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Need help with a Freelance Contract?
As a business owner, it is vital to protect your rights when engaging with other parties. Your freelance contract ensures that both sides understand expectations and how to meet them. This strategy will help you maintain fruitful, productive business relationships.
Keep reading for everything you should know about freelance contracts:
What is a Freelance Contract?
Freelance contracts, also known as independent contract agreements, consulting agreements, and service contracts, are legal contracts that set the terms and conditions between a company and a freelancer. A freelancer is a legitimate business professional who provides specialized services beyond the ordinary course of the company’s business. Companies find freelance contractors through headhunters and labor marketplaces.
Should Freelancers Use Contracts?
Freelancers should use contracts to protect their rights and business when engaging with other companies. If you question whether you need one or not, consider this scenario:
You are working with a client who disputes your work. Ask yourself the following:
- Do you have proof the relationship exists?
- Could a reasonable person find the terms between the two parties?
- How could you prove to a judge that the other party agreed to the terms?
If you only work on a verbal contract, then the answer to the above-referenced questions is “no,” at least not initially. Business relationships that lack contracts are far more expensive to dispute or litigate than written ones in some cases. Ensure that you put your agreement in writing.
Other benefits of freelance contracts include:
- Easier to prove enforceability versus verbal contracts
- Offers both parties a chance to understand their obligations
- Protects your rights when navigating contract disputes
- Creates a formal and engaged legal relationship
- Prevents “mission creep,” which can create new liabilities
- Gives proof of past due debts in civil court
The benefits of a freelance contract are numerous. However, a contract is only as lock-tight as the person who drafted it. For this reason, many freelancers choose to work with an attorney to help them prepare the initial iteration.
It is a strategy that can help you avoid legal and financial mistakes in the future. This result produces peace of mind for years to come. Always work with employment lawyers when drafting your contracts.
Examples of Freelance Engagements
Freelance engagements typically involve those that are short- and long-term projects. However, companies generally contract with freelancers due to the highly specialized nature of their skillset. Most state labor laws require companies to only work with freelancers that offer services outside of their usual business offerings.
Examples of freelance engagements include:
- An artist creates a commissioned pottery piece
- A freelance journalist writing articles
- Web designers completing a website
- An independent contractor completing home repairs
- Film editors contracting with producers of a documentary
If you provide freelance services, the client must abide by the terms of the contract. They must also avoid exerting managerial control. Otherwise, they risk violating contractor law that protect independent contractor rights and freedoms.
Here is an article about the difference between Independent Contracts vs. Employees .
Important Terms in Freelance Contracts
Freelance contracts should include terms that both parties can understand. They should consist of the core provisions and clauses that are unique to your business and industry, including deliverables and consideration. Although the terms will vary on a case-by-case basis, there are some must-have clauses you should include in your freelance contracts.
Every contract is different. The terms that you include ultimately depend upon the project you are completing and more. However, there are a few standard provisions that every freelance contract should have.
Eleven must-have clauses in freelance contracts include:
- Names of parties and companies
- Recitals and definitions
- Scope of work
- Payment terms and schedules
- Governing Law
- Arbitration Clause
- Liability limitations
- Third-party liability
This list is a terrific place to begin when writing your freelance contract. Some projects may be more or less intensive than others, which means that your specific agreement may require additional provisions. Employment lawyers can help you determine which sections and clauses should go in your contract according to state and federal laws.
Mistakes to Avoid
Freelance contract mistakes can result in time and profit losses. Since your business reputation and legal exposure is on the line, you should comprehensively negotiate the terms and conditions of your contract, including obligations, limitations, and more. Otherwise, you could be left on the hook for liabilities that weren’t originally intended.
Seven mistakes to avoid in freelance contracts include:
- Not detailing the terms and conditions of payment, such as an hourly vs. flat fee
- Forgetting to include attorneys’ fees in disputes
- Signing an unreasonable non-compete agreement
- Failing to define the scope of work for the project
- Forgetting a kill fee or cancellation fee
- Not considering state labor laws vs. contractor laws
- Not defining intellectual property rights of each party
Freelance professionals generally hire an employment lawyer to draft and negotiate their contracts. Doing so will ensure that it is appropriately written and enforceable under state and federal laws. An attorney understands how to craft an agreement that meets your objectives while closing potential loopholes that can stress your contractual relationship.
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How To Write a Freelance Contracts
No two freelance contracts are alike, which means that a boilerplate template generally does not work well for the specialized nature of freelancing. You should write a freelance contract that reflects the specific relationship you share with your client and must have clauses applicable to your situation.
