How to Use Independent Contractor Agreements

independent contractor agreements

Just what exactly is an independent contractor agreement?

Independent contractor agreements are a kind of contract that companies use when they send certain projects or functions out-of-house rather than handling them in-house.

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These legal documents usually explain what the freelancer is to do, when the company needs to have their work done by, and some language about how and when the independent contractor is going to be compensated.

How is an independent contractor agreement usually put together?

Normally structured independent contractor agreements do not need to be extremely long or complicated. Instead, they just need to convey the terms of the agreement between the parties as simply as possible while still maintaining necessary thoroughness.

The following are some of the most commonly used clauses in independent contractor agreements:

1. A fair amount of detail on the scope of work the freelancer will be expected to perform.
2. Details regarding the compensation the independent contractor is to receive and a timescale for payment(s), including any milestones that trigger partial payment.
3. Guidelines for determining if the freelancer work is of the required quality.
4. Language clarifying that the intellectual and physical rights to any work performed or created by the freelancer belong to the company.

Related Article: Non-Compete Agreements And Independent Contractors

If the independent contractor agreement is put together sufficiently well, both the hiring company and the contractor will enjoy significant protections.

  • The freelancer will benefit from the advance knowledge of how they are going to be paid as well as from a clear set of guidelines for the work they are to perform.
  • The company will benefit from knowing exactly what the project will cost them and the ability to factor it into their budget, a good degree of creative control, and final ownership of whatever is ultimately produced.

Are you looking for help creating your own independent contractor agreements?

Do you need help drafting an independent contractor agreement for your company to use?

Related Article: Should You Use Independent Contractors In An Internet Business?

Business Contracts Lawyer Mike Young has been helping companies with these agreements and other company legal documents since the mid-1990s. If you need an agreement, be sure to check out our flat fee Business Contract Legal Protection Package.

Author Mike Young, Esq.

Mike Young has been practicing business and technology law since 1994. He's been an entrepreneur since 1988. To get legal help from Attorney Young, click here now or call 214-546-4247 to schedule a phone consultation.

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