As a remote contractor, you are assured of flexibility and the freedom to choose where and how you work. Another important aspect of your work is also being responsible for your business.
And one key responsibility is making sure that you write and agree on thorough and clear contracts that protect your interest.
In this guide, we’re taking you through a list of the 10 essential contract clauses for remote contractors. We’ll also give you examples on how to craft each part to protect your work.
1. The scope of work
This is the part of a contract that forms the foundation of your work. It’s where you define what you do, how you do it, and at what time. Below is what should go into this part of the contract
- Tasks and deliverables: List the specific tasks or services you will provide. The goal here is to be as detailed as possible to avoid misunderstandings.
- Timelines and milestones: Here, you should state the start and end dates of the project. Also include key milestones and deadlines for deliverables.
- Performance metrics: If applicable, specify measurable indicators like quality standards, deadlines, or output targets.
This section helps both you and your client understand expectations and avoid disputes.
Examples of clauses for a Graphic design contractor:
If you’re a graphic designer, you should specify whether you’ll create logos, banners, or complete branding kits.Include timelines like “first logo drafts or brand kits will be delivered within seven business days of contract signing.”
2. Compensation, payment, and structure
How and when you get paid is one of the most critical aspects of a contract and one of the most vital contract clauses for remote contractors. To make this as simple and easy as possible for both parties, here’s what should be included.
- Rate or fee charged: Clearly state your hourly rate, project fee, or payment per deliverable depending on the agreement or type of work.
- Terms of payment: Define when payments are due. For example, you might request 50% upfront and 50% upon completion.
- Invoices and late fees: Include details about invoicing, preferred payment methods (bank transfer, PayPal, using Arbonum etc.), and penalties for late payments.
Here are examples of well-documented payment clauses you can use to define how you want to get paid fairly and on time.
State: “The contractor will be paid $20 per hour for up to 20 hours per week.”For big projects, you might say: “A $1,000 deposit is required before work begins, with the remaining balance due upon project completion.”Add payment methods: “Payments will be made via bank transfer or Arbonum.”Include penalties: “A 5% late fee will be applied for payments delayed more than 10 days.”
3. Intellectual property
In the digital world, ownership of what you do is vital to your longevity and integrity as a contractor. Intellectual property is therefore one of the most important contract clauses for remote contractors. Who owns the work you produce?
- Ownership rights: Specify whether the client will own the rights to your work or if you retain ownership.
- Copyright: If you keep copyright ownership, outline the terms for how the client can use your work (e.g., license, duration, or specific usage).
- Work-for-hire agreements: If your work is considered a “work for hire,” ownership automatically transfers to the client.
This clause prevents disputes over intellectual property down the road.
4. Confidentiality
As a contractor, you may have access to sensitive information. Protecting this information is crucial and requires detailed contract clauses for remote contractors.
- Define confidential information: Specify what is considered confidential, such as business strategies, financial data, or client lists.
- Obligations: State that you will not disclose or use confidential information without permission.
- Returning materials: Include a requirement to return or destroy confidential information after the project ends.
Examples to help you define confidentiality in your remote contracts:
Define confidentiality: “Confidential information includes client strategies, product designs, and customer data.”Obligations: “The contractor agrees not to share or disclose confidential information with third parties.”Returning materials: “All confidential materials must be returned or deleted within five days of project completion.”
5. Independent contractor status
In many jurisdictions, an independent contractor is different from an employee. Ultimately, contract clauses for remote contractors are different from those of full-time remote employees and it’s essential to establish that in your clauses .
- Clarify your role: State that you are an independent contractor responsible for your own taxes, benefits, and expenses.
- Work methods: Emphasize that you control how and when you work, as long as your deliverables are in line with the agreed standards.
- No employee benefits: Generally, remote contractors are not entitled to a lot of benefits that full-time employees enjoy. It’s important to confirm that you’re not entitled to these benefits like health insurance or paid leave.
This clause ensures you maintain your contractor status and avoid misclassification.
6. Terms of termination
Your work with an employer would definitely not go on forever. Which is why there should be contract clauses for remote contractors whenever they start work with a new client. These termination clauses should include clear terms to protect both parties.
- Conditions for termination: Specify reasons either party can end the contract, such as breach of agreement or project delays.
- Notice period: Include how much notice must be given, such as two weeks or one month.
- Unfinished work: Outline what happens to incomplete work, payments, and intellectual property upon termination.
7. Dispute resolution
Differences in opinions, incoherencies, and a lot of other disagreements may lead to conflicts. Here are three main ways to include clauses in your contract that will help resolve these disputes when they arise.
- Resolution methods: Mention whether disputes will be settled through mediation, arbitration, or court.
- Governing law: Specify the legal framework that applies to the contract.
- Jurisdiction: State where disputes will be resolved, such as a specific city or country.
Dispute resolution clause examples to include in your remote contract:
Mediation: “Parties agree to resolve disputes through mediation before pursuing legal action.”Arbitration: “Disputes will be settled by binding arbitration in [specific city].”Governing law: “This agreement will be governed by the laws of [state/country].”
8. Force majeure
By definition, force majeure is a legal concept that refers to unforeseeable and uncontrollable events that prevent parties from fulfilling their contractual obligations. It should be part of the contract clauses for remote contractors, to help protect both parties from liability in the event of such circumstances.
Unexpected events can disrupt projects, and this clause addresses those situations.
- Unforeseen events: List events like natural disasters, pandemics, or other emergencies that may affect your ability to work.
- Impact on deliverables: Clarify how these events will affect deadlines and project completion.
- Responsibilities: State whether you or the client are obligated to find alternative solutions during such events.
9. Insurance
We all need insurance to protect us from a lot of things, and it’s different for remote contractors. Insurance can protect you from potential risks while working. Here are 3 ways to include insurance clauses in your contract.
- Liability insurance: Specify if you are required to have coverage, such as professional liability or errors and omissions insurance.
- Coverage details: Outline the type of coverage needed and the minimum policy limits.
- Client requirements: Some clients may require proof of insurance before starting the project.
10. Governing law and jurisdiction
It’s crucial to define the legal context of your contract.
- Governing law: Specify which country’s or state’s laws will apply to the contract.
- Jurisdiction: Determine where legal disputes will be resolved.
Example of clauses that cover governing law and jurisdiction that remote contractors can use:
Governing law: “This agreement will be governed by the laws of California, USA.”Jurisdiction: “Any disputes will be resolved in the courts of Los Angeles County.”
Conclusion: simplify your international contractor management
Managing international contractors can be a complex task (in fact it’s highly cumbersome). It requires you to navigate contracts, compliance, payroll, and payments across various countries.
Thankfully, you don’t have to reinvent the wheel.
Arbonum provides ready-made solutions that simplify the process.
With pre-existing contracts tailored to different countries, one-click payroll, multi-currency payments, and 24/7 support from HR and legal experts, Arbonum helps businesses handle global contractor management with ease.
Use Arbonum NOW