The freelance market is growing at a rapid pace. While freelance employees offer the advantage of high-quality skills and a fresh perspective on your company, there are legal issues to keep in mind.  If you’re considering hiring freelancers for the first time, you should be aware of how employment law affects this type of arrangement.

Taking on freelance workers typically involves no long-term obligations for both parties. HR managers hire a freelancer for a single, short-term project; you can use the same individual repeatedly if you’re happy with their work, but it’s better to draw up a new contract each time.

Setting up the Contract

As defined by employment law, a freelancer is a type of worker who supplies services on a self-employed basis. First, you should determine employee status by confirming that the freelancer operates under the self-employment standards outlined under employment law. There are a few main issues that you should know about self-employed workers:

• Discrimination laws apply to all employees – including the self-employed
• The freelancer has the ability to control how and when they work
• You’re under no obligation to offer work to the freelancer beyond the contract terms
• They’re responsible for paying their own tax and national insurance contributions

You should draw up a contract before the freelancer begins working. Keep in mind that freelance workers probably don’t have the same loyalty as a full-time employee, so consider putting in a confidentiality clause into the signed agreement. Be sure to set out the terms of work required on the project including start/end dates, progress reports and ownership of the final product.

Deciding Copyright Ownership

Your biggest concern is understanding who has copyright ownership on a freelance project. With regular employees, all of their work belongs to the company. However, with freelance workers, the copyright is given to them. Businesses end up spending a great deal of money to persuade a court that they own what you already thought you paid for. Be certain that you negotiate the specific terms of copyright ownership in the legal agreement with the freelance worker.

Given the current economic climate, your business may need to consider sharing the load of work with qualified freelance workers in the future. HR managers can take the necessary steps to protect the company from any legal ramifications with using independent contractors. By setting up a proper legal agreement in the beginning, you can make the relationship work out smoothly.