Building a resilient foundation is critical in the legal landscape of independent contractor programs. For this article, we tapped our General Counsel, Doug Grawe, to unveil a blueprint that not only withstands legal scrutiny but also champions the cause of independent workers. Let’s explore how to create opportunities, simplify processes, and document decisions to foster a thriving independent contractor program – all backed by Openforce’s powerful platform.
Prove opportunities for the contractor’s financial success
Solid independent contractor programs fortify financial prosperity. Here are the core principles and how Openforce’s cutting-edge technology fosters an environment where contractors thrive in their entrepreneurial pursuits.
Economic empowerment: More than just compensation
Creating a successful independent contractor program begins with empowering individuals financially. First and foremost, the economics must work. The contractor must be paid rates that support their ability to run a profitable business.
That doesn’t mean guaranteed revenue or guaranteed profit. Still, the revenue opportunities should be attainable and sufficient so the contractor can cover reasonable business expenses (e.g., insurance, labor, equipment, licensing, benefits, etc.) and earn a good profit.
Independent contractors who are financially successful typically refrain from instigating misclassification claims.
Openforce offers a reliable full-service payment process. Our accounting staff works all hours to make sure contractor settlements are processed on time, every time. Contractors enrolled in Openforce also have flexibility in accessing funds based on their unique needs, which include cash advances.
Unleashing opportunities through strategic partnerships
At the heart of a successful independent contractor program lies strategic partnerships. Openforce has a wealth of tools and resources designed to strengthen opportunities for contractors.
Through Openforce’s marketplace, contractors can explore discounts, tools, and resources, elevating their earning potential and reducing operational costs. The Openforce marketplace empowers contractors to make informed decisions that drive profitability.
Make your independent contractor program easy to understand
An independent contractor program that is accessible and easy to comprehend is a cornerstone of success. This section explores how simplicity in contracts and processes can pave the way for a more transparent and streamlined relationship between contractors and businesses.
Crafting an independent contractor program that is easy to understand and explain is crucial for its success. The program should be easy to understand and explain for contractors, judges, juries, and agency officials. It should be clear and straightforward to understand that the contractor is in one business and the contracting company is in another. The distinctions should be recognizable and explainable even if the two businesses are related.
Simplified contracts and processes
Contracts shouldn’t be a maze of legal jargon. Businesses should write contracts for the layperson and keep them as short as possible. Contracts should be presented in a way that lets the contractor review them at their pace and gives them documentable choices. Consistency in language across all documents, websites, and social media reinforces the straightforward nature of the contractor relationship.
Streamline the qualification process
The contractor qualification process is made seamless through Openforce’s technology. Businesses can ensure accurate and consistent document collection with repeatable procedures and checkpoints. This simplifies the onboarding process and sets a standard for future engagements.
Proof of contractor decisions
This section addresses the importance of documenting decisions made by contractors and how Openforce’s technology seamlessly captures and validates each choice. From legal entity status to equipment selection, we explore the facets that empower contractors in their decision-making and provide a solid foundation for businesses to prove their independent contractor programs.
Decision-making is a testament to independence
Contractors should have the right to make business decisions that impact their profit and loss. More importantly, a good contractor program documents their choices so the contracting company can prove the contractor had rights and exercised them.
Openforce’s technology excels in documenting key decisions made by ICs, offering tangible proof of their right to business autonomy. From choosing legal entity status to selecting drivers and equipment, capturing every decision reinforces the narrative of small business ownership.
Key documentation points
Openforce’s technology goes beyond documentation, providing a comprehensive view of contractor decisions on insurance, benefits, tools, and strategic partnerships. This level of transparency protects businesses legally and empowers contractors to take control of their business trajectory.
Here are some examples of what a positive independent contractor program can prove:
- The contractor chose their legal entity status (sole proprietor, LLC, corporation).
- They chose the drivers (the contracting company can retain safety qualification authority).
- They chose the vehicle and equipment to perform the work.
- They chose to work with the contracting company and decided to do/not do business with others.
- They chose to advertise or not advertise their business.
- They obtained and paid for permits and licenses.
- They chose insurance.
- They chose or declined benefits and retirement plans.
- They chose other business tools (e.g., lawyers, accountants, equipment providers, marketing advisors, etc.).
- They accepted and rejected delivery opportunities from their contracting company.
- They made decisions that impacted their costs (e.g., set pay for their subs and helpers, chose maintenance and repair locations, chose where to get their equipment, etc.).
- They negotiated or had a path to earn non-standard rates from their contracting companies.
There are many opportunities for people to pursue small business ownership and for contracting companies to work with great contractors. With Openforce as your partner, we are not just creating programs; we are shaping a future where contractors thrive as independent entrepreneurs. Join us as we redefine the narrative of independent contractor relationships and champion success for all stakeholders involved.