Business owners hire independent contractors for multiple reasons. Therefore, they create standard independent contractor agreements often. Whether they need a handyman’s expertise to upgrade their office or a web developer’s help to build their website, company owners look to independent contractors. As a business owner who needs to hire an independent contractor for the first time, the contract portion of the business venture can get confusing. Read on to learn what to include in a standard independent contractor agreement.
Responsibilities And Deliverables
Firstly, dedicate a section of every standard independent contractor agreement to responsibilities and deliverables. In it, write down what you expect your independent contractor to do. If you hired a contractor to paint your walls, state that their responsibilities include painting all four walls of your office. Determine what color to paint your office beforehand to expedite the process. List any specifications as well. For instance, you may want your painter to use a different color on each wall. Identify which walls should be which colors in your agreement. That way, contractors know what their duties are right from the start. Ensure that you receive quality work by including this section in your standard independent contractor agreement.
Once you list the responsibilities and deliverables, write a section for compensation terms. Your contractor will include their fee structure and rates in this section. Work with your contractor to determine when you need to provide them with the payments. Then, list your agreed upon dates in this section of the contract. Some business owners have strict compensation rules and always pay their contractors after the work is done rather than in chunks throughout projects. If you prefer to pay in this way, converse with your contractor about it. After you include the necessary compensation terms in your standard independent contractor agreement, move onto the other essential clauses.
Independent Contractor Status
Another section to include in your standard independent contractor agreement is the independent contractor’s status. This portion of the agreement entails differentiating the independent contractor from your company’s employees. Independent contractors typically work for multiple businesses at once. With that being said, include any rules or regulations regarding conducting work for other businesses. Usually, business owners assume that their contractors have other jobs and simply state that they can work elsewhere as long as their outside work does not affect their business. Write a section on independent contractor status to eliminate any confusion about contractors and employees.
Furthermore, add a confidential information section to your standard independent contractor agreement. When you do, fill it in by explaining how each party involved should look at the others’ confidential information with the same value that they use to view their own. Popular pieces of confidential information include sales figures, trade secrets and customer data. If you have particular pieces of confidential information that you want to protect, list them in this section. Similarly, list materials that cannot qualify as confidential information to protect yourself from dealing with a lawsuit down the road. Maintain this portion of your standard independent contractor agreement to keep your assets safe.
In addition to the above terms, include project deadlines in each standard independent contractor agreement you write. As the business owner hiring the contractor, take the initiative and create the first draft. Propose it to your contractor and ask them to review it. If they find issues in the project details or do not think that the deadlines are reasonable, work with them to create a second draft. Repeat this process until you agree on deadline dates. Then, list them in your standard Independent contractor agreement. Consider holding online meetings throughout the project to ensure that your contractor is sticking to the schedule.
In order to hire independent contractors legally and safely, both parties need to sign standard independent contractor agreements. When writing such an agreement, include the responsibilities and deliverables you expect your contractor to complete. Then, determine compensation terms such as when payments are due. Independent contractor status is also important because it shows the difference between independent contractors and employees. Protect your company’s sensitive information by incorporating a confidentiality section in your contract. Lastly, work with your contractor to determine the best, most reasonable deadlines for each portion of the project. Include these sections in your standard independent contractor agreement.