How to Secure Your Contracts When Hiring Freelancers
How to Secure Your Contracts When Hiring Freelancers
According to recent data from 2022, there are roughly 70.4 million US freelancers. This equates to 36% of the American workforce participating in freelance roles. Compared to data from 2021-2022, this is an increase of more than 20%.
With freelance and remote work on the rise, your company might be looking for qualified individuals who can complete the job of a permanent employee, but temporarily.
If you’re interested in hiring freelancers, then you need an employment contract to protect your business and any freelance workers you onboard. However, you might be wondering what to include in your freelance contract for the protection of both parties.
This helpful guide explains the best way to prepare a contract for a temporary worker so you’re prepared to work with an array of freelancers in any role. Keep reading to learn more.
1. Personal Information
Every contract you draft should include your company name along with the freelancer’s name (or company name). You should include your personal information along with the freelancers, including email addresses, contact numbers, and physical addresses.
When you use a legal name and other professional contact information, it shows freelancers that you’re entering into a professional business agreement and aren’t operating as friends.
Be sure to include information for the person(s) serving as the freelancer’s point of contact. When there is a primary contact listed, the freelancer knows who to ask questions to, streamlining work production.
2. Describe the Scope of Work
The contract should include the scope of work and a brief project overview. Include the work provided by the freelancer and specific details about the project description.
Outline the precise working terms of the contract and the freelancer’s expectations. Use clear, concise language and include the following:
- Project start date
- Project end date
- Overall timeline to complete the project
- Describe the services provided
- Terms of payment, including rate and schedule
If you’re planning on paying a freelancer monthly, for example, be sure to state it in your contract.
3. Services Offered
When creating a contract, services offered – also called deliverables – must be listed. Services offered are completed throughout the project’s timeline, at various intervals. The final product is also a deliverable; your contract must state this.
If your project has milestones, outline them in your contract. List when each deliverable must be produced by, and explain that they must be available in draft format for you to review.
Deliverables allow you to effectively communicate expectations to a freelancer. Without deliverables, you and a freelancer might enter into a project with vastly different ideas about the final outcome. Deliverables work to keep you both on the same page.
4. Project Deadlines
Project deadlines are just as important as deliverables. Since deliverables are milestones within a project, having a concrete deadline allows you to set deliverables that adhere to the project’s needs.
Freelancers should account for prospective time off and how long they reasonably expect a project to take them to complete. Take edits and revisions into consideration, depending on how quickly the freelancer can send you a first draft and what your company’s turnaround time is for making any edits or revisions.
5. Intellectual Property Rights
Intellectual property rights must be addressed when creating a contract after hiring a freelancer. The contract needs to include two specific components about intellectual property.
First, state that you (the client) have explicit rights to any and all material that you pay for. Next, you’ll need your contract to state that the freelancer retains the rights to any and all material they’ve created that you don’t pay for.
Be clear on this part of the contract to avoid any miscommunication down the road.
6. Terms of Payments
As previously mentioned, your contract needs to discuss the terms of payment. When creating this part of your contract clause, you’ll need to consider several factors.
First, decide what you’ll pay your freelancer. Is this an hourly fee or a flat rate per project milestone? Will the fee revolve around a minimum or maximum number of hours worked?
Decide on your payment schedule and whether you need the freelancer to submit an invoice by milestone or one invoice for the entire project. You need to consider if you’ll give the freelancer a deposit before they begin work, if you’ll reimburse the freelancer for expenses related to the project, and various payment methods. This might include PayPal, cash, wire transfers, and more.
7. Include a Termination Clause
A termination clause gives both parties the ability to cancel the contract. There may be issues either side of the party experiences, including the inability to meet deadlines, lack of communication, or disagreements about deliverables.
Discuss under what circumstances a contract can be canceled, if there are any fees for work already begun, how much notice each party needs to cancel the contract, and how they can go about canceling it.
Follow These Contract Guidelines When Hiring Freelancers
When hiring freelancers, always have a contract prepared before they begin work. A contract is a written record of rights, obligations, and responsibilities, and protects both parties. Contracts formalize relationships and ensure you receive the work you’re paying for.
Contracts also protect both parties from possible lawsuits, which can result in stressful, costly expenditures. However, when you and a freelancer have clear, concise language that explicitly details the scope of work and expectations, there’s little room for confusion.
Bradford Jacobs helps you attract, hire, and retain top remote talent for your company, regardless of where they’re located. Contact us today to get started.