Follow these 11 steps when writing freelance contracts:
- Step 1. Negotiate the terms and conditions with the client
- Step 2. Hire employment lawyers to help you draft a contract
- Step 3. Identify the parties and their address
- Step 4. List the project deliverables to avoid mission creep
- Step 5. Establish a rate and payment schedule
- Step 6. Specify which state laws your contract recognizes
- Step 7. Determine how you will handle disputes
- Step 8. Present the initial freelance contract draft to the other party
- Step 9. Renegotiate the freelance contract if necessary
- Step 10. Arrange for a freelance contract signing
- Step 11. Provide hard and/or digital copies to each party
The above-referenced list is not always the same process for every freelancer or client. Your approach may be more intensive than others. However, a freelance contract is a surefire way to ensure that everyone is on the same page and aware of the limitations when working under a contractual agreement.
Getting Help With Freelance Contracts
Freelance contracts will set the tone for the rest of your relationship regardless of which side you’re on. Employment lawyers in your state are best-suited to guide you through the process and provide legal advice. They can also help you answer questions on the fly as you work with the other party.
A customized contract for your freelance engagements will ensure that you are meeting your business objectives while protecting your legal rights. If a client presents you with one, always have employment lawyers review the agreement for accuracy, enforceability, and lawfulness.
Meet some of our Freelance Contract Lawyers
August 25, 2021
Keidi S. Carrington brings a wealth of legal knowledge and business experience in the financial services area with a particular focus on investment management. She is a former securities examiner at the United States Securities & Exchange Commission (SEC) and Associate Counsel at State Street Bank & Trust and has consulted for various investment houses and private investment entities. Her work has included developing a mutual fund that invested in equity securities of listed real estate investment trusts (REITs) and other listed real estate companies; establishing private equity and hedge funds that help clients raise capital by preparing offering materials, negotiating with prospective investors, preparing partnership and LLC operating agreements and advising on and documenting management arrangements; advising on the establishment of Initial Coin Offerings (ICOs/Token Offerings) and counseling SEC registered and state investment advisers regarding organizational structure and compliance. Ms. Carrington is a graduate of Johns Hopkins University with a B.A. in International Relations. She earned her Juris Doctorate from New England Law | Boston and her LL.M. in Banking and Financial Law from Boston University School of Law. She is admitted to practice in Massachusetts and New York. Currently, her practice focuses on assisting investors, start-ups, small and mid-size businesses with their legal needs in the areas of corporate and securities law.
August 18, 2021
Retired Dentist transitioned to Law, with a special interest in Commercial Real Estate, Startup businesses, Asset Purchase Agreements, and Employment Contracts. I love to help dentists and physicians with legal issues pertaining to licensing, credentialing, employment, and general business-legal questions.
August 11, 2021
T. Phillip B.
Attorney creating plans and strategies to help individuals create, build, protect and pass on wealth.
August 14, 2021
Jim Slattery most recently served as General Counsel at Regional News Network, a large owner of broadcast television stations. Jim is an experienced attorney with broad-based expertise. He is a seasoned negotiator who has been involved in negotiations as complex as the Olympic Games. Jim spent 18 years as Vice President for Business and Legal Affairs at NBCUniversal. Previously, Jim worked in the media industry in various roles at All American Television. Jim’s success can be attributed to his ability to properly analyze data, manage projects, lead teams, develop creative solutions for complex problems, focus on strategically optimizing assets, manage/allocate risk and collaborate with divergent constituent groups to achieve objectives. Jim received a J.D. and a B.B.A. from the University of Notre Dame.
September 19, 2021
I’m an attorney focusing my practice on concierge corporate and intellectual property law for startups and high-growth companies. I also serve as outside General Counsel to several businesses in various sectors. Since founding my practice I've worked with hundreds of clients across a variety of industries. My experience as a former General Counsel of a premier edtech company gives me unique insight into the challenges my clients face and how to resolve them efficiently and cost-effectively.
August 18, 2021
The Law Office of George K. Fuiaxis, from the very beginning in 2002, has built a reputation with its clients as an unmatched, diligent, hands on law practice that is always on duty to find the best course of action for its clients. With a supreme pledge of exceptional service to its clients in the areas of Real Estate (Commercial & Residential), Loan Modifications, Intellectual Property, Corporate Law & Business Transactions, Wills, Trusts & Estates, the Law Office of George K. Fuiaxis creates solutions for the many faceted problems faced by its clients. The office represents several various clients, including well known lending institutions, foreign and domestic corporations, sellers and buyers of residential and commercial real estate, residential and commercial landlords and tenants, well known restaurant and business owners, automobile dealerships, airline companies, well known fashion, sports and entertainment industry individuals and corporations, information technology (IT) startups and well known IT companies.
August 23, 2021
I'm a business law generalist with over 24 years of experience, including as in-house General Counsel, as outside counsel through my own firm and as an attorney in an Am Law 100 law firm. My employers and clients uniformly appreciate my ability to (i) negotiate and close transactions quickly and effectively, and (ii) to make the complex simple. Among other things, I can efficiently assist you on entity formation, governance, and structure; HR issues; mergers and acquisitions; and the negotiation and drafting of all types of commercial contracts. I'm the proud recipient of multiple Martindale-Hubbell Client Distinction Awards given only to the top 5% of attorneys for quality of service.