INDEPENDENT CONTRACTOR AGREEMENT

(the “Agreement”)

[// GUIDANCE: This form aligns with the economic realities analysis reaffirmed in DOL WHD Memo 2025-1. Update state-specific overlays (e.g., ABC tests) and document the totality of circumstances supporting contractor status.]

Document Header

This Independent Contractor Agreement is entered into as of [EFFECTIVE_DATE] (the “Effective Date”) by and between:

1. [COMPANY_NAME], a [STATE OF ORGANIZATION] [ENTITY TYPE] with its principal place of business at [ADDRESS] (“Company”); and
2. [CONTRACTOR_NAME], a [STATE OF ORGANIZATION] [ENTITY TYPE/SOLE PROPRIETOR] with its principal place of business at [ADDRESS] (“Contractor”).

Company and Contractor are sometimes referred to individually as a “Party” and collectively as the “Parties.”

Recitals
A. Company desires to engage Contractor to perform certain services on an independent contractor basis.
B. Contractor represents that it is engaged in an independently established trade or business and possesses the skill, equipment, and resources to perform the services.
C. The Parties intend to create an independent contractor relationship and comply with federal, state, and local laws.

NOW, THEREFORE, the Parties agree as follows:

Table of Contents

1. Engagement and Scope of Services
2. Relationship of the Parties
3. Compensation and Expenses
4. Intellectual Property and Deliverables
5. Compliance with Law; Classification Factors
6. Insurance and Risk Allocation
7. Confidentiality and Data Security
8. Term, Termination, and Transition
9. Dispute Resolution
10. General Provisions
11. Exhibits

1. Engagement and Scope of Services

1.1 Services. Contractor shall provide the services described in the applicable Statement of Work attached as Exhibit A (the “Services”).
1.2 Method and Means. Contractor retains discretion over the method, timing, and means of performing the Services, subject to the specifications in Exhibit A. Company may establish milestone deadlines, quality standards, and deliverable criteria.
1.3 Personnel. Contractor may engage qualified subcontractors or personnel, provided Contractor remains fully responsible and ensures compliance with this Agreement. Contractor shall provide a primary point of contact with authority to bind Contractor.

2. Relationship of the Parties

2.1 Independent Contractor Status. The Parties acknowledge that Contractor is an independent contractor and not an employee, agent, joint venturer, or partner of Company. Contractor has no authority to bind Company.
2.2 No Benefits. Contractor is ineligible for Company benefits, including health insurance, retirement, paid time off, or unemployment compensation.
2.3 Taxes. Contractor is solely responsible for all federal, state, and local taxes, including self-employment taxes. Company will issue IRS Form 1099-NEC where required.

3. Compensation and Expenses

3.1 Fees. Company shall pay Contractor the fees set forth in Exhibit A upon acceptance of deliverables or completion of milestones.
3.2 Invoices. Contractor shall submit detailed invoices including Services performed, hours or milestones, and reimbursable expenses.
3.3 Expenses. Contractor is responsible for ordinary business expenses unless Exhibit A expressly permits reimbursement. Approved expenses must be supported by receipts.
3.4 Late Payment. Amounts unpaid after [NUMBER] days accrue interest at [INTEREST_RATE], not to exceed the maximum allowed by law.

4. Intellectual Property and Deliverables

4.1 Pre-Existing Materials. Each Party retains ownership of intellectual property created prior to the Effective Date or outside the scope of the Services.
4.2 Work Product. Subject to payment in full, Contractor hereby assigns to Company all right, title, and interest in deliverables and work product created specifically for Company (the “Work Product”), excluding Contractor Tools.
4.3 Contractor Tools. Contractor retains ownership of general know-how, templates, and tools used to deliver the Services, while granting Company a perpetual, royalty-free license to the extent such materials are incorporated into the Work Product.
4.4 Moral Rights. Contractor waives any moral rights in Work Product to the extent permitted by law.
4.5 Further Assurances. Contractor shall execute documents reasonably necessary to evidence the transfer of Work Product.

