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Contract for Service Overview


A contract for service is different from a contract of service in many ways including the employer-employee relationship. A contract for service is an agreement used to hire a self-employed, freelancer, or an independent contractor for some services. In this case, there is no relationship between the employer and the contractor but the agreement is between an employee of the company and the independent service provider. Unlike in a contract of service where the employee is hired by the employer, employees hire freelancers in a contract for service. Thus, based on this definition, Terri has a contract for service with Jackson Mortgage Brokers.

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Factors for Contract for Service

The first factor for agreement for service is the terms of hiring. In a contract for service, the independent service provider is not hired by the employer but by an employee (Chen-Wishart 372). Therefore, the individual is not answerable to the employer but to the employee. In Terri’s case, she was hired by Glenn Simpson, who is the company manager. Therefore, she is accountable for the services that Glenn request. She is also can neither demand payment from the company owner nor can she consult with him or her.

The relationship between the service provider and the hiring employee revolves around the completion of work. It means that Glenn’s and Terri’s relationship is governed by the service provided, hence, upon completion of the service it ends (Practical Law). Terri is free to be hired and work for another company as she is not a legal employee of Jackson Mortgage Brokers. It is for the same reason that Terri works for approximately 20 hours a week in the company. Terri also has the liberty to hire other workers to assist her in her task even without consulting Glenn. Her freedom is based on the fact that she is an independent service provider who delivers services on her terms.

Another factor is the mode or terms of payment as applied in a contract for service. The hired personnel is not paid in terms of wages or salary as is the case for an official employee (Practical Law). Glenn could pay Terri in a lump sum for each job because it is an unofficial job. The company employer also does not owe Terri the duty of care. Therefore, she is an independent contractor and cannot demand payment from the firm owner.

Individuals hired under contract for service are not protected by the legislation Act. Legislation act only covers employees officially hired by the employer of the company. However, contractors in a contract for services are covered by the Safety Health and Welfare Act of 1989 as well as the Equality Act (Chen-Wishart 376). The service provider is protected against working in unsafe or unhealthy conditions and should have equal chances of employment. Although Terri is not employed by Jackson Company, she can sue them when subjected to unhealthy and unsafe conditions or when her welfare is not considered during her contract period.


Terri is engaged in a contract for service by Glenn, the facility manager. She has no relationship with the organization’s employers but with the manager. She receives unofficial payments and is not protected by the legislation Act. Terri provides on and off services to the company because and has the freedom to work with other companies. She also can hire workers to help in her service delivery duties.

Works Cited

Chen-Wishart, Mindy. Contract Law. Oxford University Press, 2018.

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Practical Law. “Contract for Services.” 2021, Web.

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