The independent contractor agreement (ICA) in real estate is the document that establishes the working relationship between the brokerage and an agent. Typically it clarifies commission splits and broader business practices.
ICA is the commonly used acronym for the independent contractor agreement.
Most importantly, the ICA is often negotiated along with any commission splits and agent incentives. As a result, negotiating the independent contractor agreement is often done to change the commission split between the brokerage and agent. More broadly, the independent contractor agreement establishes working practices between the agent and the brokerage. This can include office practices, how payments are processed, and any non-compete clauses, among other terms. It also elaborates that the agent is an independent contractor, not a full-time employee. This usually means the language of the contract is designed to clearly show an independent contractor relationship as defined by state and federal law.