Its basically the same as in the real world without the online… 
Although you work online with people, you have a written contract that documents the duties and fees of both parties.
Most likely you would have several such documents, such as:
- The non-disclosure agreement. It ensures that the employee is not leaking project information or other internal methods of the company.
- The working contract. It defines the scope and timeframe of the workload, the financial aspects and other relevant stuff like mandatory work in progress updates, etc.