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Variable Fee Sub-Contractor Agreement


This Variable Fee Sub-Contractor Agreement is designed for use by a contractor wishing to engage an independent trades person to work for a variable fee on a self-employment basis.

This document has been updated with a simplified data protection clause which refers to a separate privacy policy (or similar). Full details of personal data use should be provided in that document.

This document includes a data protection clause but if the sub-contractor will be carrying out any data processing for the main contractor, you might wish to add the standard data processing clause which you can find here.

In this template, the sub-contractor is engaged on a non-exclusive basis. The order in which he carries out the work is at his discretion. He may engage the services of others at his own expense. Defective work must be put right at his expense. Equipment must be provided by him. Payment is to be made on completion of work.

The drafting of this agreement aims to reduce the risk that the individual sub-contractor might be deemed a de-facto employee of the contractor rather than a sole trader working on a self-employed basis as a sub-contractor, but whether in law he is self-employed rather than an employee will depend on all of the circumstances (not just on the terms of this sub-contractor agreement).

If the individual sub-contractor is deemed to be an employee, he will be subject to different levels of tax and National Insurance Contributions. Furthermore, the payment of income tax and National Insurance will be the responsibility of the contractor that hired the sub-contractor.

Further guidance on tax and employment status of individuals who act as sub-contractors can be found in the Guidance Note relating to Self-employment and IR35, but we nevertheless recommend that you take professional legal and tax advice before using this form of document.

This form of agreement is written from the perspective of a company as the Contractor. The Contractor does not have to be a company and any references to this can be changed without altering the meaning or purpose of the document.

This Variable Fee Sub-Contractor’s Agreement contains the following clauses:

1. Engagement of the Sub-Contractor

2. Indemnity and Liability

3. Provision of Equipment and Protective Clothing

4. Status of the Sub-Contractor

5. Consideration

6. Non-Competition and Non-Solicitation

7. Termination

8. Data Protection

9. Confidentiality

10. Force Majeure

11. Definitions

12. Miscellaneous

13. Governing Law and Jurisdiction

[and Schedule - Privacy Notice]

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