Independent contractor can be any sole proprietor, company or firm that provides services or goods to any of its client. Client can also vary in its form from a natural person to a public or private limited company. There are various modes whereby companies operate their businesses. Sometimes independent contractors are hired by companies to perform certain services. Terms and conditions are agreed upon prior to formally entering into the agreement. Hiring of independent contractor must be handled with great care because of the prevalence of fraudulent activities in the market. Many a time fake contractors take the consignment and huge loss is incurred by the companies resultantly. So it is wise to carefully scrutinize the credentials of the contractor before entering into the agreement.
Contractor can be hired for short term or long term basis depending upon the nature of service being provided by him and the requirements of the company hiring him. So after selecting the right candidate as a contractor for completion of the task, next step is to draft an independent contractor agreement. There are two kinds of agreement: verbal and written. Verbal agreements are most prevalent between parties having tremendous amount of trust between them and engage in business frequently. But the situation isn’t always ideal. So written agreements have to be drafted for legal protection in case of any breach of the agreed terms. Utmost care needs to be taken while drafting an agreement. Because in case of any unforeseen event, only this document can save a company hiring the contractor or the contractor from huge losses. It guarantees the proper disposal of the agreement within stipulated time period and agreed quality. Even this task of drafting the agreement can either be taken up by the company itself or outsourced to a firm that specializes in drafting the agreements of various kinds. Sample agreements are also available online that can be altered a little bit according to the requirements. But it is advisable to contact a specialist in this field.
Here is preview of a Free Sample Independent Contractor Agreement Template created using MS Word,
Moreover some of the terms that must be made a part of this independent contractor agreement are:
- A complete detail of the work that has to be done by the independent contractor, this can include both services and goods.
- A complete specification of the fee that independent contractor will charge and that you have agreed to pay him. Payment can be either fixed or based on the number of units completed or on the basis of time i.e weeks, days or hours.
- The mode of payment to the independent contractor must also be included in the agreement.
- The description about provision of equipment and materials must also be entered in the agreement.
- A statement of agreement between both parties i.e the company and independent contractor should also be made a part of the agreement.
- A statement regarding the permission given to independent contractor to pursue the work assigned to him must be written in the agreement.
- Also the time frame for which this agreement is valid must be contained in the agreement. And the mode of resolving the disputes, if any, should also be added in the agreement to avoid difficulty later on.
This is the general pattern on which an independent contractor agreement can be made. But other terms can also be added in to make it more fool proof.