Call it freelance contract working, gig economy, moonlighting or freelancing, it is increasingly becoming mainstream. More people want to be freelancers – work on their own terms, choose the kind of work they do and work from places that they fancy.
Coworking spaces, fast wi-fi connections, and freedom are some of the basic necessities that freelancers think about. But what about the freelance contract?
However promising, the freelancing economy is far from organized. Freelancers often experience hitches: fraud, withheld payments, unreasonable negotiations, legal issues, or ambiguous verbal agreements. In a number of cases, these issues arise even when there’s a freelance contract signed by both parties.
At times, it can be tempting for freelancers to haste into projects. Formalities might seem unnecessary and there might not be enough time to read the contract thoroughly before signing it. But a little caution and attention can help a great deal.
Writing a contract doesn’t need to take a huge chunk of time. Indy offers a contract tool that can help you write a new contract in just a few minutes. Here’s what Indy offers freelancers:
- The contract tool is built around a simple, wizard-based content editor. There’s no steep learning curve, no special language, and no need for legal training. You can add the elements of your contract with just a few clicks.
- Each contract element can be altered to suit your needs. There are preformatted blocks for deliverables, estimates, and terms and conditions.
- Indy’s contract tool also features an integrated e-signature function. Once your contract has been signed, it can be stored in Indy’s system and kept with your other project files.
Imagine how you can impress potential clients with professional documentation offered in a short amount of time. Indy’s Contracts tool gives you the ability to create great documents in record time so you can do more work for your clients.
Here are 9 key ingredients that freelancers must include in the freelance contract, to stay safe:
1) A formal introduction
Formal introductions might seem boring, but ensure that both the concerned parties know with whom they are working. Moreover, it establishes the purpose of the agreement, provides an overview and clarifies the roles of the parties involved.
The introductory statement should specify a few things:
the name of the client,
the name of the freelancer
what the freelancer would be doing for the client.
the important dates – date of commencement and the expected or mutually agreed to end date.
Freelancing is a two-way engagement. Freelancers are expected to provide services and clients might be expected to provide information. It is critical to mention all the expectations of both parties. The purpose: to have clarity before the freelancer begins work.
- Freelancer deliverables
This particular section should mention what the freelancer is agreeing to provide to the client and the delivery dates. A bullet-pointed deliverables section will ensure that no important points get missed out.
- Information needed from the client
Depending on the nature of the project, this section should list down clearly, what the freelancer expects from the client: information, material to work with, reference material for research and more. This section could also list down points that have already been discussed verbally with the client.
- Monies and payment terms
The beginning of this section should state the amount of the fee mutually agreed upon between the freelancer and the contractor. This should be followed by the terms and conditions of the fee and payment.
The payment method of payment (cheque, bank transfer, cash, any other), the amount of payment at different stages of completion of work (advance, part payments, and final balance payout) and other terms related to the commercials.
3) The scope of the project
Ever heard of “scope creep”? It is the situation where a project gets extended beyond the initial agreed-upon factors. Some clients ask for added deliverables and make new requests mid-way through a project. That’s why establishing a clear scope of the project/work is important.
It acts like a piece of written evidence, it ensures the freelancer’s work and deadlines are not disturbed because of the client. Once the freelancer completes all tasks mentioned in the scope, that particular contract is over.
In case, the client wants to add more to the scope, the freelancer can add a phase two to the project, with added fees. Keeping it simple and clear helps.
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4) Changes, revisions, iterations
Depending on the nature of the service that a freelancer is providing, clients might expect changes, revisions, and iterations to the work submitted. A freelance writer, for example, might have to edit or re-write a text upon the client’s feedback. A designer might have to change the color scheme based on the client’s reaction.
However, freelancers need to understand that their time is valuable. Every iteration costs the freelancer time and effort and that is to be respected by the client. The freelance contract must clearly state how the freelancer will deal with the client’s request for changes.
Clients can be picky, strange, sometimes not know what they want and can be perfectionists. But so can freelancers be – perfectionists. Some freelancers charge for every round of iterations. Some limit the number of iterations to two or three and charge more for any extra revisions. Fair enough. Isn’t it?
5) Legal and copyright matters
The legal and copyright points in a freelance contract are to protect the freelancer from any kind of problems that might arise during the contract period. If it’s a big project, it is better to involve a lawyer who can help put down all the important legal points.
Otherwise, freelancers should wear the lawyer’s hat and put together the critical legal and copyright points. After all, not every freelancer is as lucky as freelancers in New York City. (Freelancers in New York are protected under the Freelance Isn’t Free Act.)
6) Extra expenses, taxes, and additional costs
Clarity about costs and expenses is a must. When it comes to extra costs over and above the fee, such as taxes, GST, travel costs, food expenses, expenses of hiring a space to work from and others, freelancers should leave as little discrepancies as possible.
Freelancers should give an estimate with a breakdown of these costs and put them down clearly in the contract. This will help in avoiding any disagreements regarding money matters.
7) Termination terms
The contract should provide both the parties – the freelancer and the contractor – a safe way to terminate and exit the agreement if things go bad. Some important details to include in this section: notice period, terms of payment under such circumstances, refunds if needed.
8) Point of contact
One way to avoid misunderstandings and confusions is to have one point of contact. This is important especially when the contractor is a company and not an individual. Here’s an example. Sara, a freelance interior designer was designing a duplex for a couple.
Halfway through the project, she realized she had been caught between two different preferences of two different persons. This had affected her deadlines and work process. By having a single point of contact, freelancers reduce communication chains, save time, energy and can have much smoother work experiences.
9) ‘Kill Fee’ clause
Sometimes, due to unexpected circumstances and reasons that cannot be controlled, projects can get cancelled. In such cases, freelancers are at the risk of not getting paid for the effort and time they might have already put in. A kill fee clause can save freelancers. Different freelancers have different kill fees, depending on the nature of the project.
As much as freelancers prefer doing things perfectly, their work life and methods can’t always be seamless. This because every new project they take could be of a different nature. Keeping the above points in the freelance contract can help freelancers stay safe through projects.
If you are a freelancer, read more about things you must know.
Legal Rights And Precautions That Every Freelancer In India Must Be Aware Of
A Step-By-Step Guide On Tax For Freelancers In India
How To Ensure You Are Paid Timely As A Freelancer