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Employment contracts are essential when hiring employees, including consultants and independent contractors. These contracts require certain elements to protect your business and the employee, so it's important to get it right.
In this guide, we'll show you how to write a professional services employment agreement and where you can find a free template online to help get you started.
What is an employment agreement (professional services)?
A professional services employment agreement is a contract tailored to independent consultants and contractors, as well as employees of companies in the professional services industries. It sets out the terms of employment and the obligations of the employee and employer.
Download this template at Lawpath
When should I use an employment agreement (professional services)?
You should use a professional services employment agreement whenever you hire a new independent contractor or consultant. This ensures that their role is clearly defined and your company is protected from liability under employment law.
Employment agreement (professional services) vs full-time employment agreement
A professional services agreement differs from a full-time employment agreement as it contains clauses tailored to the specific services provided. Hiring an independent consultant or contractor is typically for a fixed term or project and that is reflected in the contract, whereas a contract for a long-term full-time employee is ongoing.
What does an employment agreement (professional services) include and not include?
A professional services agreement sets out the rights and responsibilities of the employer and the employee. It includes details such as the services to be provided, the length of the agreement, confidentiality and ownership of intellectual property.
The clauses contained a professional services employment agreement include:
- Name of employee and company
- Position and working hours
- Services provided
- Length of agreement
- Payment terms, including amount and handling of invoices
- Tax liability
- Reimbursement of expenses
- Intellectual property ownership
- Liability, damages and insurance
It is important that an employment agreement for independent contractors and consultants does not include any clauses or language that suggest they are a long-term employee. The law treats independent professional services providers differently to permanent employees for the purposes of tax liability and employee benefits, so the contract must make the distinction.
How effective is an employment agreement (professional services)?
A written professional services employment contract ensures that the contractor and the employer are clear on the services that will be provided and the terms of the agreement. It is also effective in distinguishing an independent consultant from a long-term employee. This way, the company does not become liable for tax, national insurance or employee benefits such as sick leave or holiday pay. It also protects the company and the contractor if there is a legal dispute over the services provided.
Do I need a lawyer for an employment agreement (professional services)?
You do not necessarily need a lawyer to write an employment agreement. There are templates available online that you can customise for your specific company needs. However, it is advisable to have an employment lawyer review the agreement to make sure that it complies with employment law and is distinct from a full-time employee contract.
Get access to free employment agreement (professional services) templates
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How do I write an employment agreement (professional services)?
A professional services employment contract should be written in concise language that makes clear the terms of employment for the specific services to be provided. It should include detailed clauses that cover all areas of the employment, from the duration and remuneration to the treatment of intellectual property.
Where to get free legal documents and templates like an employment agreement (professional services)
An employment agreement is a detailed contract spanning several pages, so it can be helpful to use a pre-written template that you can customise to your needs rather than writing the entire document from scratch. You can find free templates for a professional services employment agreement on the websites below.
- Lawpath. Small businesses and entrepreneurs can find a range of document templates available at LawPath. You can browse for free, but to customise and download the document you will need to register.
- LawDepot. LawDepot provides online legal documents to choose from, including a professional services agreement. Simply fill in the details online and download the document for free.
- LegalVision. LegalVision offers users unlimited use of legal document templates and lawyer consultations for a monthly membership fee of $199.
- Legal Zebra. Legal Zebra offers free PDF samples of its legal templates if you sign up to its marketing emails, but you need to pay a one-time fee to access customisable documents. An independent contractor document costs $27 to download.
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