Key Elements of an Agreement with an Independent Contractor

If you're thinking of hiring a consultant/independent contractor, your business must have a comprehensive Independent Contractor Agreement, to mitigate liability and cost issues. A good agreement will cover the following:

The specific services to be performed

The timing when services are to be completed

When the contractor will get paid, and what conditions to payment must be satisfied (you want to ensure that you are reasonably satisfied with the contractor's work before you have to pay)

How often the contractor should report to you on his or her progress

An obligation on the part of the contractor to keep confidential the information he/she learns through working with your company

That the work being performed by the contractor is "work for hire," and that any work product of the contractor will be deemed solely owned by the company

Any warranties to be given by the contractor, such as that the work will be performed in a high quality professional manner

Check out the Forms & Agreements Center of AllBusiness.com for sample Independent Contractor forms.

In addition, you can read our Nine Tips to Create Better Contracts for guidelines that apply to your letter of intent and other crucial business agreements. Also, to cover the legal uncertainties of electronic communication, you might want to read an answer to the common question, Can an E-mail Agreement be a Binding Contract?