better for New Yorkers” through improved access to government services and public benefits. How New Yorkers interact with state government will be overhauled and modernized, according to Hochul, in her 277-page State of the State policy book.

“By eliminating bureaucratic hurdles, simplifying processes, and utilizing new technology, we will vastly improve the way New Yorkers access services and benefits from State agencies,” Hochul said in the book that accompanied her address.

Hochul is promising residents a streamlined online experience, through the implementation of a series of technological enhancements aimed at uniting government agencies and eliminating red tape and frustrating inconsistencies. 

The proposed statewide initiatives will move several benefit applications more fully online, introduce the increased use of direct deposits, and expedite access to aid for those who qualify. The changes would apply to everything from obtaining tax credits to Childcare Assistance Program applications to Department of Motor Vehicles (DMV) services.

In addition, Hochul will appoint a new Chief Customer Experience Officer to supervise these widespread changes.

Perhaps most significantly, the governor is promising a single login or ‘One ID’ for use across state agencies that will reduce the duplicative applications currently required of New Yorkers in order to receive aid and interact with state government.

“The aim of ‘One ID’ is to create a simple, straightforward and seamless path for residents who are eligible for state services,” said Scott Reif, a spokesperson with the state Office of Information Technology Services. “When fully implemented, ‘One ID’ will help the State better prevent fraud and allow eligible New Yorkers to more easily interact with their government and receive the benefits they need and deserve.”

The ‘One ID’ rollout will be carried out in four phases, building on initiatives that are already underway, according to Reif. Duplicate accounts will be eliminated, accounts will be consolidated across services, and a single ‘One ID’ will be rolled out with a soft launch. No exact timeline has been established.

The proposal is reminiscent of New York City Mayor Eric Adams’ delayed ‘My City’ portal; it does not appear any effort is being made to unify the efficiency-focused initiatives.

Most of the governor’s plan to make state government work better for New Yorkers does not appear to need to be negotiated with the State Legislature, unlike many other parts of her policy and fiscal agenda. On February 1 Hochul released her $227 billion Executive Budget for next state fiscal year, which begins April 1, and it has become the focus of a series of legislative budget hearings.

Hochul’s plan includes expanded use of e-signature technology. Currently, many documents must be printed, signed, and then scanned, placing a ‘time tax’ on New Yorkers who are in need of services, and delaying the receipt of aid. 

“We often field requests for assistance from New Yorkers who are having difficulty applying for rental assistance and other public benefits online because of the bureaucratic hurdles inherent in the process,” said Jeff Maclin of Community Service Society of New York, a nonprofit organization that works directly with low-income New Yorkers. “Any effort to make it easier and less onerous for people to navigate the system and obtain the information they need in a timely manner is a plus.” 

Currently, New Yorkers who are entitled to government services are often met by long wait times and outdated websites, Hochul’s press release stated. Hochul’s announcement cited the bureaucratic hurdles that Maclin pointed to as often preventing residents from ever accessing the safety nets designed to help them. Filing for unemployment insurance, accessing tax credits, and even simply applying for a driver's license often require in-person appointments, according to Hochul’s release. Forms and websites are laden with complicated jargon. Surface mail communications frequently go missing. Different agencies require the same information to be submitted across multiple applications, wasting processing time both for residents and State workers. 

In addition, eligibility for services like New York’s Child Care Assistance Program (CCAP), often differs from county to county. Hochul’s plan seeks to streamline all this, easing access to government, unifying service eligibility statewide, and simplifying communication across government agencies.

According to the January 10 press release from Hochul’s office, despite increased federal and state funding for affordable child care, the state estimates that less than 10% of families eligible for New York’s child care assistance program currently access these services. Of those who qualify for the Special Supplemental Nutrition Program for Women, Infants, and Children, or WIC program, the state estimates only 50% utilize the service.

“Child care is critical for working families, especially women, to reach their full career potential,” said Suzanne Miles-Gustave, Acting Commissioner of the state’s Office of Children and Family Services. Dr. James McDonald, acting state health commissioner, added, “Families that rely on the Department’s Women, Infants and Children (WIC) program should have easy access without the burden of navigating cumbersome bureaucratic obstacles.”

To understand why individuals and families are not accessing the services they are entitled to, Hochul’s plan includes conducting a survey of eligible families to guide the distribution of benefits in the future.

Along with updating how people interact online with state services, Hochul’s plan promises to lower call times through the increased use of voice automation and chatbots.

The state’s Department of Motor Vehicles (DMV) believes that through these technological updates, callers will see wait times reduced by 30%, according to Hochul’s announcement. “This assistance from the governor will go a long way toward helping us achieve the goals of our ongoing transformation initiatives, including bringing the DMV to where the customer is and changing the public’s image about us and what we do each day,” said DMV Commissioner Mark J.F. Schroeder.

With customer satisfaction and user experience at the forefront of the entire initiative, Hochul points to her record as Erie County Clerk, where she claims to have transformed the Department of Motor Vehicles customer service experience.

To oversee the promised improvements, Hochul has announced that alongside the appointment of a Chief Customer Experience Officer, a new team of digital professionals will carry out the widespread changes. This team will have its work cut out for it, attempting to make the announced enhancements and updates to many of what Hochul’s administration estimates is over 100 New York state websites still not optimized for mobile use. 

Maclin of CSSNY pointed to some additional potential hurdles in the initiatives designed to make services more accessible. “Not everyone has broadband and access to the internet,” Maclin said. “That goes for many low-income New Yorkers. So either there is a more aggressive push to expand broadband or options to conducting business with state agencies online is readily available and promoted.”

The state’s ongoing $1 billion broadband initiative seeks to alleviate these concerns, promising connectivity in underserved areas.

“New Yorkers who have limited access to the internet or technology will always have the option of contacting a customer service center by phone to get help from a live representative,” said Reif of the state’s Office of Information Technology Services, adding, “‘One ID’ and other initiatives will also reduce the number of people calling or visiting in person, which will free up personnel to help those who have difficulty accessing services online.”

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by Talia Barrington, Gotham Gazette

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