Independent contractor work comes in many shapes and sizes. From business owners to individual freelancers, having a set agreement can increase credibility and make a project run more smoothly.
What is an independent contractor?
Independent contractors (ICs) are different from employees. The key difference is who has the right to control the project. In general, employees do not have the freedom to determine the method or the means of a project. Instead, employers control when, where, and how the work gets done. Employers decide what time the employee comes to work and what time the employee leaves. Employees typically work on the employer's property and use the employer's materials. However, being an employee also has perks - employers pay a salary, take care of tax withholding, and provide benefits such as healthcare and retirement plans.
The relationship between ICs and the people who hire them (sometimes called "payers") is totally different. For example, the relationship is typically short term, just for the length of a given project. Payers get to determine the end result of the work (i.e. a new sound system installed into a theater). However, ICs control the the actual process; what tasks get done, where, and how. ICs usually provide their own supplies and materials. ICs are business owners or individual freelancers who pay self-employment tax and do not receive benefits.
Why have a contract?
ICs in the Arts & Entertainment industry may wonder if having a contract makes sense. It is not unheard of for agreements to be informal (i.e. a handshake or an oral promise). Some ICs primarily work for friends or people they already know. In an industry where relationships are everything, having a contract can sometimes feel awkward.
Nevertheless, contracts can be crucial for success. Informal agreements may lead to misunderstandings which sour relationships and undermine reputation. A good contract can increase credibility and cause clients to take the IC more seriously. Clearly laying out the scope of a project in writing helps to avoid mission creep and misunderstanding. Importantly, contracts establish up-front how much the IC is going to be paid. While it may seem awkward at first, a well-written contract can actually give both parties more assurance and clarity.
About Bevel Law
Bevel Law is a Washington, D.C. law firm that caters to creatives and their unique needs. The Firm offers transparent pricing and intuitive services to help clients achieve their goals. Need help with a contract? Book a call today.
This information is not legal advice. Each person's situation is different and highly fact-specific. Readers should seek legal advice from an attorney before taking action regarding the topics discussed in this blog.