Independent contractor agreement
IN PLAIN ENGLISH

Describes the services you're being hired to provide. This can be highly specific (e.g., "deliver a redesigned checkout flow for the iOS app by March 15") or frustratingly vague ("provide consulting services as requested"). The clearer the scope, the easier it is to know when you're done and to push back on scope creep. If the scope is open-ended, expect the engagement to expand without a corresponding change in pay unless you negotiate otherwise.

Specifies how long the engagement lasts and how either party can end it. Many contractor agreements are terminable "at will" with short notice (often 14 or 30 days). Some have a fixed term with renewal provisions. Pay attention to whether termination requires cause, whether there's a kill fee if the project is canceled early, and what happens to unpaid invoices.

The rate — hourly, daily, project-based, or retainer — and when you get paid. Net-30 (payment within 30 days of invoice) is standard; Net-60 or longer tilts in the company's favor. Some agreements tie payment to milestones or deliverables rather than time. Watch for language that conditions payment on client "acceptance" of work without defining what acceptance means.

Whether the client reimburses out-of-pocket expenses (travel, software, materials) and under what conditions. Many agreements require pre-approval for anything over a threshold. If you're expected to spend money to do the work, make sure reimbursement terms are clear.

A recitation that you are an independent contractor, not an employee, and that the agreement doesn't create an employment relationship. This paragraph doesn't actually determine your legal status — that's based on the real-world facts of the relationship — but it signals the company's intent and becomes relevant if classification is ever disputed.

A reminder that you're responsible for your own taxes (including self-employment tax), health insurance, retirement savings, and any other benefits. The company won't withhold income tax, pay the employer share of FICA, or provide workers' comp. If you're new to contracting, budget for quarterly estimated tax payments and the 15.3% self-employment hit.

Specifies who owns the work product. Most contractor agreements assign all IP you create during the engagement to the client — code, designs, writing, inventions — often phrased as "work made for hire" (even though the legal definition of that term doesn't always apply to contractors). Some agreements go further and require you to assign IP you created before the engagement or on your own time, which is overreach. If you have prior work you're bringing into the project, carve it out explicitly.

A promise not to disclose the client's confidential information — trade secrets, business plans, customer data, financials — during and after the engagement. Standard language is mutual (they also keep your information confidential), but not always. Pay attention to how long confidentiality lasts (often indefinite), what counts as confidential, and whether there's a carve-out for information you already knew or that becomes public.

Some contractor agreements include restrictions on working for competitors or soliciting the client's employees or customers. These are the same clauses you'd see in an employment agreement, but their enforceability for contractors varies — courts in some states are more skeptical of non-competes imposed on people who aren't even employees. Read the scope carefully.

A promise to defend and pay for any claims arising from your work — for example, if a third party sues the client claiming your deliverables infringed their copyright. Indemnification clauses can be one-sided (you indemnify the client but not vice versa) and unlimited in dollar terms. If you're a solo contractor, unlimited indemnity is a real risk. Push for mutual indemnification and a cap tied to the contract value.

A cap on how much either party can recover from the other if something goes wrong. Typical language excludes consequential damages (lost profits, lost data) and caps direct damages at the fees paid under the agreement. This protects you as much as the client, assuming it's mutual.

A requirement that you carry professional liability (E&O), general liability, or other insurance. Enterprise clients often require $1M+ in coverage and want to be listed as an additional insured. If you don't already have coverage, factor the cost into your rate.

Statements you're making about yourself and your work: that you have the right to enter the agreement, that your work won't infringe third-party rights, that you'll perform the services professionally. These are generally reasonable, but read them — if you're being asked to warrant things you can't actually guarantee, push back.