Outsourcing jobs or tasks to independent contractors is a common practice among small and large businesses alike to save on overhead costs and to gain easier access to expertise and tools to accomplish them. If your business is about to outsource any task to them, you will need to make and provide an independent contractor agreement. Some contractors will provide their service agreements. However, you should also make your contractual arrangements, which will be in your best interests.

The basics

An independent contractor agreement may be similar to a service agreement, but they have one major difference, which is dependent on your position. That said, one agreement might be more beneficial than the other.

The services agreement will be more beneficial for the party giving the services, and the independent contractor’s agreement is advantageous to you, the party receiving their services. Your agreement’s contents will depend on the kinds of services offered by the contractor and their industry. It’s best to be aware of the certain terms that should be part of it:

  • independent contractor agreementServices offered – There should be specific details on the project or the services you are making the contractor do. It should set out the hours of work and the key milestones for deliverables, and how contractors will be paid.
  • Period of the arrangement – The term of the arrangement in the independent contractor agreement should be specified. Start and end dates for project-specific arrangements should also be included. Further, a detailed termination clause should be included if the contractor will be part of an ongoing project. Finally, it is also important to establish how the contractor can accept the work request when they are hired on an ‘as needed’ basis.
  • Obligations of the contractor – This will depend on the services they can provide and their industry.
  • Intellectual property and confidentiality – The confidentiality clause will prevent the contractor from disclosing any confidential information. Contractors must understand what will happen to intellectual property being created or used by the contractor.

If you’re not sure how to make an agreement for independent contractors, look up legal templates you can use. Some services can also provide some legal document in different languages.

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