Once a startup has properly classified its worker, it should document its relationship with the worker in order to clearly identify the classification, compensation and benefits (e.g., base salary, bonus, commissions, equity, PTO/vacation, signing bonus, relocation reimbursement, and health insurance benefits), and other terms and conditions of the arrangement.

Contractors should sign a contractor agreement with provisions covering fees, treatment of the startup’s confidential information, assignment of the contractor’s inventions to the startup, and other basic terms. They should not be formally or informally referred to as employees of the startup or sign documents that the startup normally provides to its employees, including its employee non-disclosure, confidentiality, or invention assignment agreements, as this can affect the nature of the contractor relationship.