The Importance of a Strong Contract — How to Protect Yourself and Your Client From Day One

First of all, what makes up a Freelance contract? And why should you care???

Okay, so what are freelance contracts? When you decide to take on work for someone, you’ll want to know what they expect of you and in turn what you should expect from them in the relationship. Essentially it attempts to address all of the possible questions or issues that are likely (and unlikely) to come up throughout the work and agrees to solutions ahead of time. 

Freelance contracts can cover whatever you want them to, as long as the other party agrees and signs. Do you want all of the brown M&Ms picked out of your candy dish? Put it in the contract (seriously–google the Brown M&M Test). Now, that is sort of ridiculous, but you get the point. If it’s not initially put in the contract, it essentially doesn’t exist and neither party has any recourse against the other. This isn’t to say that things won’t come up that you or your hiring entity may decide need to be adjusted or changed, but you are not legally obligated to if it’s not already written in. 

There are many times when you may go outside of the scope of a contract but the point is that you don’t have to. And if it’s starting to feel like you’re being taken advantage of, that’s when you’ll be glad to have a solid, well-written contract. 

Why should you care?

Strong freelance contracts are the only way to truly establish boundaries. They’ll determine things as seemingly mundane as how you’ll communicate. Do you want a client calling your personal phone at midnight on a Tuesday asking for the latest edits? Or knocking on the door of your home to show you the latest images they want you to replicate? These nightmare scenarios are easily avoided with a solid contract.  

Freelancers will oftentimes enter into a working relationship without a contract for a variety of reasons. They might think that well, it’s just a small task that won’t take too long and is hardly worth the trouble to have them sign off on something. Or maybe it’s a big project for a friend or relative and you feel it might be bad form to even ask them to sign something. I cannot impress upon you strongly enough that YOU SHOULD ALWAYS HAVE A CONTRACT IN PLACE. It just makes everything easier all around. 

Let’s say you agree with a client to put in 15 hours per week, but now one month into the project they’re expecting 30. If you have any hope whatsoever to stay within the agreed-upon parameters, it needs to be in writing. Imagine standing in front of a judge without a contract and arguing about it. It’s just he said/she said at that point, and unless you have a phenomenal lawyer you’ll likely leave unhappy. 

Having the conversations and negotiations up front will save you so much grief down the road and smooth the working relationship for all parties involved.  

Who needs it?

YOU do. A lot of people seem to feel that a contract is subtly telling the other party that you don’t trust them, but that is just pure silliness. You should put that out of your mind immediately. A contract shows that you respect the business relationship enough to invest in establishing its boundaries. If they have a problem with it, that might mean that they don’t respect yours, and you should proceed with extreme caution, if you proceed at all. 

Depending on what work you pick up, they may ask you to sign their contract. Relax–this is normal. But there are some things you’ll want to make sure you do before inking that paper. First of all–READ IT. All of it. We’re inundated all day every day with massive boilerplate fine print that we casually check the box on and move on with our lives, but this is where I implore you–do not treat your freelance contracts the same way. Once you sign, you are legally bound to uphold whatever you promised in writing. 

Secondly, don’t be shy about asking to add or remove aspects of the contract that are lacking or that you disagree with. Contract negotiations are common and expected, and that is the time to lay out all expectations for each other to see, not after signing.

I cannot stress enough that you will need a contract to protect yourself, no matter who or what or how large or small the project. 

When should you have one?

Let’s say you’ve been handpicked to do some work for an organization. You’ve had a conversation or two and have gotten a feel for each other and decide you want to work together. When do you broach the subject of a contract? 

A contract shows that you respect the business relationship enough to invest in establishing its boundaries.

Essentially, once you have both decided that you’re a good fit for each other, it’s time to enter contract negotiations. If you’re asked to just go ahead and get started on the work and that you’ll get to the contract later, I would be extremely suspicious. Under no circumstances should you start work until a mutually agreed-upon contract is signed. Chances are unlikely that this would happen, as a contract protects both entities and most organizations are professional enough to appreciate it, but it’s important to stay vigilant.  

How to make one?

Now that you know you need a freelance contract, how do you write one? Luckily for you there’s a ton of them out there, free of charge for you to use. Be forewarned–some are terrible, some are focused on a specific industry and may not apply to you and your business, and many if not most are written by writers, not lawyers. But there are also a lot of really good ones out there that have a good framework for you to begin with. 

You should always have a lawyer look at any contract before you sign, though for a lot of small businesses or sole proprietors that’s not possible or practical. Even having a lawyer look at it does not guarantee that a judge won’t ultimately rule a different way, but having that contract signed even without a lawyer to look at it offers you a great deal of protection. 

We here at Virtualcopia have created a freelance contract template specifically for freelancers and entrepreneurs that is free for our members to use. While you can certainly use it as is, we recommend that you thoroughly read it over and customize it to meet your specific needs. 

What needs to be covered?

Description of services

This is where you outline exactly what services you’ll be performing for the hiring entity.  Whether you’ll be managing email accounts, social media, human resources, or whatever–this is where it is written in. If you’re asked to drive to their house and water their plants and take their Bernese Mountain Dogs for a walk, you have every right to decline, per your contract…unless they buried it in there next to the brown M&Ms and you signed it. Setting boundaries is absolutely paramount, and the contract is where those are delineated. If you’re being hired for your professional skills you don’t want to be stuck being a gofer, right? 

It doesn’t need to be in elaborate prose either–it should be clear and concise and encompass whatever you’re agreeing to do. Simple language is fine; preferred even. And that goes both ways. If they’ve amended your contract and included language you don’t understand or vague terms, it’s your right to ask for clarification and to rewrite it as such so it’s clear to all. 

