A North Carolina independent contractor agreement is a document stating that a contractor will perform a specific service for a client under certain conditions. It explains the agreement’s commencement date, termination protocols, work ownership guidelines, and other details.
North Carolina law defines an independent contractor as an individual who contracts to complete work for a client. An independent contractor isn’t under the client’s direction or control regarding how they perform the work or what they have to do as the work progresses.
North Carolina uses the common law classification test for independent contractors. This test classifies employees based on three essential elements:
In cases when behavioral control and financial control are under the purview of the employer, the employee is a payroll employee rather than a contractor. Under this arrangement, an employee may receive benefits such as paid time off or insurance.
In a contractor relationship, the contractor retains behavioral control and the responsibility of financial control but doesn’t have the same benefits as a payroll employee.
An independent contractor will not have the same rights as a full-time or part-time employee of a business. The difference in rights is because an independent contractor is self-employed while doing work for the business. However, independent contractors do have some rights, including:
You can also explore some other aspects of working as a contractor, including:
Much like classification and definition, North Carolina does not have unique laws when it comes to taxes. Instead, North Carolina refers to the IRS criteria for independent contractors. Taxes are handled accordingly.
Independent contractors can’t apply for unemployment under most circumstances in North Carolina. During the 2020 COVID-19 pandemic, independent contractors were eligible for Pandemic Unemployment Assistance (PUA), which ended on September 4, 2021. [1] No other provision exists to allow independent contractors to earn unemployment benefits.
Contractors in North Carolina can’t seek compensation for work injuries. If they get injured while completing work for a client, they must seek coverage from a personal workers’ compensation insurance plan they’ve purchased in advance.
View a sample of our North Carolina independent contractor agreement. When you’re ready to start creating your own, you can download the template as a PDF or Word file:
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The document above is a sample. Please note that the language you see here may change depending on your answers to the document questionnaire.
