Don't Go It Alone
First, a disclaimer: I am not a lawyer; implement the opinions below at your own risk. Whether a worker is legally deemed an employee as opposed to a contractor can have important consequences on an organization. A worker's status may impose constraints on the management style - I use "management" in the broadest possible sense - you can use with the person. Based on the evolving legal landscape, the distinction is evidently not easy to make. So on this front, please get legal advice and heed it.
Bound By Contract
Second, I have observed that how the contract is written will influence the type of collaboration I can expect. Contracts that are higher-level or about the work method (i.e. meta contracts) seem to enable a level of flexibility critical to Agile collaboration.
If a contract is very detailed about the problem to be solved, the artifacts to deliver, and the timeline and milestones to achieve, then the other party legally bound to do exactly that. This can be problematic in the face of dynamic business conditions. For example, if new validated learning dictates that the whole project should pivot, the choice is then to let the contractor plow in the now invalidated direction or renegotiate the contract. Both are unappealing choices. This is why I prefer to write Statement of Work (SoW) that are less specific about the work, but more explicit about the method. A high-level description of the problem area the people will work on feels sufficient. I prefer to put my energy on getting an agreement how the work will be attacked. This can be a flavor of Lean, Agile, etc. Ideally, this agreement is reached with both the decision makers and the people that will actually get the work done. Yes, this removes a layer of legal protection. And yes, it relies a lot more on trust. But that's a bet with odds that I, as a leader, can influence.
Third, with the paperwork out of the way, it’s time to turn to the doers. Whenever possible, I try to forget which organization the people working on my project come from. People are people. If the established motivating principles of self-organization, face-to-face collaboration, and empowerment are important to employee-type humans, then they also apply to contractor-type humans. Unless there are legal or operational constraints this not only means full integration with employee teams and squads, required access to strategic and tactical information, and participation in appropriate meetings and social gatherings, but also colocation, feedback, conversations and personal interaction with managers.
So by limiting the objectification of workers, trust is often increased and the organization can be a more productive and enjoyable place to work for everyone. Consequently, companies the organization contracts with finds the business collaborative and easy to work with. This motivates them to send their best people.
Collaboration And Results Over CYA
The best statements of work are often flexible and adaptable to changing needs, even with the legal implications or limitations this often imposes. Traditional contracts far too frequently create inefficiency and unproductivity. A supplier who insists on traditional, hyper-detailed work output contracts that limits collaboration may be one to avoid. I will certainly continue to be discriminating. I encourage you to be too.