Retail Contractor Agreement Template

Self Employed Sales Contractor Agreement


This Self Employed Sales Contractor Agreement is designed to allow your business to obtain sales staff on a contractor basis as opposed to employing them. There may arise situations where it may not be necessary or appropriate for your business to employ sales staff on a permanent basis.

If you wish to use this document in a scenario that involves personal data, standard clauses for data protection and data processing are available in our GDPR & Data Protection Group.

This document is particularly useful in non-retail situations where your business requires the contractor to actively seek customers and sales and he is rewarded by your business by way of commission. An agreement such as this also allows for greater flexibility than permanent employment. A short term, renewable contract can assist your business in keeping its workforce in line with market demands.

We have also provided a version of this template, the Sales Contractor (Service Company) Agreement in the Service Company Contractors sub-folder, to be used when the contractor entering into the agreement with your business is a personal service company (or other intermediary company) rather than the individual providing the sales services for your business. Please see the information page accompanying that version for guidance about tax, employment status, and IR35, where the contractor engaged by a business is such an intermediary company, and the sales services are carried out for the intermediary by the individual who is engaged by it.

This agreement states that the individual is not employed by your business but self employed. It provides that your business does not have to pay taxes, national insurance contributions, pensions, benefits or similar. Under this template, your business pays a standard fee plus commission and it is up to the individual contractor to pay any sums due in tax, national insurance etc.

This template aims to help reduce the risk that the contractor might be deemed in law to be a de-facto employee of your business rather than (and as intended) a self-employed freelance contractor. However, whether he is treated by HMRC, an employment tribunal, or any other body, as a self-employed contractor will depend not just on the content of this contract. It will also depend on all other circumstances, including the practical implementation of the contract, and the arrangements between, and conduct of, your business, the individual, and any person engaged by individual to do any of the sales work for the individual.

HMRC provides some guidance on its website about self-employment, but its decisions as to whether someone is self-employed are often based on a “balancing exercise” in which it gives weightings to various factors. However, neither the HMRC guidance nor case law are sufficiently precise to make it possible to predict how this “balancing exercise” would be carried out or what the position will be in any situation. For that reason we recommend that you and the prpposed contractor take professional employment law, tax, and NIC advice in relation to the particular circumstances before deciding to use or adapt this template.

Nevertheless, a carefully worded agreement ensuring the independence of the freelance contractor is a key starting point. As a self-employed freelancer rather than as an employee of your business, the contractor is, for example, free to provide your business with a suitably qualified person in his place rather than do the some or all of the work personally, and is free to determine when, where and how work is completed (subject of course to your business requirements).

Optional phrases and / or paragraphs are enclosed in square brackets.

This Self Employed Sales Contractor Agreement contains the following clauses:

1. Definitions
2. Duration of the Agreement
3. Contractor’s Obligations
4. Fee
5. Sales and Commission
6. [Expenses]
7. Late Payment
8. Tax Liabilities
9. Status of Contractor and its personnel
10. Competition
11. Confidential Information
12. Intellectual Property
13. Liability
14. Force Majeure
15. No Waiver
16. Assignment and Subcontracting
17. Third Party Rights
18. Termination
19. Company Property
20. Notice
21. Entire Agreement
22. Law and Jurisdiction

and an optional Schedule of Services.

This document is in open format. Either enter the requisite details in the highlighted fields or adjust the wording to suit your purposes.

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