Treat the worker as an IC while he or she works for you—much the way you would the accountant who does your company’s taxes or the lawyer who handles your legal work.
There are a number of work habits you must avoid:
- Don’t supervise the IC or his or her assistants. The IC should perform the services without your direction. Your control should be limited to accepting or rejecting the final results the IC achieves.
- Don’t let the IC work at your offices unless the nature of the services absolutely requires it—for example, where a computer consultant must work on your computers or a carpet installer is hired to lay carpet in your office.
- Don’t give the IC employee handbooks or company policy manuals. If you need to provide ICs with orientation materials or suggestions, copies of governmental rules and regulations or similar items, put them all in a separate folder titled Orientation Materials for Independent Contractors or Suggestions for Independent Contractors.
- Don’t establish the IC’s working hours.
- Avoid giving ICs so much work or such short deadlines that they have to work full time for you. It’s best for ICs to work for others at the same time they work for you.
- Don’t provide ongoing instructions or training. If the IC needs special training, he or she should not obtain it in-house and should pay for it himself or herself.
- Don’t provide the IC with equipment or materials unless absolutely necessary.
- Don’t give an IC business cards or stationery to use that has your company name on them.
- Don’t give an IC a title within your company.
- Don’t pay the IC’s travel or other business expenses. Pay the IC enough to cover these expenses out of his or her own pocket.
- Don’t give an IC benefits such as health insurance. Pay ICs enough to provide their own benefits.
- Don’t require formal written reports. An occasional phone call inquiring into the work’s progress is acceptable. But requiring regular written status reports indicates the worker is an employee.
- Don’t invite an IC to employee meetings or functions.
- Don’t refer to an IC as an employee, or to your company as the IC’s employer, either verbally or in writing.
- Don’t pay ICs on a weekly, bi-weekly or monthly basis as you pay employees. Rather, require all ICs to submit invoices to be paid for their work. Pay the invoices at the same time you pay other outside vendors.
- Obey the terms of your IC agreement. Among other things, this means that you can’t fire the IC. You can only terminate the IC’s contract according to its terms—for example, if the IC’s services fail to satisfy the contract specifications.
- Don’t give the IC new projects after the original project is completed without signing a new IC agreement.