Derrick Story's 22-minute tutorial, "Photo Assignment: Natural Light Portraits," on lynda.com, gives a brief explanation of what to do when shooting portraits outdoors, in the middle of the day, using only sunlight. Shooting directly under mid-day light tends to create problems such as hot spots, placing eyes and the smile in shadows, exaggerating skin texture, and highlighting the nose. He states that overcast light is the safest outdoor light because it mutes those effects, yet still provides some highlights on the hair.
To begin shooting an outdoor portrait, he recommends using a telephoto lens with a DSLR (or telephoto mode in a compact camera). DSLRs should shoot in "program mode" and "burst mode." Also, to get a softer background, the aperture should be opened up and there should be some distance between the subject and the background.
He demonstrates with a photo shoot that, when shooting in the middle of the day, the subject should be under open shade (e.g., either under a tree or a white diffuser). Photo discs/reflectors can bounce different types of light back onto the subject (white, metallic, ambient) to lighten up shadows. When in the shade, he advises toggling the white balance to either "cloudy" or "shade" and to switch from evaluative metering to spot metering. Also, he recommends dialing down the exposure compensation when shooting darker skin.
The tutorial concludes by viewing the shots on a computer and comparing the results of moving the subject to shade, bouncing light to the subject's face, and varying the type of reflected light. He encourages having the subject experiment with unplanned poses for variety. Lastly, he links to a Flickr group where students can post their own natural light portraits.