The importance of having a contract with your client
You’re a creator — which means the best use of your time spent is time spent making things. Getting lost in your work is something you love and enjoy, so it’s understandable that you want to dive right into a new client project when it arises. However, as a freelancer it’s important that you and your client establish some rules first through the form of a contract.
Paperwork isn’t as fun as actually making things, but it’s just as important. A project taken on without any form of paperwork is only setting yourself up for a journey of uncertainty, frustration and miscommunication. Not to mention the potential that there’s no binding agreement between you and your client that states they have to pay you.
You’ve already written a proposal which the client accepted, so now it’s time for you to present the client with a contract. But why do you need a contract?
- for accountability
- to protect yourself (applicable for both you and your client)
- for the client to sign off on the scope of the project, and to make it clear what your responsibilities are
You’re not a lawyer. This isn’t what you signed up for; writing contracts, signing documents and swimming your way through paperwork and administration.
No, you’re not a lawyer, but you are a small business owner — and that job title comes with many responsibilities and roles. Being a freelancer means you’re accountable for how you work, how you get paid, what you work on and when. You’ve probably got the most rewarding yet challenging job out there.
Maybe you’ve completed some client work in the past without using a contract and it’s all gone smoothly. Well — that’s rare (and risky). You’re a business owner now, which means you need to treat your freelancing like the serious business that it is. That means legal documents, proposals, contracts and more. If you don’t treat your business with the professional respect that it deserves, how can you expect clients to treat it as such?
Do you think Nike signs contracts with freelancers? Definitely.
If you want to position yourself as the professional creative that you are — you need to be signing contracts with your clients, even if it seems like hard work it’ll pay off in the long term.
Whether or not you’re a procrastinator, a contract is the best way to gain accountability on a project. We’re all familiar with what signing a document means; we’ve all done it so many times that our brain knows that by signing a document we are agreeing to something and creating a binding relationship.
But — people don’t like signing something they don’t understand.
It’s important that your contract be as clear and easy to read as possible. While you do need to include some ‘legal speak’ to protect both yourself and your client, it’s not entirely necessary for it to be written in a confusing way.
Using plain english will help both you and your client understand the relevant terms. Make sure you make everything clear — there should be nothing to hide. If you or a client are unsure about a particular term or section, you should both feel comfortable to speak up and ask questions — it’s never personal
If you’re nervous about some terms in your contract and are apprehensive about sending it off, you may need to re visit your contract terms. Don’t send anything to the client you don’t agree with, or that you aren’t comfortable with. As the freelancer, you need to stand by your contract and stay true to your terms.
During the contract process, you may lose some clients along the way. Don’t let that cloud your mindset: these clients probably aren’t the right ones for you.
Remember that a no always makes room for a new and better yes. Avoid scarcity mindset and don’t alter terms or ‘create leeway’ in your contract because you really want the project. Respect your business and yourself as a professional.
Accountability isn’t necessarily only for yourself, but for your client too.
It’s actually especially necessary for your client as it means they’ll be held accountable to whatever payment terms you agree upon. Maybe you also need additional content or assets from the client in order to begin the project. Stating this in your contract holds them accountable to providing you with those resources in order for you to begin your process and perform the relevant tasks. There’s nothing worse than a project being dragged on because you can’t get started as the client hasn’t given you the assets you need.
Being accountable to the project and specific deliverables help you focus. Including the deliverables in the contract highlights what’s required from you. With this knowledge you can better prioritise your time and ensure you’re working on delivering the right results.
In an ideal world every client project you work on will go smoothly. Unfortunately this isn’t always the case.
Unexpected circumstances can arise, whether intentional or not. Maybe you get sick, or your client has some family matters to attend to which means they can’t get the assets to you that you need. Whatever it is, things beyond our control can happen which could mean you or the client can’t perform or deliver what was agreed upon. Having a clause for these types of situations make it easier to handle what happens in these situations. Having guidance for what ‘the next step’ is makes it a bit more comfortable when negotiating how to move forward.
Unfortunately, creatives work occasionally gets used in a way other than what the intended purpose was for the design. For example you may design a t shirt for an event in 2015 and next year the client uses the design but in an altered way for 2016, without ever contacting or paying you a rights or licensing fee.
Contracts often state that the client is paying for the one time use or application (whatever you agree upon) for the design. This means if you design a website for Company A, they can’t on sell it as a theme to Company B without your permission.
Having a contract is very important when it comes to outlining ownership and licenses as it helps protect you from your work being used additionally without your permission and compensating you.
Rarely, but occasionally, the project may have to be cancelled part way through. Without a contract this can leave some uncertainties:
- Will I get paid for the work I’ve done?
- What happens to the work I’ve already done — does the client get it?
- Who owns the work I’ve done so far?
It’s best to have in your contract some terms about what is expected of each of you if this were to happen. Based on this, many freelancers require a non-refundable down payment before they begin work on the project.
This not only shows the client’s commitment to the project, but also is nice for you when it comes to termination as you’re not left completely un compensated for your time.
Confidentiality is also important to outline in a contract. Maybe you’re working for a large NGO and working with extremely confidential assets or inside information — you need to agree on the terms of your engagement and how you will protect that information.
Sign off on Project Scope
While you probably have already communicated the project scope and deliverables in a proposal, it’s important to reiterate them in the Contract.
At the end of the day, the Contract is the binding agreement — not the Proposal (unless it’s signed). Having the client sign off against the project scope sets in stone the expectations and requirements of you. It’s your responsibility to make sure everything is a clear as possible; the scope, deadlines and deliverables.
Maybe halfway through the client changes their mind about something in the scope. Now what?
Sound familiar? Agreeing upon the scope and boundaries of the project gives you a reference point if/when the client suddenly has a ‘new idea’ half way through a project.
If you say yes to changing one part of the scope, this can easily snowball into changing another and another before suddenly the scope has completely changed, time is running out and you don’t have all the resources you need in time to deliver the new results.
If a client approaches you after signing to change the scope, by all means this can be done. However only if you both agree on it and sign a document outlining the changes. Standing your ground (in a firm but professional way) is part of the job.
It may feel awkward to do so, but bending over backwards for every client is only going to lead to stress. However, if you and your client have both signed on the scope of the project through a Contract, it’s unlikely they’ll approach you with a request to change it half way through.
The meaning behind contracts
At the end of the day, contracts are a reference point. If the client asks you of something, you can refer to the contract to see whether that fits within the scope. If your client isn’t paying on time, you can refer to the penalties stated in the contract and apply them. Remember that contracts aren’t just for you, they’re for your client as well. You’re both equally held accountable to the terms stated and signed within the contract, so it’s up to you to make sure you fulfil the responsibilities expected of you.
Whenever you’re unsure about something, or a disagreement arises between you and your client — refer to your contract. It should help set the record straight.
When in doubt, ask a lawyer. There are many contract tools online but you’re unique in terms of where you live, what kind of work you do, who the type of clients are that you work for and how your process works.
No out of the box contract is going to be the perfect one for you. If you’re freelancing full time it’s highly recommended you consult a lawyer to help outline a contract for you to use with your clients.
It can be tough to say no to a client, or turn down an idea of theirs when it’s not stated in the contract. As a professional freelancer, remain confident and stand true to your moral values and instincts. If your instinct is telling you that it’s not possible to add that task to the scope as it will cause you to rush when it comes to the deadline — don’t do it. Remember, you’re running a business and business is business.
What it really boils down to: If it’s not in the contract, you’re not required to do it.