Freelancer Contract: What Do You Need to Know Before?
Think back on the first time you had the spark that set you on the route towards your freelance career, this vivid and beautiful moment of understanding that the traditional job market won’t cut it, and the awesome thought that you have something unique to offer to the world.
At that moment, did you know that the bureaucratic stuff you’ll need to deal with, that distracts you from just doing the actual thing you’ve set out to do, will be so damn confusing?
The legal issues you need to deal with when working as a freelancer or owning a small-medium business, such as taxes, intellectual property, contracts, and internal corporate matters can feel like a full-time job on its own. It’s the last thing you want to spend time on, since being a freelancer or an SMB owner also means you need to deal with marketing, payments, subcontractors and project management before even starting to work on the thing you need to produce.
That is why when things get confusing, you need a little help. And as always, Legally is here to help and guide you through the legal issues you’re dealing with as an independent contractor.
Here is the list of issues your independent contractor agreement should include:
1) Scope of services
Adjusting expectations is probably the most important thing you need to do with your clients (and in any type of relationship, but that’s irrelevant so let’s get back on track here!), and if you want to avoid a lot of frustration later on, you should define the scope of the services you’ll provide and anchor it in your contract. Attach the list of the services as an exhibit to the agreement and both of the parties will have clear idea what to expect.
2) Payment obligations
The obvious thing your contract should include is the amount you’ll be paid by your client, but it also has to include how regularly you should get paid, whether it will be an hourly rate or per-project basis, and when and how the payment should be delivered to you. Also, your contract should include the procedure for negotiating higher or lower rates for future work — not addressing this will leave an opening for the client to pay you less than what you agreed upon if the scope of the work is divided between different contractors without your knowledge. Make sure that this kind of one-sided decision will not be made, and that any changes in payment or projects scope will be discussed prior to the order’s delivery.
3) Confidentiality and non-disclosure provision
If you provide a service type that includes the exchange of sensitive information, your contract should include a confidentiality clause.Most freelancers believe that this clause is principally important from the client’s point of view because he or she is more concerned about protecting its information, but you as a service provider should consider these two aspects:
- It is very likely that you might disclose some information which you might want to protect, especially if you provide some sort of consulting as a domain expert.
- From your standpoint, this clause should mainly protect you from any claims by the client for confidentiality violation. Let’s say that some of your client’s confidential information got compromised, and he accuses you of not handling the confidential information properly, you want to have some clear guidelines to fall back on, that clarify exactly what is considered confidential information (only information that is marked as confidential), and specify when the client should have retrieved the confidential documents, thus transferring the responsibility to the client after the job is provided.
4) Ownership of intellectual property
Whether you are employed by a company or a single individual, it is important to clarify who owns the rights to the finished product, and for how long the ownership lasts. Sometimes you might even want to maintain ownership for part of the product If you use a template on which you build your product, you want to make sure that the ownership for the template remains yours for future use. It is a good idea to clarify that the transfer of ownership takes place only for a complete product and after a payment is made, for a scenario in which the client terminates the agreement; let’s say you’re writing an article for a magazine — you want to be able to use it elsewhere in case it won’t get published. And if we’re on the subject of ownership, let’s talk about copyrights: an important aspect is the identification of whether, despite the client’s ownership, the contractor may republish the item as long as credit is given to the magazine. This issue is increasingly important with Internet publishing and the ease of reproducing a particular item without giving credit, which is plagiarism.
5) Termination rights
For various reasons, sometimes projects get canceled after you’ve already started working on them. The worst thing that can happen in a situation like this, is that you won’t get compensated after you’ve put in the time and work before the notice of cancellation. A termination clause (sometimes called as “kill fee”) makes sure you’ll get paid for the work you’ve already done, and for the time and effort you’d spent on this project instead of other projects you could have done.
Now that you know which clauses should be included, you can draft a simple contract that will serve your interest. Contrary to the popular belief, your contract doesn’t have to look like an official legal document, or be written in indecipherable legalese (an issue which Legally fights ferociously) — a simply written contract will make much more sense and will help both sides with setting the expectations for the collaboration.
With that said, talk to a lawyer before signing anything, Legally is here to help you with that. We will make it faster and cheaper than a traditional attorney. Simply send us your contract, and one of our lawyers will review it and return it to you in less than 48 hours, for the most affordable price you’ll ever find!
This article was originally posted on the Legally blog: (https://www.legally.space/blog/legallized-your-next-uber-ride-will-not-be-the-same)
If you would like to understand your legal documents before you sign them, please visit www.legally.space.