AI use policy for freelancers and contractors working for you

A business's AI policy binds its employees through their contracts and the handbook; it binds a freelancer or contractor only if the contractor agreement says so, and most do not. The freelance developer, designer, writer or assistant works on their own equipment and accounts, uses whatever tools they like, and delivers work the business assumes is theirs to assign, which it may not be. The policy for contractors sets rules a contractor can follow, and the contract provisions bind them to it, deal with ownership of generated work and allocate the liability. For £995, fixed, with delivery in five working days, I draft the business's AI use policy and the contract provisions that accompany it.

Who this is for

Businesses in England and Wales that engage freelancers, contractors, consultants, agencies or outsourced providers on work where AI tools are likely to be used, and agencies whose own contractors deliver to their clients.

What matters in an AI use policy for contractors

Why the business's policy does not reach a contractor on its own

An employee is bound by the employer's policies through the contract of employment and the handbook, with breach a disciplinary matter, but a contractor is bound only by the terms of the contractor agreement, so that a business which has an AI policy for staff and engages a freelancer under a one-page agreement (or an email) has no control over what the freelancer does with its material; the policy drafted for contractors is a short document for someone outside the business (the tools they may use, what they must not enter, what they must disclose and check), and the contract provisions make it a term of the engagement, because a policy sent as an attachment and not incorporated is advice rather than obligation.

The contractor agreement and the clause that incorporates the policy

The contract provisions drafted with the policy include the incorporating clause (the contractor agrees to comply with the policy as updated on notice, with the policy annexed), the warranty that the contractor's tools and accounts meet the policy's requirements, the disclosure obligation (the tools used, on request and in the deliverable where the policy requires), the audit and information right, the right to require a tool to stop being used on the business's work, the termination right for breach, and the flow-down to anyone the contractor subcontracts to; where the business itself is a contractor to its clients, the provisions flow the client's restrictions down to its freelancers.

Confidential information, client material and the contractor's own tools

the policy bars confidential information, trade secrets and clients' data from tools whose terms allow the provider to retain inputs or train on them, since the reasonable-steps test in the Trade Secrets (Enforcement, etc.) Regulations 2018 and the business's confidentiality duties both look at what was done to protect the information, and a contractor's own tools are the business's biggest exposure; the policy requires the business's material to be used only in tools whose terms meet the policy (or the business's own accounts where it provides them), prohibits consumer tools for anything confidential, requires the contractor to keep the business's material separate and to delete it at the end, and the contract provisions require the contractor to accept a data processing agreement under Article 28 of the UK GDPR where personal data is involved: the UK GDPR treats personal data entered into an AI tool as processing, requiring a lawful basis, a notice to the people concerned, a data processing agreement with the provider under Article 28 and an impact assessment under Article 35 where the use affects individuals, and the contractor's tool is a sub-processor the business must have authorised.

Deliverables, ownership and the assignment that assumes an author

A contractor agreement assigns the intellectual property in the deliverables to the business (unlike an employee, whose work belongs to the employer under section 11 of the Copyright, Designs and Patents Act 1988, a contractor owns what they create unless the agreement assigns it), and the assignment assumes the contractor owns something to assign; a deliverable generated by a tool with no human author has an uncertain owner under section 9(3) of the 1988 Act and may reproduce third-party material, and the contract provisions require substantial human authorship in the deliverables, an assignment of whatever rights the contractor has in generated elements (with the tool's output terms checked), a warranty that the deliverable is the contractor's own work save as disclosed, a record of the tools used, and a non-infringement warranty limited to what the contractor has checked and disclosed, so that the business knows what it has acquired.

Disclosure, checking and the work that arrives generated

The business usually learns that work was generated by discovering it (the invented citation, the code that fails the licence scan, the article that reads like every other article), and the policy requires the contractor to disclose substantial generated elements in the deliverable, to check generated content as the business's own staff would (facts, sources, figures, code, originality), and to answer questions about the tools used, with the contract provisions making undisclosed generated work a breach; a business that pays for original work and receives undisclosed generated work has a claim, and the policy makes the claim clear.

Liability, insurance and the contract provisions that go with the policy

The contract provisions allocate liability for the contractor's breach of the policy (an indemnity for undisclosed generated work, infringement in generated elements and confidential information entered into prohibited tools, within a cap), require the contractor to hold professional indemnity insurance that covers their work including generated elements (which some policies now exclude), and address the contractor's status: the policy is written so that it controls what the contractor does with the business's material and deliverables rather than how they do their work, because a business that dictates a contractor's working methods in detail affects the employment status analysis under the tests HMRC's CEST tool applies.

What it costs

AI use policy, £995. Internal policy plus the accompanying contract provisions. Five working days.

AI provisions in a contract, £595. Review or draft AI-specific terms in a supply or customer agreement. Five working days.

Email me at geoffrey@caesar.co.uk with what you need and any documents, and I will confirm the scope and the fee in writing, usually the same working day.

What you get

• An internal AI use policy your staff will follow, rather than a document that bans everything and is quietly ignored
• Contract provisions covering output ownership, training data, confidentiality and liability
• A defensible position to give customers who ask what your AI governance looks like
• Review of your AI suppliers' terms, including what they reserve the right to change
• Practical guidance on what to permit, what to restrict and what to prohibit outright
• One round of amendments

What is not included

• Technical AI assurance, model testing or bias auditing
• Sector-specific regulatory approval
• Advice on non-UK regulatory regimes beyond flagging where they apply
• Ongoing regulatory monitoring

Questions I am often asked

Our staff AI policy says it applies to contractors. Does it?

Only if the contractor agreement incorporates it. A policy attached to an email is advice; the incorporating clause with a warranty, disclosure, audit and termination makes it an obligation. The provisions drafted with the policy do that.

Do we own work a freelancer generated with an AI tool?

Only what the agreement assigns and the freelancer had to assign: generated work with no human author has an uncertain owner. The provisions require substantial human authorship, assign whatever rights arise, and limit the warranties to what the freelancer has checked and disclosed.

Can we require freelancers to use our AI accounts?

For the business's material, yes, and the policy provides for it where the business supplies accounts. The policy controls what the contractor does with your material rather than how they work, which keeps the employment status position where the agreement puts it.

Related guidance and services

• AI contracts and AI use policies, £995, the service this page describes
• Data protection agreements and privacy terms, £795
• Employment contracts and handbooks, £595
• AI use policy for a consultancy
• AI use policy for a design agency

This page is general guidance for businesses in England and Wales, not advice on your own circumstances. Last reviewed: October 2026. Email geoffrey@caesar.co.uk.