Understanding Independent Contractor Agreements in Colorado

When it comes to maximizing the talent pool, a strong independent contractor agreement is crucial.

The world of pharmaceutical research is one that requires the utmost care and accuracy, striving to find the best way to heal, treat and cure all of us. In order to do this research, a lot of organizations now rely on their own laboratories as well as third-party contractors. For this reason, one of the most critical components of any organization in this industry is a way to manage its strategic resources.

An agreement that gives a company the ability to consider its own independent contractors and third party vendors as an extension of their own internal talent pool can be a game changer. Pharmaceutical consulting companies such as TigerTox must be able to adapt to the constantly changing landscape of drug development research, often using a lot of vendors to get the job done. On a much larger scale, the issue becomes helping drug manufacturers manage the overwhelming amount of research, laboratory studies, and other clinical trials that will all take place during the course of drug development. When keeping track of all the documentation and data that a drug manufacturer should have concerning every aspect of drug development through the clinical study phase, it is a good idea to start with an independent contractor agreement that can place order with the laboratories performing the toxicology studies and all other contractors, such as TigerTox, the pharmaceutical company should have on retainer.

Like any legal contract, an terms and conditions are short contractual agreements that define what the corporation is hiring or retaining the contractor to do, when the contractor must do it, how payment is processed, how to handle non-compliance issues, and other various details that may be unique to the circumstances at hand. An independent contractor agreement is more than just a way for an organization and contractor to communicate their business relationship to governmental agencies. When formulated correctly, an independent contractor agreement should set into motion a workflow of communication between those involved in drug development efforts, as well as those managed by the contractor.

When establishing an independent contractor agreement, it is essential to understand the difference between independent contractors and employees. While there is an inherent level of flexibility afforded to organizations when retaining contractors vs. hiring employees, there are far more legal considerations for the entity entering into the business relationship. For example, while the contractor does not need to be an employee of the company in order to get the job done, it is important to keep in mind that independent contractors are still afforded certain rights under Colorado law and are protected by discriminatory practice laws. And while many businesses have adopted the use of these agreements from a taxation and accountability angle, depending on the structure of the business and industry, the benefits can vary from one corporate entity to the next.

An independent contractor agreement is only a contract when those involved enforce it as such. Contingent upon the type of agreement the relationship is governed by, a legal misstep can potentially result in litigation. In addition to avoiding litigation, these agreements can also help companies avoid audits that may arise if individual auditors detect a pattern of misclassification, for example. The types of documentation you need to hold onto for your independent contractor can vary based on the terms of your agreement, but the goal should always be to determine what documents are considered reasonable for a particular drug development project – and why.

The basic components of an independent contractor agreement generally include the following: when entered into prior to the start of a drug development project, an independent contractor agreement can be a vital tool in ensuring the compliance and regulatory processes are met throughout every stage of the drug development process, from research and grant proposals to trial approval by appropriate governmental agencies.

While an individual company’s structure and focus may influence how the independent contractor is integrated into the process, a pharmaceutical company can benefit from a variety of ways when it comes to how an independent contractor agreement is created and executed. However, some of the areas for consideration may include:

• The formulation of an independent contractor agreement can vary from company to company. However, there are some Colorado-specific considerations that may influence the terms you want or need to implement in your contract.
• For example, a company may have employees that work independently without any sort of agreement, but an independent contractor agreement can be useful in several different scenarios.
• From how to retain the services of an independent contractor to how to ensure that their retained services are not negatively impacted by your budget, there are plenty of considerations when drafting an independent contractor agreement.
• How they are utilized by pharmaceutical industries, like TigerTox, and in Colorado specifically, can influence their specificity.

Lastly, the terms of your independent contractor agreement can play a significant role in how to ensure that they can meet every expectation or that they will continue their work to completion.