Independent Contractor Agreement
For engaging a freelancer or agency, with the IP assignment and the independence language that keep it a contractor relationship rather than an employment one.
The two clauses that matter here are IP assignment and the independent contractor relationship. Without the first, the freelancer who built your app may still own the copyright in it. Without the second, the CRA may decide your contractor was an employee all along.
That second risk is real and it is retroactive. Misclassification means back CPP and EI contributions, plus penalties and interest.
Use it when
- Hiring a freelance developer, designer or writer
- Engaging an agency for a defined scope of work
- Bringing on a fractional executive or advisor
- Any engagement where you need to own the resulting work product
Use something else when
- The person works set hours, uses your equipment and reports to a manager. That is an employee, and calling it otherwise does not change the CRA's view
- You are hiring through a staffing agency that has its own contract
What is in the document
Every section of the independent contractor agreement, as it appears in the file you download.
Questions
What makes someone a contractor rather than an employee in Canada?
The CRA weighs control over how the work is done, who provides the tools, whether the worker can profit or lose money, whether they can subcontract, and how integrated they are into the business. No single factor decides it, and the contract's label is only one input among many.
What happens if the CRA reclassifies my contractor as an employee?
You can be assessed for unremitted CPP and EI contributions going back years, plus penalties and interest. The contractor may also gain termination entitlements. This is why the independence language and the actual working arrangement both need to line up.
Who owns work a contractor creates?
By default the contractor usually does, which surprises people. Copyright in Canada generally vests in the author unless assigned in writing. This template includes an express assignment, and it is the main reason to use a written agreement at all.
Should contractors sign an NDA too?
The confidentiality obligations are built into this agreement, so usually no. A separate NDA makes sense if you need to share sensitive material before the engagement is agreed.