Remote Work and Labor Laws
What Every Digital Worker Should Know Before Signing a Contract
Hi Superstar,
“A remote employment contract might look like just paperwork, but it decides how you get paid, treated, and protected. Don’t sign until it makes sense.”
We took a break, but we realized something important. We can't be costing you to break your bank or your career by signing the wrong remote work contract.
So, yes, we're back and more consistent with our weekly schedule 👏🏽. This week, we are kicking things off with one of the most pressing questions a lot of remote workers ask:
How do I know if I’m signing the right remote contract?
If this is your first time working remotely, or if you've been freelancing without really reading the fine print (we see you 👀), you might be wondering:
What terms should I focus on?
What rights do I have if I'm working from another country?
Can this company terminate me without cause?
Am I protected if they don’t pay me?
Well, you’re in the right place.
In this article, we’re going deep into the essentials of remote work contracts and labor law basics you should be aware of so you never sign blindly again.
First, What Is a Remote Work Contract?
A remote work contract is a legally binding agreement between you and an employer (or client) that outlines the terms, expectations, responsibilities, and protections for both parties. Whether it’s called a freelance agreement, remote employment contract, or independent contractor agreement, the point remains: once you sign it, you’re bound.
This isn’t just a casual “let’s see how it goes” situation. It’s a professional commitment. And like the mafia quote: “Sign it light, suffer it tight.”
When you sign on the dotted line, you are acknowledging that you understand and accept the terms regardless of whether you read them (and please, read them!). This is because, according to the law, ignorance is not an excuse. Unless you’re legally classified as illiterate, your signature implies consent. So, before you go clicking “Sign & Return” because you’re excited about that new job or client, pause and understand what you’re committing to.
What Every Remote Worker Should Know Before Signing a Contract
1. Your Classification Matters More Than You Think
Before you even dive into payment or responsibilities, figure out how you’re being classified. Are you an employee, an independent contractor, or a consultant? These titles aren’t just administrative labels, they come with very different legal implications. Employees typically have access to benefits like health insurance, pension contributions, and protection against unfair dismissal. Contractors and freelancers, on the other hand, are considered self-employed and are responsible for their own taxes, retirement plans, and healthcare. Unfortunately, some companies blur these lines to avoid offering benefits, calling someone a “freelancer” while expecting them to work full-time with fixed hours. If your contract is silent or unclear about your classification, that’s a red flag. Always ask for clarity and make sure the classification aligns with your actual work structure.
2. Know Which Country’s Laws Apply (Jurisdiction Clause)
This is one of the most overlooked parts of a remote contract, and yet one of the most important. The jurisdiction clause determines which country’s laws govern your contract. So, even if you live and work in Kenya, if your contract says it’s governed by the laws of Germany or Delaware, USA, then that’s where legal disputes will be handled. This matters in case of issues like non-payment, wrongful termination, or breach of contract. If you need to pursue legal action, you’d have to do so under that jurisdiction, which may be expensive or logistically impossible. Always review this clause and consider whether the legal system listed is accessible to you. If not, you can ask for a neutral jurisdiction or at least be aware of the implications.
3. Payment Terms: Not Just ‘How Much’, but ‘When and How’
Don’t get carried away by the headline rate. Sure, $2,000/month looks great but when will it hit your account? Are you getting paid weekly, monthly, or after completing milestones? Is there a clause for late payments or penalties? Also, how will you be paid? Will it be via PayPal, Wise, bank transfer, or Deel? Are there fees or exchange rate issues involved? Your contract should include a clear payment schedule, the currency of payment, and preferred payment method. If the company doesn’t include this, ask for it. Also, look out for refund or clawback clauses; some contracts sneak in conditions that allow employers to withhold or reverse payment if they’re unsatisfied with your work. You need to be just as clear on the “when and how” of getting paid as the “how much.”
4. Termination Clause: Can They Drop You Overnight?
The termination clause outlines how your working relationship can end. Some contracts are “at will,” meaning either party can terminate at any time, while others require notice or a valid reason. You want to know: how much notice is required to terminate the contract? Are there conditions under which you can be fired without notice or compensation? Will you be paid for unfinished work? A vague or one-sided termination clause could leave you jobless without warning or compensation. Ideally, your contract should include a fair notice period (e.g., two weeks or 30 days) and a process for handling termination, including final payments, handovers, and access revocations. If you're unsure, ask a lawyer or labor expert to review it. It's easier to protect yourself before signing than to seek justice afterward.
5. Ownership of Work: Who Owns What You Create?
As a remote worker, especially if you’re in design, writing, coding, or product development, you need to understand intellectual property (IP) rights. Most contracts include a “work for hire” clause, which means that everything you create while working for that company belongs to them. That’s standard practice. But if you’d like to showcase your work in your portfolio or reuse certain ideas, this clause matters. You can request permission to use samples for non-commercial purposes or limit the scope of the IP assignment. Additionally, if you’re working on your own projects outside your client’s scope (like building an app or writing a book), make sure your contract doesn’t give them ownership of that too. Clarify what's theirs and what's yours to avoid future disputes.
6. Confidentiality and Non-Compete Clauses
Almost every contract includes a confidentiality clause, which restricts you from sharing private company information. That’s reasonable. But watch out for non-compete clauses that prevent you from working with similar companies, even after your contract ends. These can be very restrictive and sometimes unenforceable, depending on the country. For example, a clause that says “You can’t work with any tech company for 2 years” is overly broad and harmful to your career. Ideally, a non-compete clause should be limited in scope (industry), geography (location), and time (duration). Always ask for clarification or negotiate if the terms feel too tight. And again, when in doubt, ask an expert.
Latest Worldwide Fully Remote Jobs Currently Hiring
At Inclusivelyremote, we ensure to curate and provide the latest remote opportunities from remote companies that are fair in their hiring and hire worldwide, regardless of location. Here are some of the latest jobs on the site:
Online Data Analyst at TELUS Digital - Featured
Resources to Help in Your Remote Career Journey
Join Our Public Community: We’ve created a public channel to empower you with voice-recorded mentorship, curated resources, remote job opportunities, and valuable insights. Link
Our Resume Templates: Each template is accompanied by a comprehensive customization guide to assist you in tailoring your own resumes. Additionally, editable versions of the templates are provided for your convenience. Link
Our Social Media Handles: For daily tips on navigating your remote work career or tips to corporate success, check out our social media handles here Link
Introduction to Remote Work: Access our free ebook on what remote work is and how you can get remote jobs, especially other platforms to check out. Link
The ABC of a Successful Remote Job Application: Access our free ebook on how to tailor your resume and apply to remote jobs. I have tailored a resume template you can use as well as cold mail messages in drafting your cover letter. Link
The Remote Salary Handbook: This is the first published guide on remote work. Having been a remote worker from Africa, I know the struggles of getting good pay, I have been paid less countless times. This ebook lays down tips as well as templates to ensure no one gets to be like me. It’s currently on sale and would go a long way in your career journey. Link
Rooting for you this Month🫶🏼💡!
Yours truly,
The InclusivelyRemote Team
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This is really helpful. Thank you.
Wow. This is such good information. Thank you so much for putting this out there; as you mentioned, folks who are excited about a new job aren't going to be thinking in this vein. Corporations always have so much power, and self-advocacy is so important - right from the start!