The Hardest Working Clauses in Your Independent Contractor Agreements
As an entrepreneur that isn’t exactly ready to hire a full team, but needs extra help in your business, independent contractors can often be your saving grace.
Prior to entrepreneurship, you may not have fully realized what the role of an independent contractor is.
But the second that your to-do list became too much for you to manage on your own, you likely quickly realized that a contractor is EXACTLY what you need!
(I’m a big fan of them myself!)
If you’re new to the world of independent contractors, essentially they are individuals hired to perform very specific tasks in your business.
For example, if you want to start marketing on Pinterest, you might hire a Pinterest Manager.
Or if you want to start blogging in your business, but don’t have the capacity to do it, you might hire a Blog Writer.
Or if you need to design a new website and would rather spend your time elsewhere than learning the ins and outs of ShowIt, you might hire a Website Designer.
The options are quite literally endless and that’s the beauty of independent contractors.
The difference between hiring a team member and hiring an independent contractor is that contractors operate as their own business – meaning, they pay their own taxes, are responsible for their own benefits, and typically have more control over how they execute their work.
Additionally, they usually set their own hours, use their own tools and equipment, and typically work for multiple clients simultaneously.
All of these things can come as a HUGE advantage to you as the person hiring a contractor, because you can receive the service you need without having to fully manage another person.
Instead, you agree to the service offerings, pay for what you need, and get to stay in your zone of genius.
While hiring an independent contractor can be amazing, it’s important that you also take the correct measures to protect your business as you bring them into your world.
And the way you do that is of course by having the correct contracts in place!
5 Hardest Working Clauses In Your Independent Contractor Agreements
A well-crafted contract spells out the exact tasks, deliverables and responsibilities of the independent contractor, which ensures that everyone is aligned on what is expected.
When you have this defined, you’re able to minimize misunderstandings, avoid scope creep and keep all of your boundaries intact!
In addition to the scope of work details, the contract should also outline how much will be paid, when the payments are due and under what conditions.
This section of your contract provides a clear financial roadmap for both parties, reducing the chances of payment disputes.
If you’re working with a contractor on a project basis, it’s important to include the specificities of the timeline of the project, including a start and end date, as well as any important project milestones.
These details will help with planning and ensure that time-sensitive tasks are completed as expected.
If you plan to be working with a contractor for an extended period of time with no designated end date, you want to make sure you include any information about how either party can exit the agreement if needed and how that needs to be navigated.
One of the reasons that outsourcing can feel scary as a business owner is because you want to know that the work being done is being done well and it can often feel like you are the only one capable of that.
If you can relate to feeling that way, I want to first encourage you to trust that there are professionals out there who can do certain work wayyyyy better than you can!
And no, that’s not a knock on your skills. Just like you have specific expertise in your field, so do they!
But also know that your contract can specify quality standards or project milestones that must be met for payment to be released.
This provides an avenue for you to hold the contractor accountable for the quality of work and make sure that it meets your standards before ever being presented to your audience!
This alone can give you a TON of peace of mind when it comes to outsourcing in your business.
One of the biggest questions that comes up for business owners hiring independent contractors is, “who owns the deliverables?”
And it’s a great question! This is why having an intellectual property rights clause in your contract is so key.
This part of your contract is especially important for creative or technical tasks that someone will be doing for you, such as content creation, video editing, etc.
The contract should always stipulate who owns the finished work and any intellectual property generated to prevent future disputes over ownership and usage rights.
How To Implement Independent Contractor Agreements In Your Business
Overall, having the correct Independent Contractor Agreements in place is like having an insurance policy for your business.
It minimizes risks, sets clear expectations, and safeguards your business interests. With this agreement, you ensure compliance with labor laws, protect your intellectual property, and maintain professional relationships with clear communication.
So, if you’re planning to outsource with contractors, make sure you have a contract in place with all of these clauses included FIRST!
To make it easy for you, I’ve created a fill in the blank contract specifically designed for independent contractors that you can use in your business just in case you don’t want to piece one together yourself.
This customizable agreement template ensures both parties are on the same page about important terms, conditions and expectations by covering all of the essential aspects of the relationship!
With this contract in place, you can outsource confidently and trust that your business is legally backed along the way. 👏🏼
P.S. Are you an independent contractor looking for a client agreement to also protect YOUR business? This one’s for you!