Contractor Policy

Enlist the responsibilities and compliances to be followed while hiring resources on fixed terms.

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Contractor Policy-undefined

The contractor policy enables HR and hiring managers to follow certain set procedures and mandates while hiring or proposing to hire temporary or fixed term contract (FTC) workers for their functions to manage brief surges in workload or for specific tasks or for consultancy on a particular activity.

This policy template is available for download in Word format.

With This Contractor Policy Template, You Can:

  • Provide templates for hiring justifications and required approvals
  • Suggest approval matrix and expense budgets
  • Create HR evaluation methodology and maintenance of FTC records

In just a few minutes, you will be able to create a contractor policy. This policy covers rules to be followed with respect to:

  • Type and tenure of such employment
  • Compliances to be met for such employment
  • Training, upscaling, monitoring and assessing the activities of FTCs

Contractor Policy


In line with the company‘s hiring policy, < Company name > would hire professionals or consultants on contract for a specified tenure where specific tasks may not require full-time resources or where a special skill is required. These contracts are typically time bound, meant for a specific task, and with a start and an end date.

Scope and Applicability

The policy applies to all functions / departments of the Company.

Policy & Process


In line with the Company’s goals and requirements, manpower resources are vital to achieve its objectives. There are situations where a permanent or full-time employee may not be required for certain tasks or small target-oriented projects. This policy recommends that hiring managers may opt for temporary or fixed-term contracts.


The Manager of a department is responsible to assess the resources required to complete a task or a project by dividing it into long-term and short-term activities. Then he/she has to evaluate the resources available and required to complete the task or project. Based on recommendations and approvals from management, the manager will approach HR for temporary resources.

Upon receiving the justification and approvals, HR will review the proposal and take a decision based on the following:

  • it is confirmed that the task or project will last for only a temporary period
  • a particular job requires specific skills that are not available internally
  • a replacement is required for a person who is on long leave / travel / training
  • a temporary surge in work that requires additional resources
  • position is dependent on external funding or support until the task is completed

Offer of Employment

< Company >’s offer of temporary employment will make it clear to the prospective FTC that the contract is:

  • for a specified period of time only (i.e., the termination date will be stated)
  • for a specific task or project and that the contract will be terminated once it is complete
  • to cover for another employee who is absent from work and that the contract will terminate once the employee returns

Duration of FTCs

  • Company reserves the right to change the duration or tenure of the contract
  • Contractor has no right to demand regular employment status or benefits that are applicable to regular employees
  • Company may offer the contractor an extension to the original contract or a permanent role if the situation so demands

Terms of Employment

< Company > undertakes to pay contractual terms offered and accepted by the FTC. It is the Company’s policy not to discriminate against FTCs from regular employees in terms of safety, respect, treatment and work environment.

Non-contractual Benefits

< Company > will ensure that during their engagement, FTCs will be provided with all necessary tools, accesses, workstations, equipment, stationary and basic amenities.

Termination Procedure

  • In advance of the expected contract end date, the Manager will:
  • Remind the FTC that the contract is set to expire on a specific date
  • Review the tasks completed / pending and to assess if an extension is required
  • Consider any alternative work that may be available for the FTC to complete

Following the assessment, if it is decided to terminate the contract on the due date or prior to that, then a meeting with the FTC must be conducted to inform of the final decision.

Special Circumstance and Exception

Any deviation from this policy has to be approved by HR. Any changes to the policy has to be approved by Legal and Compliance.

Non-compliance and Consequence

Violation of this policy is subject to disciplinary action, up to and including termination.

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This template is meant to provide general guidelines and should be used as a reference. This is not a legal document. greytHR will not assume any legal liability that may arise from the use of this template.
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