Chapter 14.34 of the Seattle Municipal Code is a relatively new ordinance that can affect the parties to a construction contract for work performed within the City of Seattle’s city limits. The Independent Contractor Protection Ordinance (“ICPO”) was enacted to provide self-employed persons, or entities composed of not more than one person, regardless of corporate form, recourse for timely payment for work performed. The ICPO applies to contracts of $600[i] or more between an independent contractor and a hiring entity where the work, in whole or in part, is known to be performed within the City of Seattle’s city limits.[ii] The ICPO cannot be waived by parties to a contract.[iii]

Historically, the primary legal recourse for non-payment or late payment for work performed under a contract involves an expensive breach of contract action, and one reason the ICPO was enacted was to give greater protection to a growing number of Washington independent contractors who report problems with timely and accurate payment.

The ICPO affects “hiring entities” or any individual, partnership, association, corporation, business trust, or any entity, person or group of persons, or a successor thereof, that hires independent contractors to provide services within the scope of a hiring entity’s business or commercial activities. In the construction context, most general contractors, subcontractors, design professionals, and design consultants should be aware of this ordinance, as well as certain owners[iv] and development-side entities.