5. Compliance with Law; Classification Factors

5.1 Economic Realities Factors. Contractor represents and warrants that: (a) Contractor maintains entrepreneurial opportunity (e.g., ability to negotiate fees, accept or decline engagements, and market services to others); (b) Contractor makes capital investments in tools and equipment and bears the risk of profit or loss; (c) Contractor exercises control over the manner and means of performance; (d) Contractor possesses specialized skill; (e) the working relationship is limited in duration to the project term; and (f) the Services are not integral to Company’s core business or, if they are, Contractor’s independence is otherwise supported.
5.2 State Tests. Contractor acknowledges that additional state tests (such as ABC or right-to-control standards) may apply; Exhibit B summarizes state-specific overlays.
5.3 Policies. Contractor shall comply with Company safety, security, and confidentiality policies provided they do not contradict independent contractor status.
5.4 Licenses. Contractor shall maintain all licenses and permits required to perform the Services.
5.5 Documentation. The Parties agree to document the totality of circumstances supporting independent contractor status consistent with DOL WHD Memo 2025-1 and to review the classification if material facts change.

6. Insurance and Risk Allocation

6.1 Insurance. Contractor shall maintain at its own expense: (a) commercial general liability insurance of at least [AMOUNT]; (b) professional liability/errors & omissions insurance of at least [AMOUNT] if the Services include professional advice; and (c) workers’ compensation coverage for Contractor’s employees (if any).
6.2 Indemnification. Each Party shall indemnify, defend, and hold harmless the other Party from third-party claims arising from its negligence, willful misconduct, or breach of this Agreement.
6.3 Limitation of Liability. Except for indemnity obligations, IP breaches, and confidentiality breaches, each Party’s aggregate liability is limited to [MULTIPLE] times the fees paid under this Agreement.
6.4 No Exclusivity. Company acknowledges Contractor may perform services for other clients, provided confidentiality is maintained.

7. Confidentiality and Data Security

7.1 Confidential Information. The Parties shall execute the Confidentiality terms in Exhibit C or incorporate an existing NDA.
7.2 Data Security. Contractor shall implement administrative, physical, and technical safeguards appropriate to the sensitivity of Company data and notify Company of any security incident within [HOURS] hours.
7.3 Return of Property. Upon termination, Contractor shall return or destroy Company Confidential Information and certify compliance.

8. Term, Termination, and Transition

8.1 Term. This Agreement commences on the Effective Date and continues until terminated as provided herein.
8.2 Termination for Convenience. Either Party may terminate upon [DAYS] days’ written notice. Company shall pay for Services performed and approved expenses through the termination date.
8.3 Termination for Cause. Either Party may terminate immediately for material breach if not cured within [DAYS] days after written notice.
8.4 Transition Assistance. Upon termination, Contractor shall provide reasonable transition assistance for up to [DAYS] days at the rates in Exhibit A.

9. Dispute Resolution

9.1 Escalation. The Parties shall escalate disputes to senior executives for good-faith negotiation.
9.2 Mediation/Arbitration. If unresolved, disputes shall proceed to [MEDIATION/ARBITRATION] in [VENUE].
9.3 Governing Law. This Agreement is governed by the laws of the State of [STATE], without regard to conflict of law rules.
9.4 Equitable Relief. Breach of confidentiality, IP, or restrictive covenants entitles the injured Party to injunctive relief.

10. General Provisions

10.1 Entire Agreement. This Agreement and its exhibits constitute the entire agreement between the Parties.
10.2 Amendments. Modifications must be in writing signed by both Parties.
10.3 Notices. Notices must be sent to the addresses above via certified mail, courier, or email with confirmation.
10.4 Assignment. Contractor may not assign this Agreement without Company’s written consent, except to an affiliate or successor. Company may assign to an affiliate or in a merger or sale.
10.5 Severability. If any provision is held invalid, the remaining provisions remain in full force.
10.6 Counterparts. This Agreement may be executed in counterparts and electronic signatures are binding.

11. Exhibits

• Exhibit A: Statement of Work (include scope, milestones, deliverables, pricing, acceptance criteria)
• Exhibit B: State-Specific Classification Factors/Disclosures
• Exhibit C: Confidentiality & Data Security Terms
• Exhibit D: Insurance Certificates
• Exhibit E: Compliance Certifications (e.g., background check, export controls)

IN WITNESS WHEREOF, the Parties have executed this Independent Contractor Agreement as of the Effective Date.

[// GUIDANCE: Attach classification checklist and state-specific notices for jurisdictions with heightened tests (e.g., CA AB5, MA, NJ).]