Create a Clear and Fair Independent Contractor Agreement
Use our free template to set expectations, avoid disputes, and protect both parties in freelance or consulting work.
Whether you're hiring a designer, writer, developer, or any kind of freelancer, a simple independent contractor agreement helps prevent misunderstandings. It lays out what the contractor will do, when they'll do it, and how they'll get paid.
Our downloadable agreement template makes it easy to get started, even if you’ve never hired a contractor before.
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Table of Contents
What is an Independent Contractor Agreement?
An independent contractor agreement is a legal document between a client and a self-employed worker (or business) that outlines the terms of a project or service.
Unlike an employee, a contractor works independently, controls how they do the work, and is responsible for their own taxes and benefits. This agreement helps define the relationship, the scope of work, deadlines, payment terms, and confidentiality requirements—if any.
It’s especially important because misclassifying contractors as employees can lead to legal and tax issues for both parties. A written agreement helps clarify roles from the start.
When is an Independent Contractor Agreement Needed?
This document is useful for both sides. Contractors can use it to protect their rights and ensure they’ll be paid. Clients can use it to confirm expectations and avoid legal risk.
What Happens If You Don’t Use One?
There’s no written record of the work expected or payment terms
Disputes about timelines, revisions, or deliverables are harder to resolve
Either party might walk away early without legal consequence
You may be at risk of misclassifying the contractor and violating labor laws
How to Fill Out an Independent Contractor Agreement
Filling out this document is easier than it sounds. You’ll just need to include:
- Step 1: Names and Contact Information
Identify both the hiring party (client) and the contractor.
- Step 2: Project Scope or Description of Services
Clearly describe what the contractor is expected to do. Be specific
- Step 3: Compensation and Payment Terms
State the fee, payment schedule, whether it’s hourly or fixed, and how payment will be made.
- Step 4: Timeline or Deadline
Include key dates for deliverables, milestones, or project completion.
- Step 5: Independent Status
Confirm that the contractor is not an employee and is responsible for their own taxes and insurance.
- Step 6: Ownership and Intellectual Property
Clarify whether the client or contractor owns the finished work.
- Step 7: Confidentiality and Non-Disclosure (if needed)
Include any requirements to keep client info private.
- Step 8: Termination Clause
Outline how and when either party can end the agreement.
- Step 9: Signatures
Have both parties sign and date the agreement.
Our downloadable template walks you through each section and allows for easy customization.
Common Mistakes to Avoid
- Leaving Out the Scope of Work
This is the #1 source of disputes. Be clear about what’s included—and what’s not.
- Not Setting Deadlines
Without firm timelines, delays are harder to address.
- Ignoring Ownership of Work
If it’s not specified, the contractor may retain rights to the work—creating issues if you want to use it commercially.
- Forgetting Tax or Classification Language
Make sure the agreement confirms the contractor is not an employee, or you could be liable for employment taxes or penalties.
- Missing Signature Page
No matter how well-written, an unsigned agreement may not be enforceable. Always sign and keep a copy.
Related Documents
You may also want to consider:
- Service Agreement
Similar in structure, but sometimes used for more traditional business-to-business services
- Non-Disclosure Agreement (NDA)
If the contractor will access sensitive or confidential information
- Scope of Work (SOW)
A detailed add-on that can provide more technical or deliverable-specific detail
- Payment Agreement
Useful if paying in installments or with a delayed schedule
- Invoice Template
For contractors to submit payment requests
These can all be used in combination with your contractor agreement to provide a more complete and professional engagement.
Frequently asked questions
Is this agreement legally binding?
Yes. Once signed by both parties, it becomes a legal contract enforceable by law.
Do I need to hire a lawyer to use this?
No. Our template is written in plain language and can be filled out by anyone. However, for complex or high-value projects, a lawyer's review might be helpful.
How is this different from an employment contract?
An independent contractor is not an employee. They don't receive benefits, tax withholding, or supervision like a regular employee would. This agreement reflects that independent relationship.
Can I use this if I'm hiring someone from another state or country?
Yes, but laws vary by location—especially for international hires. Make sure you understand local labor laws, and consider adding clauses for currency, time zones, and governing law.
What happens if the contractor doesn't finish the work?
The agreement should include a termination clause and outline how disputes will be handled. A signed contract gives you legal grounds to withhold payment or take further action.
Can I end the contract early?
Yes—if your agreement includes a termination clause. You should state whether notice is required and how final payments or unfinished work will be handled.
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