The employment space has changed immensely over the last 10 years, with an ever expanding pool of freelancers, virtual assistants and independent contractors. The 2015 Working Trends survey found that SMEs have on average 31% of their workforce freelancing compared with just 25% in 2011. Even more astonishing is this figure is expected to grow by a whopping 40% by 2018, with no companies surveyed intending to reduce freelancers as a proportion of their talent.
The law looks at independent contractors differently from employees. Generally, independent contractors are defined as those who operate their own business and who are contracted to perform services for others without having the legal status of an employee. As such, they are often engaged by a client under a commercial contract, rather than as an employee under an employment contract. As a result, under common law, independent contractors have the same rights as their clients to control the terms of the contract.
As an independent contract, it’s important to stay on the right side of the law so that you are your business are protected. Here are my top 5 legal tips for you to consider: .
- Get it in writing – For every freelance job you should have a contract. The contract should clearly set out the working agreement in writing so that there is no confusion about the price, services and timeframe.
- Set the terms of the contract – Ensure that the terms of the contract are clear and meet the needs of your business. There are many contracts available to download on the internet but just make sure they are suitable for an Australian Market and suited to your business. I had one client who was using a contract that said the relevant law that applied to the contract was Texas, even though they were located in Sydney! Also ensure you clearly set out the timeframe, hours of work, type of work, the limits on what tasks you are expected to undertake.
- Confidentiality – If you are working for a client on tasks such as setting up a data base, editing a book or producing a mailing list, be professional and ensure you have a confidentiality agreement clause in your contract. This will give peace of mind to your client that you are not going run off and sell their precious information. Pay special attention to anything you share on social media that breach your client’s confidentiality.
- Ownership of material – This area creates the majority of disputes between clients and freelancers so be sure you set out clearly who own concepts, designs and ownership of intellectual property.
- Getting paid – There are two important points to be aware of when it comes to payments.
> At the at the beginning of your relationship with a client, ensure you set out your payment structure including your terms of payment and payment amount.
If you fail to be paid, stop work if if it has not been completed. If the work has already been delivered, be proactive and send a letter of demand.
Good luck with your freelancing career, and if doubt, ensure you seek legal advice from an expert.
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- The legalities of freelancing: What you need to know - January 17, 2016