Contractor compliance audit proposal: Free template
Customize this free contractor compliance audit proposal with Cobrief
Open this free contractor compliance audit proposal in Cobrief and start editing it instantly using AI. You can adjust the tone, structure, and content based on client size, industry, contractor types, and jurisdictions. You can also use AI to review your draft — spot gaps, tighten language, and improve clarity before sending.
Once you're done, send, download, or save the proposal in one click — no formatting or setup required.
This template is fully customizable and built for real-world use — ideal for pitching contractor classification audits to finance, HR, or legal leads in companies that rely on 1099s, freelancers, gig workers, or international contractors. Whether you’re addressing misclassification risk or preparing for a platform-wide audit, this version gives you a structured head start and removes the guesswork.
What is a contractor compliance audit proposal?
A contractor compliance audit proposal outlines your plan to evaluate how a company engages, classifies, and manages its independent contractors. It typically includes classification reviews, documentation checks, platform and policy audits, jurisdictional risk mapping, and corrective recommendations.
This type of proposal is commonly used:
- When companies scale quickly using 1099s or freelancers
- To reduce legal exposure around misclassification or co-employment
- Ahead of investor due diligence, M&A, or platform audits
- When clients use contractors across multiple states or countries with different thresholds
It helps companies stay compliant, avoid reclassification penalties, and confidently scale flexible workforces.
A strong proposal helps you:
- Review risk by contractor type, geography, and control structure
- Flag gaps in agreements, onboarding, or invoicing practices
- Recommend corrective actions that are realistic and legally defensible
- Equip teams with updated classification frameworks and processes
Why use Cobrief to edit your proposal
Cobrief helps you create a credible, structured proposal fast — with in-browser editing and smart AI support.
- Edit the proposal directly in your browser: Skip Word docs and formatting issues — just start writing.
- Rewrite sections with AI: Instantly tailor content for legal, finance, or HR audiences.
- Run a one-click AI review: Let AI catch vague risk language, missing scope boundaries, or unclear deliverables.
- Apply AI suggestions instantly: Accept edits line by line or apply all at once.
- Share or export instantly: Send your proposal through Cobrief or download a polished PDF or DOCX version.
You’ll go from draft to decision-ready without legalese or formatting delays.
When to use this proposal
Use this contractor compliance audit proposal when:
- A client wants to assess whether their contractors are correctly classified under state, federal, or international laws
- You're supporting a team preparing for due diligence, funding, or an internal HR/legal audit
- You’re advising on a shift from contractors to employees (or vice versa)
- A platform is scaling globally and needs to map worker risk across jurisdictions
- Clients have outdated agreements or decentralized onboarding and approval flows
It’s especially useful when the client knows they’re exposed — but doesn’t know how bad the risk is yet.
What to include in a contractor compliance audit proposal
Use this template to walk the client through your review process — from document intake to risk scoring and recommendations — in plain-smart language.
- Project overview: Frame the client’s risk or trigger event (e.g., growth, due diligence, complaint) and how your audit process brings clarity and structure.
- Scope of audit: Outline what’s included — classification tests (e.g., IRS, ABC, common law), contract reviews, onboarding analysis, geographic risk mapping, and policy review.
- Methodology: Explain how you’ll apply tests (e.g., control vs. independence, economic dependency), and what frameworks you use across jurisdictions.
- Documentation review: List documents you’ll review — contracts, SOWs, invoices, onboarding workflows, training materials, and platform usage (if relevant).
- Stakeholder interviews (if scoped): Note whether you’ll speak with ops, legal, or finance to understand how contractor workflows are handled in practice.
- Risk scoring: Describe how you’ll categorize misclassification risk — by geography, contractor type, or level of control — and what the output will look like.
- Recommendations and remediation: Detail how you’ll flag fixes — e.g., revise contracts, switch platforms, convert roles — and provide next-step guidance.
- Timeline and phases: Break the project into phases — discovery, documentation intake, analysis, and recommendations — with duration estimates.
- Pricing: Present a clear model — fixed audit fee, per contractor, or phased depending on team size. Include optional add-ons like implementation help or legal counsel coordination.
- Next steps: End with a CTA — like sending sample contracts, aligning on jurisdictions, or booking a kickoff.
How to write an effective contractor compliance audit proposal
This proposal should feel sharp, credible, and actionable — especially for legal, HR, or finance leaders under pressure to reduce exposure.
- Focus on practical risk: Don’t just cite laws — show where the business is most exposed and what they can do about it.
- Avoid legal overreach: Frame your findings as structured guidance and risk tiers, not legal conclusions unless you’re licensed to give them.
- Lean into frameworks: Clients often want to see the classification logic — show the test, scoring system, or decision matrix where possible.
- Address future-proofing: Recommend changes that will scale as they grow — not just fix today’s mess.
- Don’t overcomplicate: Keep terms simple — especially when working with fast-moving startups or international teams.
Frequently asked questions (FAQs)
Do I need to include jurisdiction-specific laws in the proposal itself?
No — reference key risk areas (like California’s ABC test or UK’s IR35), but keep full legal details in the deliverables. The proposal should focus on the process, not legal memorandums.
How deep should I go in reviewing contracts or invoices?
Enough to spot red flags — lack of IP clauses, exclusivity, time tracking, etc. You’re not rewriting agreements here (unless scoped), but flagging patterns and risk.
What if the client uses a platform like Deel or Remote?
Still audit. These platforms reduce risk but don’t eliminate it. You can review how the client configures roles, what documentation they collect, and whether it aligns with actual working relationships.
Should I price this per contractor, per jurisdiction, or flat fee?
Depends on complexity. For startups with <50 contractors, flat fee works. For multi-country or mixed-model clients, phased pricing by scope or region makes more sense.
What if they want implementation help after the audit?
Offer it as a second phase. You can support rewriting contracts, updating workflows, or moving contractors to EOR or employment models — but keep the audit standalone unless you’re bundling both.
This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.