An Independent Contractor Offer Letter establishes the general terms of the business relationship between an independent contractor and their client. It should provide details about the scope of services and the rates the contractor charges for those services.
When to Use
Independent contractors and their clients, whether companies or individuals, benefit from an independent contractor offer letter outlining the intended work and associated rates. An offer letter template can be used to clarify terms and expectations as a basis for negotiations prior to signing a formal independent contractor agreement.
It is important to note that independent contractor offer letters differ from employment offer letters. Unlike employees, independent contractors do not work directly for an employer. Instead, they provide professional services to clients in exchange for payment.
What to Include
Your independent contractor offer letter should include the following:
- Client name and address
- Independent contractor name and address
- Date of the contract
- Services the independent contractor will provide
- Compensation, including rates, payment frequency, and invoicing requirements
- Terms of the agreement, whether it is project-based or for a specific period
- Termination clause
- Confidentiality and proprietary information handling
- Client name, title, and signature
- Independent contractor signature upon acceptance
If you engaged in previous discussions about the contract, be sure to include a paragraph that states the terms of the offer will be finalized in a separate agreement to be written after acceptance.
Classifying Independent Contractors vs. Employees
Employment classification is critical when hiring employees vs. independent contractors. A good rule of thumb when determining employment classification is to consider whether the worker is free to make their own schedule or select the work they do.
If you manage their schedule, set their work goals, and establish the terms of employment, you may benefit from using one of the following instead:
- Employment contract
- Temporary employment contract
- Permanent employment contract
- Fixed-term employment contract
Every state has different laws governing worker classification, so be sure to check your legal requirements before you sign an independent contractor agreement. If you proceed with a contractor, consider including an independent contractor nondisclosure form for workers who handle proprietary or confidential information.
Sample Independent Contractor Offer Letter
To simplify the contracting process, download this independent contractor offer letter sample in PDF or Word format and fill in your details.
Frequently Asked Questions
When hiring an independent contractor, you do not need an offer letter, but it can help you clarify the terms of the agreement before you sign a formal independent contractor agreement.
Start with an independent contractor offer letter template here. Simply fill in the details, including the names of both parties, scope of work, rates, payment terms, and legal details, and sign. You can send the offer letter by mail, email, or in person. Once the contractor signs to accept the offer letter, it is wise to follow up with a formal contract.