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  • Writer's pictureAvanlee Fisher

Successfully Navigating Work Relationships with Independent Contractors

Updated: Feb 5, 2023

Asian business man sending a text message from phone while sitting in front of his laptop

Working with independent contractors rather than employees comes with many benefits—for both your business and for the independent contractors themselves. For example, working with independent contractors can help you cut business costs like training costs, material costs, benefit costs, and office space. So, if you are thinking of working with independent contractors rather than employees, here are a couple of tips for successfully managing contractor relationships.

Refrain from Treating Contractors as Employees

An independent contractor is not an employee. Rather, independent contractors are considered to be autonomous business people who agree to perform a task or create a product for another individual or company. Therefore, it is essential—especially for legal reasons—that you treat your independent contractor as an independent entity and not as an employee.

Since you are not your independent contractor’s boss, you cannot exercise the same control over them as a boss would to an employee. For example, you cannot assign your contractor specific working hours; rather, independent contractors must be given the freedom to work whenever they wish, as long as they meet the agreed upon deadline. Furthermore, you should limit the amount of instruction and equipment to what is only necessary to complete the agreed upon specifications for the task or product. Additionally, your independent contractor cannot be barred from working for other clients or even using subcontractors. These are only a few of the limitations you should be aware of before working with independent contractors.

Be as Clear as Possible

In order to best manage your relationship with your independent contractor(s), it is essential that you be clear and concise in all of your communications. Since contractors are not employees, you will not have the luxury to schedule work meetings, demand detailed reports, or offer extensive training. Ideally, you are working with the independent contractor given their preexisting expertise and knowledge. Therefore, in order to maintain a legal and successful work relationship, be very clear about the specifications and expectations of the task. Communicate precise standards, requirements, and conditions, as well as necessary licensure and/or certification. When developing a written contract with your independent contractor, clearly and concisely define the agreed upon responsibilities and deadline(s) for the work, if applicable.

Find Objective Ways of Measuring Performance

You may be wondering how you can still measure your workers’ performance if they are independent contractors rather than employees. While you may not be able to observe your contractors on a daily basis, send them employee satisfaction surveys, or engage in yearly performance appraisals, there are others ways of measuring performance. One such way includes carefully tracking the quality of work using objective metrics. Some of these objective metrics may include timeliness in finishing a task, the number or frequency of errors, the quantitative output, and/or the profitability of the work. You should also carefully keep tabs on subjective metrics including professionalism, willingness to communicate, and overall skill.

Using these metrics to measure the performance of your independent contractor will help you reach your business goals and communicate clear expectations. Furthermore, if you are new to working with contractors, developing objective metrics to measure contractor performance can help you vet future contractors. Furthermore, pre-existing metrics can help you know when to end your contract or provide feedback if expectations are not being met.

Working with independent contractors rather than employees may be just what you and your business needs. Nevertheless, before working with contractors, make sure that you are prepared to manage your work relationship with them in an effective—and legal—way.

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