This checklist is essential for anybody who is considering outsourcing work to an
independent contractor. It describes important elements of a legal agreement, including
job requirements and scope, timeline for deliverables, responsibility for materials,
measurement of completion, compensation, and governance. This document in its draft
form contains numerous of the standard clauses commonly used in these types of
forms; however, additional language may easily be added. Small businesses or
individuals should use this form if they are considering outsourcing work to an
independent contractor
OVERVIEW FOR CONTRACTORS
Independent contractors perform a variety of services on an outsourced basis for business of all
types and sizes. When being engaged by a client, you should take the time to ensure that both
you and your client are clear on the details of the project(s), time-line for delivery of services,
and compensation. Use this checklist to ensure that the agreement between you and your client is
clear, fair, and equitable for both parties.
PARTIES TO THE AGREEMENT
The full legal names of the parties to the agreement should be included here.
Contractor Contact Information
(The Independent Contractor may be an unincorporated sole proprietor or may be
incorporated. Use the formal legal name to which payment will be made.)
County/State/Country of Contractor
Client Contact Information
State/Country of Client
Verification of non-employee status
JOB REQUIREMENTS
This section forms the core of the agreement, and lays out the specifics of the work that is being
outsourced, how it will be performed and over what time-frame.
Understanding & Scope
Statement of Client Business
(Brief description of the client’s business and the reason for engaging contractor.)
Statement of Contractor Business
(Brief description of Contractor’s business and qualifications for the work assignment.)
Description of the work to be performed
(Brief description of the kind of services to be provided, e.g. programming, development,
human resources management, logistics, website management, data entry, customer
support, etc.)
Specific tasks necessary to providing deliverables
(e.g., meetings, research, interviews, programming, analysis, calculations, build-out, etc.)
List of activities outside the scope of the agreement/project
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Start Date/Completion Date
The date upon which work commences
Anticipated final delivery, or completion date
Deliverables
List of Key deliverables
Draft or incremental portions of deliverables
Provision for changes to deliverables
Time-line for Delivery
Milestone dates
(Deliverables due-dates, plus other key dates, such as project kickoff.)
Interim dates
(Include status reports, meetings, deadlines for approving deliverables, etc.)
Materials & Supplies
Materials and supplies to be provided by the contractor
Materials and supplies to be provided by the client
Measurement
Method of measuring delivery
(e.g., will contractor be evaluated on lines of code, number of pages per document, % of
errors per XX keystrokes, etc.)
Status Reporting and frequency
COMPENSATION & PAYMENT
Type of Compensation
Fixed fee, hourly or retainer
Currency for transactions
(Important if contractor and client are located in different countries.)
Frequency of Compensation
Deposit, Interim payment(s), final payment
Invoicing and payment on weekly, biweekly, monthly basis
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Method of Payment
Check, Wire Transfer or Secure online payment (e.g. PayPal, third-party sites, etc.)
Payment of associated fees
Tax responsibility (e.g., taxes to be paid by contractor on 1099 basis.)
Related Expenses
Travel reimbursement
Supplies/materials reimbursement
PENALTIES & INCENTIVES
This section describes penalties for failing to comply with the time-line for delivery, the type and
quality of delivery (from the contractor), requirements for timely review and approval and
payment (from the client). The section can also include any incentives for exceeding quality
requirements, or early delivery, or discounts provided to the client.
Late delivery penalties
Late payment penalties
Incentives
Cash or early payment discounts
GOVERNANCE
This section describes how the agreement will be enforced, including responsibilities of both
parties, and the jurisdiction in which the agreement is made.
Modifications
(How can contractor or client modify the agreement?)
Termination
(What happens when the contract terminates; can either terminate early with notice; are
there penalties for terminating early?)
Indemnification
(The contractor cannot blame or hold the client liable for the contractor’s mistakes,
negligence, or breach of the agreement.)
Representation
(Both Contractor and Client have not made representations or promises to other parties
with regard to the contract; only the terms of the agreement are binding on both parties.)
Dispute Resolution
(What happens in case of a dispute over the work? Will both parties go to binding
arbitration or court? Mediation? Who will pay for any of these methods of dispute
resolution forums? How will notice be served?)
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Governing Authority
(What country, state/province, and/or municipality governs the terms of the contract?)
Containment
(The written agreement contains the entirety of the obligations for both the contractor and
the client.)
SIGNATURES
Printed Independent contractor Name, Title
Independent Contractor’s Signature and Date
Printed Client Name, Representative, Title
Client Representative’s Signature and Date
RELATED REQUIREMENTS & FORMS
Non-disclosure / Confidentiality agreement
Often, the independent contractor performs work for the client that involves access to propriety
information about the client’s organization, finances, research and development efforts, and other
information which, if made public, could damage the client. Non-disclosure or confidentiality
clauses may be part of the outsourcing agreement, but the client may also have you as the
contractor sign an NDA or CA prior to commencing work.
Non-disclosure agreement
Proof of Ability and Capability to Perform
Clients often want confirmation of your legal ability to perform the work outlined in the
agreement
Taxpayer Identification Number
(For individuals, this is Social Security Number (SSN). For incorporated companies this
is the Employer Identification Number (EIN)).
Business License
Certificate of Insurance
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