Deliverables

Simply put, deliverables are the output of services. Say that you’re contracted to write monthly 2000-word blog posts for a client. The deliverable would be the piece that you wrote and sent along. 

As you may have already noticed, there were almost no guidelines at all about the scope of the work beyond the 2000-word length. In this scenario, it would be wise to set up some boundaries on the scope of your work such as:

• How many edits or revisions are included?
• How much will you charge outside of the included number of edits? 
• What actually counts as an edit? You need to specify what that means in the freelance contract so there will be no misunderstandings. You might consider a rewritten paragraph or two to be reasonable, whereas the client might think a change of topic at the last minute and a total rewrite of the entire piece is. 

In a freelance contract, wording counts. You may want to specify that the client gets “UP to X amount of edits (so they don’t ask for a discount for requesting fewer edits),” and “any edits or revisions beyond will cost Z amount each.” This serves two purposes: so the client knows how many edits and what it will cost them if they go beyond that.

Project schedule

Some projects are finite and have hard deadlines in place before you’re ever even a twinkle in the recruiter’s eye. However, it’s very common for there to be a somewhat more ambiguous end date. As you get your business off of the ground and start accepting more and more clients, it becomes hugely important that you start to structure your time so that you don’t start overlapping projects and overwhelming yourself with work. Having a lot of work is a good problem to have, but you don’t want to kill yourself or let your work suffer because of poor scheduling. 

Here’s where you’ll set the expectations of how long or short the contract is and what kind of hours you would expect (or be expected) to put in. Maybe it’ll be a three month project for the client, but they only need five hours a week from you throughout that time. Establish this at the outset to keep your own schedule organized. 

Some other things to consider here are:

• Restart fees. Clients have their own lives and issues, and sometimes projects get pushed back or halted for some reason or other. What kind of timeline hiccup you deem acceptable is up to you (one week? Two? Three?), but put it here in writing. Your time is valuable! You’ve cleared your schedule for their project and shouldn’t have to wait indefinitely for them to get back to it. When they do decide to begin again after a pause, you may want to charge a restart fee. 
• Sometimes you’ll reach out to clients and they simply won’t respond in a timely fashion. The same applies as above. You just need to decide how you will proceed if you’re ghosted, and if and when to invoke the restart or kill fee. 

It’s helpful to have some email templates as well for exactly this situation. Here at Virtualcopia, we have created a couple of “sticky situation” email scripts that address these and other scenarios. 

Preferred means of communication

Your preferred means of communication is exceptionally important to set down in writing. Everyone has their own style of communication that they’re comfortable with and prefer. Make sure that you and your client agree early on to whether you want email, in person, Zoom, business phone, or any and all of the above. 

Set up standard availability or office hours as well. If you don’t want your client calling you and expecting you to answer at three in the morning, you need to put your available hours in the contract. Plenty of entrepreneurs and freelancers use only email or their CRM platform to communicate, and that’s fine, as long as the client is amenable to it. We strongly advise that you never give out your personal phone number to clients. You don’t want to break that wall between your personal and professional lives. 

It’s worth putting a clause in about billing for communication hours as well. If you have a client that likes to free-associate and ramble on hours-long phone calls, you shouldn’t be doing it for free. 

Pricing and rates

I don’t think I need to tell you how important this category is. You are, after all, a business, no? There are several different ways to charge for your services. Some like to do it by the project, some charge by hours worked, but however you choose to charge, you need to explicitly address it in the contract. You’re going to charge for your services rendered, naturally, but it’s good to cover other anomalies such as: 

• Late fees (we’ll get into this a little further down).
• Rush fees. There’s nothing wrong with giving your client some flexibility, but their lack of preparation does not automatically translate into your problem. You may decide to waive these types of fees, but the clause protects you if it becomes a problem.
• Kill fees. Sometimes a project is canceled, loses funding or someone just changed their mind. You’ll need a clause in there to ensure you get compensated for the time and effort you have put in thus far. You did the work, you are owed the wages. 
• Include a contract termination clause that addresses how to proceed if either party wants to cancel the contract. This should include how much notice should be given. 

Payment terms and schedule

Ahh, the good stuff–getting paid. It should be a mutually pleasant exchange of goods or services for compensation for a job well done. And it often is. But you want to make sure that both parties know how the compensation will exchange hands and what timeline to expect it to happen. 

Your contract should firmly state that you will not issue any refunds for deposits or completed work. This is industry standard, and a client should know this, but it must be in writing. There should also be a clause in there that addresses if they don’t respond to you for some time or break the project schedule that you are under no obligation to just pick up where you left off and start their project again. This goes back to what we talked about earlier–your time is valuable, and if you choose to work with them again after a hiatus that they instigated, it should be on your schedule, not their whim.

Jurisdiction

As a freelancer or small business owner, you’ll often find yourself working for clients in other states, and it is crucial to note that a contract is subject to the laws and regulations of the jurisdiction from whence it came. For example: if it’s your contract that a client signs and returns to you, it’s under the law of wherever your business is established. If you sign their contract, it’s under theirs. 

Finally…

What are freelance contracts for, if not to lay down the rules and boundaries of the working relationship to come? I cannot recommend strongly enough to have a lawyer look at it, but even without professional perusal, having that signed document will go a long way toward backing your claims in a court of law. 

Lack of a contract can ensnare you in nightmare scenarios that can have lasting and devastating consequences on your business and your morale. 

Conversely, a well-written contract is a beautiful thing that can serve and protect all parties involved. With some luck, it won’t be the last contract you sign with them. 

This article is for informational purposes only, and is not to be construed as legal advice. All contracts and templates should be vetted by a legal professional in your own jurisdiction.