What term describes independent contractors hired by principals to perform certain tasks?

The term that describes independent contractors hired by principals to perform certain tasks is "independent contractors." These individuals or entities are not employees of the principal; rather, they operate their own businesses and offer specific services or expertise to the principal under a contract. Independent contractors maintain control over how they complete the tasks assigned to them, which differentiates them from employees who typically work under direct supervision and within the confines of company policies and structure.

In the context of business law, the distinction is important because it affects liability, tax obligations, and rights. For instance, independent contractors are responsible for their own taxes and are generally not entitled to the benefits that employees receive, such as health insurance and retirement plans.

While agents and subcontractors also play roles in business activities, they do not accurately capture the essence of what is meant by independent contractors. An agent represents another party in negotiations and can create legal obligations for that party. Subcontractors perform work under a contract made by another, often in a construction or manufacturing context, but are not necessarily independent as they may work under the umbrella of a primary contractor. Thus, “independent contractors” is the most precise term for individuals contracted for their services without being integrated into the principal’s operations.