independent contractor agreement template

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Independent Contractor Agreement

This Independent Contractor Agreement template is intended to be used to clearly articulate and establish the terms and conditions of a contract between your company and an independent contractor.

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Overview

If you’re searching for an Independent Contractor Agreement template, chances are you're planning to hire your first independent contractor. Congratulations! We share your excitement in taking this first step!

There are multi fold advantages to using Independent Contractors such as short-term project specific expertise and cost savings as contractors are not provided with benefits such as medical and vacation leaves. However, be aware that tax regulators in most countries have strict assessment on the definition of independent contractors. It will cost your company money and, in some cases, damaged reputation if your independent contractor is reclassified as an employee by the taxman.

The first step is to put in place an Independent Contractor Agreement before services are provided. We strongly recommend using your own Agreement instead of one provided by the contractor. This is to ensure your company’s legal position is protected and that it’s a fair contract for both parties.

An Independent Contactor Agreement spells out clearly the status of the relationship (i.e. non-employee), services provided, fees, duration of contract, contract termination obligations for both parties and expected code of conduct, among others. The Agreement makes it very clear that this is strictly an independent contractor relationship (very important!) and is written in simple language that’s easily understood and interpreted. To reduce the work in preparing the Agreement, we have put together an Employment Offer Form. The offer form is an internal template that is provided to hiring managers and other stakeholders to fill out and submit to HR. The form contains pertinent information such as fees/compensation, list of services provided and contract start and end dates. All you need to do is transpose/copy the information in the Offer Form to the relevant placeholders in the Independent Contractor Agreement. Review the Contractor Agreement one final time and you’re done!

How is the Independent Contractor Agreement used?

If you are using the Employment Offer Form to prepare the Indepedent Contractor Agreement, ensure all details required for preparation of the Contractor Agreement has been provided in the Offer Form. This is an important step as the Offer Form needs to be approved before preparing the Contractor Agreement. 

Once the Indepedent Contractor Agreement has been modified:

  • Review all edits made to ensure legal compliance.
  • If major changes need to be made to some clauses, use your discretion to decide if legal review is required. 
  • Human Resources to send the Independent Contractor Agreement to the contractor for review and accpetance before services are provided.
  • Allow for some buffer time for contracts to be negotiated. To save time, put together a list of items that the contractors wants negotiated and schedule a meeting with the decision maker in your company to go over the list. Avoid the back and forth via emails. Swift handling of the negotiation will increase the chances of contract acceptance.    

Why use an Independent Contractor Agreement?

Clearly articulating  contract terms and conditions, and requesting confirmation that the contractor understands and signs off on them:

  • Outlines what's expected from each party during the term of the contract and what will happen once you part ways. 
  • Ensures that the Contractor understands the scope of work and what's expected of them.
  • Ensures that the Contractor understands what they can expect from your company.
  • Ensures that the terms & conditions are in writing so there are no misunderstandings.  The agreement clearly indicates that any oral promises or previous arrangements are nul and void once the employee signs the contract. The parties often forget what they agreed upon and having your terms in writing is critical. 
  • Contractors are much more likely to deliver on projects and scope of work when they've signed an agreement.
  • Helps to ensure protection of your company. If the relationship ends in litigation, you'll have a much better chance in court if you have your terms and conditions clearly laid out. 
  • If used in conjunction with Staff Policies Manual and Terms & Definitions documents, you'll be clearly articulating conduct policies and expectations before the contractor is hired that provides another layer of protection for your company.  See how all 3 documents fit together
  • Protects against a Dependent Contractor claim. 

What you risk by not using an Independent Contractor Agreement?

  • You have limited recourse in the event that the contractor's behavior/performance does not meet expectations.
  • Consequences for misconduct are not clearly articulated.  
  • Your company confidential information and intellectual property is at risk.

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Contracts & Agreement Templates in this Kit

The template referenced on this page can be used on its own as a stand-alone tool, or in conjunction with other HR templates in the Contracts & Agreement Kit that includes the following documents:

Template Description

Offer Form Template

This form template ensures that all information about a candidate and position is collected and summarized, so that HR has the information they need to process an employment or independent contractor agreement.

Employment Contract Agreement Template

A contractual agreement template between the company and the employee that establishes the terms and conditions of employment.

Independent Contractor Agreement Template

This agreement template is intended to be used to clearly articulate and establish the terms and conditions of a contract between your company and an independent contractor.

Staff Policies Manual - Addendum to Employment Contract

An addendum document that outlines the standard terms of employment and conduct expectations where signature for adherence by the candidate is obtained as part of the Employment Contract Agreement and Independent Contractor Agreement documents.

Terms & Definitions - Addendum to Staff Policies Manual

An addendum document that provides definitions for the formal terms used in the Staff Policies Manual above.  

Overtime Averaging Agreement Template

A contractual agreement between an employee and your company allows you to bypass overtime rates by averaging the employee’s hours of work over a period of 1, 2, 3, or 4 weeks. 

Employee Handbook Acknowledgment Agreement Template

This is a contract agreement that is signed by Staff, in the presence of a witness, to acknowledge that they've read, understood, and will adhere to the Staff Policies section in your Employee Handbook.

Front Desk Service Agreement Template

An agreement used to obtain signed confirmation from front line and reception staff to acknowledge their understanding of company protocols and expected service levels. 

Involuntary Termination Authorization Form Template

This document is a template spreadsheet that will help your company calculate the costs associated with terminating an employee, and to obtain authorization to terminate. 

Non-Disclosure Agreement for Exploratory Discussions Template This template agreement is intended to be used to protect the interests of your company in situations where company-confidential information may be shared during exploratory discussions with prospective candidates.
Reference Check Request & Consent Template This document is a template for an email script used to obtain reference provider names and written consent from candidates to conduct reference checks.
Training Reimbursement Agreement Template A template for a contractual Agreement between your company and an employee embarking on a training initiative that exceeds a company-determined cost ceiling, where your company is expecting the training expenses to be reimbursed by the employee in certain scenarios.
Delegate Confidentiality Agreement Template This document contains instructions and a script for a conduct agreement between a manager and administrative-level staff. The script can be used when a manager needs to delegate work that may require access to sensitive or confidential information.