Contractor Onboarding: The Ultimate 9 Step Checklist

This article is part of our guide on independent contractors’ management.

Part one: 5-step internal checklist for seamless contractor onboarding 

Ensuring your team, as well as IT, finance, and legal are prepared to sign on a new freelancer or contractor requires several key internal steps. Here’s what should be on your to-do list before you dive into work.

1. Collect their contact details

Seems obvious, but basic information such as this commonly gets left incomplete or slips through the cracks, and can leave you scrambling down the road. After identifying the right freelancer for the job, make sure you have up-to-date information, including:

  • Full name
  • Phone number
  • Email address
  • ID or EIN number
  • CV and/or references to past work

By aggregating more comprehensive information about each contractor like their skill and portfolio work, you can start to build an internal pool of vetted workers you can turn to in the future. Instead of wasting time searching through freelance marketplaces, you’ll have a list of workers you already know and trust at your disposal.  

2. Sign and save all of your required legal documents

The more you standardize (and automate) the process of handling legal documents, the better you can ensure your contractor is in full compliance with all of your company’s policies. 

For every new non-payroll worker you hire, you’ll need them to sign a contract, NDA, and an IP Agreement. Your legal team may request that all (or some) of your freelancers and contractors will sign additional legal documents like Data Protection Agreement, Non-Compete Agreements etc.

Getting your freelancers and contractors to sign is only the start since you’ll also need to store these important documents. Storing it in old email threads will prove to be the wrong decision when you’ll be requested to present these during your company’s next due diligence. Storing them in a centralized place so you can easily locate them later, like a freelance management system, and even share it with your legal team is definitely the right way to go about.

You should know that failing to get your freelancers and contractors to sign a contract is against the law in some states and countries, like the NY freelancer law. Failing to get your freelancers and contractors to sign an IP agreement might get your company into much larger troubles.

3. Collect and share your contractor’s payment information with your finance team

The next step in the internal contractor onboarding process is to ask the contractor for their bank account information, as well as their preferred payment method, requested currency and provide this information to your finance team.

If, for some reason, the contractor refuses or is unable to provide standard identifying information (such as their name, business name, mailing address, or payment details), you may need to reevaluate their legitimacy.

To avoid being an unknowing participant in a money laundering scheme, your finance team is obligated to properly verify the identity of your freelancers and contractors by performing Know Your Customer (KYC)/ Anti-Money Laundry (AML) checks before sending any payments. 

In addition, they will also need to ensure they’ve received proper tax documentation (W8 or W9 for example). Asking you freelancers and contractors to present these documentation after they’ve completed their projects and they’re waiting for their payment is a sure fire way to ruin the relationship.

A contract that specifies how to pay the contractor is also required in most countries.

4. Request systems access and/or equipment from your IT team

Before your contractor starts, you’ll want to make sure they have all of the equipment they need to do their work, as well as access to any data and systems they’ll be using. Don’t wait until their first day to get all of this in order — most likely, your IT team will be swamped with other pressing requests. 

You’ll also want to document all of the equipment and access you share with your contractor, and get their signature. This helps ensure seamless off-boarding after the project or work arrangement ends. 

5. Document your contractor onboarding checklist

In most companies, HR teams are not taking an active part in the recruitment and on-going management of freelancers and contractors. However, they are the experts when it comes to employee onboarding and training. They are the ones discussing and optimizing the company’s guidelines with finance, legal and the management team. Therefore you should review your plan with them and also ensure they document it in their systems.

Part two: 5 points to cover with your contractors

The second section of our contractor onboarding checklist is aligning on expectations, explaining the work, and answering any questions they may have. Here are five points to discuss before the work begins.

1. Provide background information on your company and its business objectives

A freelancer or independent contractor will get up to speed faster if they understand what your company is all about, as well as its goals. With this information, they can better contextualize their work within the big picture, and produce deliverables that fulfill a true business need.

2. Define key milestones, deliverables, and deadlines

Next, you’ll want to discuss your objectives for hiring them and the deliverables they will contribute. During this conversation, you’ll want to reiterate the meaning of the work, your expectations for the deliverables (quality, speed, amount of time spent, etc), and deadlines.

3. Align expectations regarding payment terms

Freelancers commonly have different preferences when it comes to their payment methods. Some prefer to bill the company after each project or “milestone,” and others opt for a one-invoice-per-month cadence. And, as your non-payroll workforce grows, you may be hiring workers who operate in different countries, and subsequently want to be paid in different currencies. Aligning on all of this, as well as how quickly payments will be issued, is key to avoiding conflicts.

4. Establish communication rules

Also during contractor onboarding, you should determine how and how often you will communicate. This will probably depend on the type of work the freelancer or contractor is doing, how much they need to interact with other members of your team, and the level of autonomy you grant them. 

It may make sense to add the contractor to a relevant Slack channel. Or, perhaps you prefer to message via WhatsApp or SMS. Sometimes, good old fashioned emails will suffice. Whatever platform you choose, make sure both parties understand what kind of information they are expected to share, and when. 

5. Provide detailed feedback after the first milestone

Once a new freelancer or contractor completes the first milestone, it’s helpful to give them detailed feedback so they can better understand your needs and produce on-point, high-value work. Did the contractor deliver exactly what you wanted? If not, what was missing? What could they do differently next time? Do you require them to edit or change the work they already did? By giving them this feedback, you’ll make sure they improve with every milestone. 

How effective is your contractor onboarding?

Companies often gloss over freelancer onboarding because they want to get to work faster. But not dedicating time and attention to this process does more harm than good. It exposes your company to unnecessary risk and reduces productivity.

By making comprehensive freelancer onboarding standard practice in your organization, you’ll actually make things smoother and easier to manage contractors. And, as demand for freelancers rises, you’ll already be prepared to handle these processes. 

Related content: Read our guide to remote freelancer

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