Who is a Rent-a-Chair Contractor Agreement for?
Although typically associated with the hair and beauty industry (see our Rent-a-Chair Contractor Agreement (Hair and Beauty) specifically tailored to the hair and beauty industry), this innovative and flexible arrangement can be used in other industries where different businesses can provide services from a shared space, such as in the healthcare, wellness, photography, and fitness industries.
A rent-a-chair arrangement can be an excellent way for a business owner to earn extra income from their space and provide networking and collaboration opportunities. For freelancers, the arrangement offers the ability to set up and grow their business without the upfront cost, time and energy of setting up their own clinic/studio/store, together with the benefits of flexibility and autonomy.
This agreement is suitable for shared space arrangements in any industry, from an osteopath renting a room in a health and wellness clinic to a personal trainer operating their business in a gym.
This agreement is unsuitable if you want to create an employer/employee relationship between the parties – see our Individual Employment Agreement instead.
Why do I need a Rent-a-Chair Contractor Agreement?
Rent-a-chair type arrangements can work well for both sides, but to protect your business, your clients, and your reputation, it is essential to get your specific arrangement clearly documented so that both you and the freelancer are on the same page from the start (particularly as to fees, payment, access rights and permitted use of the space).
It is also important to have a clear written agreement to reduce the possibility of the IRD determining the arrangement as an employer-employee relationship (as opposed to an independent contractor relationship), which would require you to pay all employment entitlements (annual leave, sick leave etc).
What does a Rent-a-Chair Contractor Agreement cover?
The Rent-a-Chair Agreement is simple, easy to understand, without legalese, and fair to both sides, to reduce negotiation time and start the relationship positively. Importantly, it states that the freelancer is an independent contractor, not an employee. It covers all the key terms of the relationship (with lots of flexibility for you to customise to your circumstances), such as fee (with options for fixed fee, percentage of freelancer’s earnings, or a combination of both), bond, outgoings and utility charges, equipment/facilities provided in the space, marketing, client booking and payment system usage, and optional non-competition and non-solicitation restraints (to stop the freelancer from taking your clients or employees away or setting up in competition to you).
Renting a separate room to the freelancer (as opposed to just a chair or space within your premises) might be considered ‘subleasing’ or ‘sublicensing’ under your lease, which typically requires prior written approval from the landlord. Check the terms of your lease before you commit to anything.
How long will it take me to create my Rent-a-Chair Contractor Agreement?
Around 10 minutes – do it on your next coffee break! During the Q&A you can save your progress to come back later, or repeat the Q&A to change an answer or produce a new version of a document.
What information do I need to complete the Q&A?
- The name and contact details of the clinic/studio owner and independent contractor
- The start and end date for the arrangement
- The space being rented, access hours, fee (with optional bond), payment terms, what equipment/facilities are being provided in the space
- The duration and area of any non-competition and non-solicitation restraints
- Agreed arrangements for client bookings, marketing, payment systems, and ownership of the client list
What if I need help?
On Your Terms has teamed up with Luminate Legal to offer its customers the option of obtaining legal advice from a lawyer to provide extra assurance and peace of mind. If you would like to ask a lawyer some quick questions about your document (or your responses to the Q&A), or have your document reviewed/edited by a lawyer, click here to view and select Luminate Legal's packages and fixed-fee pricing exclusively for On Your Terms customers.
What do I do once my Rent-a-Chair Contractor Agreement is created?
The agreement is ready to be signed as soon as you have downloaded it. Both parties must sign it to ensure it’s legally enforceable, and this should be done before the contractor starts work. If you need help with how to sign the Rent-a-Chair Contractor Agreement, read our helpful blog here.
Other helpful information:
- Check out these blogs: Employee vs Contractor - What's the difference? When a ‘Rent-a-Chair’ Arrangement is the Perfect Solution
- You may also find these bundles or documents useful for your business: Services Agreement, Individual Employment Agreement, Influencer Agreement, Rent-a-Chair Contractor Agreement (Hair and Beauty)
- Check out our FAQs
If you’re unsure whether this agreement is what you need, reach out to us at hello@onyourterms.co.nz – we’re happy to help!
If you’re not satisfied with your purchase of this product for any reason, let us know why within 10 days of your purchase and we’ll work with you to make sure you’re happy, including giving you a full refund if necessary.
Disclaimer: On Your Terms was created to provide fast, easy and affordable access to legal information and documentation. We are not a law firm and do not provide legal advice. The information and documents we provide are of a general nature, designed for common situations, and may not be suitable for your needs or circumstances. If you need legal advice, we have a network of specialist law firm partners able to help you here.