More and more companies are relying on independent contractors to save costs, get the work done fast and with perfection. It’s much easier to hire an outside resource without any hassle or use an employee contract where you might be liable to bear the pension or medical expenses of the employees. The need for a formal independent contractor contract is no less for businesses hiring independent consultants or contractors.

Whether you are a contractor or freelancing individual that works on short-term or on-off contracts or projects with clients, you should always make a formal independent contractor agreement with terms agreeable to the other party and get it signed before commencing work.

While hiring people for your contractual requirements, please define their scope of service, terms of payment and deliverable schedule through formal and legally bound consulting contracts. This will ensure both parties conduct their business without any confusion, problems or unreal expectations.

These days, independent contractors and clients can find a suitably modifiable and professional contractor agreement template online easily for their business needs. You do not need to pay fees and follow up with a legal expert to draft a contract for you to use.

When looking for independent contractor agreement templates, choose the ones written by legal experts as they will have clauses in the contract to protect your interest as a party.

Independent Contractor Agreement

An independent contractor agreement is a legally binding, formal agreement entered into between an independent contractor (freelancer) and a client(company) for the contract services desired.

The contractor contract template provides details to both parties about contract scope, deliverables, timelines set by both parties with regards to information, resource requirements, payment terms, schedule and limitations in case of any unfortunate event.

An independent contractor or a freelancer can be employed by a client company or an individual client for a single job, short term repetitive work or on a long-term cooperation depending on the contract needs.

Often, the need for an independent contractor is on-going whereas in other cases, it may only be needed once. Irrespective of the requirements, a legally binding contract ensures completion of work in desired budget, ensures timely and agreed upon payment to the worker.

What Is an Independent Contractor Agreement?

An independent contractor agreement often referred to as the freelance agreement or the free independent contractor contract is a mutually agreeable set of conditions signed by the contractor and the paying client.

The contractor agreement will generally define who the hirer and hiree is, the contract term, the payments to be made, the details of the work to be done and the requirement or permissions needed to complete the work.

You must work through the independent contractor agreements written by the professional lawyers only. These general contract templates are usually available free of charge or at a nominal charge through popular contract template providers online like CocoSign.

When to Use an Independent Contractor Agreement?

An independent contractor agreement should always be used for any work in a non employer-employee relationship irrespective of the type of work or its duration to ensure quality work and timely payment.

So if you want to hire an independent contractor to save costs or get work done quickly from an expert instead of an employee use a formal independent contractor agreement template. The contract should categorically state that the person hired is not an employee and hence can be paid wages and benefits in accordance to the 1099 contract only.

Differences Between a Contractor and an Employee: Who Should You Hire?

A contractor works on an as needed basis both in the short-term or the long term without any pension and medical benefits. An employee on the other hand is a regular staff entitled to certain leaves, pension and medical benefits. People usually hire independent contractors because of their expertise, short term need or to save costs.

If your requirement is short-term or on an as-needed basis, you should hire an independent contractor against keeping regular employees and bear additional costs. Another advantage with independent contractors is that you can cancel their contract easily with some prior notice if they are not available consistently or are not performing up to your expectation.

But, if you need work to be done on premise for long-term or require people to access sensitive data, it is advisable to hire employees to work for you rather than contractors. This way, you can ensure they are available regularly and in a manner conducive to organisational work ethics.

These days, independent contractor agreements that are available online are written carefully by legal experts to ensure you are legally protected against any long-term liabilities as the paying party.

On the other hand, these contractor agreements also have clauses to protect the payment interests of the freelancer or contractor. If they have submitted their work in time, as per expectation and desire, you are liable to be paid without further delay or hassle in the previously agreed payment period.

Consequences of Not Using an Independent Contractor Agreement

An independent contractor agreement template legally outlines all the elements of a standard contract like service and payment details, names and addresses of signing parties, cancellation fee, benefits, waivers, indemnification clause, governing laws, warranties and so on. In addition, it also defines the limitations of the service buyer and seller against unrealistic expectations.

It additionally also lists clauses that define that it cannot be considered as a regular employee contract and saves the hirer from unnecessary legal hurdles related to the demand of any kind of employee benefits. If you are not working through an independent contractor agreement, you might risk losing your company details, sensitive data, intellectually protected information or unauthorized access to your premises, products, services or business platform.

If you do not work through a formal contractor agreement as a worker, you risk not being paid on time or losing your payment entirely. In short, service buyers risk their reputation and may have to bear financial loss if they do not hire a freelancer through the free independent contractor agreement document.

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FAQs

Are free independent contractor agreement templates legally binding?

Yes, the formal contractor agreements that are written by expert lawyers are legally binding for both the service buyer and the service seller.

Can a free independent contractor agreement be used as a regular employee contract?

No, the independent contractor agreement is not a substitute of an employee contract since the objective of both, the scope of work, binding clauses etc. are all different from each other.

Can I modify an independent contractor agreement to my requirement?

Yes, you can easily add, edit or delete the standard template text of an independent contractor agreement to suit your specific work requirement.

How to get a draft independent contractor agreement signed by the other party?

You can easily use an electronic signing service to get your contract signed by the other party fee of cost. All you have to do is to sign up for the service, upload the document, add your signature and details there, and send it from the signing software itself for the other party to sign.

Once the other party has signed it using his or her email account, the document is automatically filed in your electronic signature account for future reference.

Can the independent contractor agreement be used for repair, replacement or equipment services?

An independent contractor agreement can be used for any non-employee type of contract services such as repair, consultation, modifications, installations or other tasks that you or the business needs to perform.

So, if you are looking to get work done from someone that you cannot do yourself or ask people in your company as a business owner because the costs associated with either of these are high, then you can hire a third party contractor to get it done.

However, you should always remember to work through independent contractor agreement templates that are freely available online for anyone to use after editing and adding their information.

CocoSign has numerous templates AVAILABLE for independent contractor agreement documents. Do check out and download the one that best fits your contract requirement. Our contract templates are easy to download, edit and sign and have been popular throughout the world for protecting the interests of all signing parties in a legal and fair manner.

Disclaimer

CocoSign represents a wide collection of legal templates covering all types of leases, contracts and agreements for personal and commercial use. All legal templates available on CocoSign shall not be considered as attorney-client advice. Meanwhile, CocoSign shall not be responsible for the examination or evaluation of reviews, recommendations, services, etc. posted by parties other than CocoSign itself on its platform.