Freelance Contract Template

Use our Freelance Contract to hire a self-employed worker for your project or business.

Updated July 5, 2024
Written by Josh Sainsbury | Reviewed by Brooke Davis

A freelance contract establishes working terms between a freelancer (or “contractor”) and a person or company that requires their services. A clear contract helps both sides understand what to expect from each other, allowing the freelancer to deliver work on time and the client to make payments promptly.

• What Is a Freelance Contract?
• When Do I Need a Freelance Contract?
  • Common Uses of a Freelance Contract

  What Is a Freelance Contract?

  A freelance contract is a document a client sends to a freelancer that explains the terms of their working relationship. It sets clear expectations between the two parties for a specific project over a set period.

  This document type is legally binding and ensures that everyone working on a given task is on the same page regarding service guidelines.

  Who Is a Freelancer?

  A freelancer is an individual who works on one-off projects or tasks for businesses and organizations and is not committed to a particular employer on a long-term basis.

  Freelancers are generally self-employed, typically have multiple clients at one time, and earn income per project. They are not company employees, and most freelance work is short-term.

  When Do I Need a Freelance Contract?

  You need a freelance contract for a single project over a clear time frame instead of a permanent, general work relationship. A company also may not involve freelance work as an official part of the company.

  Note that this type of worker is not the same as a temporary or “temp,” who is often placed at a company through an independent staffing agency to fill a position for a short period. Temporary workers are staffing agency employees, whereas independent contractors are self-employed. You can hire temporary employees using a temporary employment contract.

  Independent contractors generally cost a company less money than employees because they do not receive traditional work benefits such as health care, vacation pay, sick pay, or retirement.

  Independent contractors usually work on their schedules and are not expected to enter an office. Unlike salaried workers, freelance workers have no upward limit on their potential earnings. They are, however, expected to pay for out-of-pocket expenses unless approved by the company.

  A company’s insurance does not cover the contractor, making freelancers responsible for obtaining their insurance.

  Common Uses of a Freelance Contract

  A freelance contract has a wide variety of uses. There are many types of short-term projects that an individual worker can complete for a company. These are situations in which the client needs the contractor to complete a specific task:

  • A magazine hires a journalist to write an article.
  • A small business hires a programmer to create a website.
  • A theater company hires an actor to perform in a play.
  • A think tank hires a speaker to deliver their conference’s keynote address.
  • A family hires a pet sitter to watch their dog while they are on vacation.
  • A couple hires a photographer for their wedding.
  • A company hires a marketing consultant to increase awareness of their brand.
  • An office hires a plumber to fix leaky pipes.
  • A mother hires the next-door neighbor to watch her child for the evening.
  • A student hires a tutor to help them study for the SAT.

  If it seems like there’s a vast range of freelance jobs, you are right: contract workers are a growing part of the population. A 2018 poll by NPR and Marist found that an independent worker carries out one in five American jobs.

  Interestingly, many independent contractors today work for a single client instead of multiple clients due to in-depth projects or work agreements. However, under the Fair Labor Standards Act, these workers still do not receive employee benefits, including overtime pay.

  According to the Harvard Business Review, misclassifying employees as contractors has resulted in significant wage losses for workers.

  Companies usually look to freelance workers for projects that will not require extensive training or company equipment.

  Benefits of a Freelance Contract

  • Ensure both parties know what is expected of one another
  • Can be referred to in the event of a dispute
  • Protects both the freelancer and the client
  • Makes the freelancer look professional
  • Helps ensure the freelancer gets paid for their work
    

  Consequences of Not Using a Freelance Contract

  Without a freelance agreement, expectations of the freelancer and their required services may be unclear. The independent contractor and client must understand the project’s scope to avoid confusion or extra work.

  In addition, a freelance contract establishes to the IRS that the worker is not an employee of the company. Otherwise, the company may be expected to cover the individual’s Medicare and Social Security taxes and be responsible for any liabilities arising from the project.

  There are severe consequences for misclassifying a freelancer as an employee and vice versa, including hefty fines and potential jail time. You must understand the distinction between independent contractors and employees and the implications for yourself and/or your business.

  Consequences for the contractor

  • Loss of payment
  • Loss of time
  • Stolen work
  • Freelance workers may be fined for not disclosing accurate earnings information on their personal income tax returns.

  Consequences for the hiring company

  • Loss of money, particularly in unanticipated expenses
  • Loss of time
  • Legal expenses, including lawsuits
  • Breach of company information

  A 1099 form marks self-employment earnings for the IRS. A freelance worker earning over $600 from a company will receive a 1099 form. You can find instructions regarding this legal requirement on the IRS’s website.

  Freelance workers cannot have employees but delegate work to other independent contractors.

  There are many legal guidelines that a company must be aware of to treat its workers fairly. The Department of Labor’s website clearly explains the major employment laws.

  What to Include in a Freelance Contract

  A freelance agreement should detail the following specifications:

  • Description of work and services: Highlight the project’s scope and objectives. Clarify the services the contractor will provide to the client. If you wish to enter into an ongoing relationship with a freelancer, consider using a freelance retainer agreement instead.
  • Pricing and rates: Note how much the client will pay the contractor, indicating if the payment structure is hourly or at a fixed price for the project. Consider using freelance invoices to facilitate payments for the provided work.
  • Payment terms and schedule: Clarify the payment method, cancellation terms, late payment fees (if any), and the freelancer’s upfront deposit (if applicable).
  • End product ownership rights and licenses (copyrights): Explain if the client will receive exclusivity to the contractor’s work.
  • Terms and termination: Clarify whether the worker is at will and under what circumstances the relationship may be terminated.
  • Competitive engagements: State whether the freelancer will be subject to any exclusivity agreements, meaning they can’t work with a competing business for a certain period.
  • Non-disclosure, right to disclose, and confidentiality: Explain whether there’s a non-disclosure agreement or another confidentiality agreement in place.
  • Changes and revisions: Provide the guidelines the client must follow if they want to change the project once the freelancer starts it.
  • Indemnity clause: Clarify the party responsible if something goes awry.
  • Party signatures: Include signatures of all parties involved.

  General terms in a freelance contract

  A freelance contract typically addresses the following elements:

  • The names of those involved in the project: Include the names and contact details of the parties involved in the agreement.
  • Details about the services delivered and the expectations for both parties: Establish the project’s scope and what is expected of both parties.
  • Specific dates for the work: Are there multiple deadlines? Is there a specific time the project must be finished?
  • Legal clarification of the contractor’s role: Why does an independent contractor complete the work instead of an employee? This helps clarify to the IRS that the company will not pay for the same work benefits for the worker as the company would for an employee.

  Freelance Contract Sample

  Download a sample freelance contract in PDF or Word format below: