Hiring a consultant

When hiring a consultant it's in your and the consultant's interest to make clear that the consultant is self-employed and not an employee or worker. This is becuase the consultant will benefit from a favourable tax treatment and you will not be subject to employment related liabilities as an employer (e.g. pension contributions or an obligation to provide paid sick leave). As well as making clear that the consultant is self-employed, a well drafted consultancy agreement will set out the consultant's obligations and duties, minimising the risk of future disagreements around scope of work and fees.

Important things to keep in mind when hiring consultants

  • When describing the consultant's duties, make clear that the consultant is obliged to carry out the work with due care and skill.

  • Define how long the assignment will last for (this could be a period of time or until a project is completed) and include details of milestones and deliverables that must be achieved.

  • Specify whether the consultant is obliged to supply their own equipment and materials. Requiring that the consultant supply their own equipment or materials may help support the self-employed status of the consultant.

  • Bear in mind that, unlike employees, consultants are generally under no implied obligation of confidentiality.  You should therefore include robust confidentiality provisions in the consultancy agreement.

  • Make clear that you will own any work and/or intellectual property that the consultant produces during the assignment.

  • Clarify other issues that are important to you, for example you can require that the consultant must follow your Code of Conduct.

Intellectual property rights

Unless specifically provided for in the consultancy agreement, the consultant will generally be the owner of any intellectual property they create during the assignment with your company.  If you are hiring a consultant to help you develop software, design a brand or create other types of intangible property, it is particularly important therefore that you include clear provisions governing the ownership and creation of intellectual property in the consultancy agreement. 

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