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You delivered your materials to your client, and haven’t heard from them since. You’re disappointed because you’re just starting out and you’d really love to get a testimonial from them that you can use in your marketing. But even more upsetting is the fact that they still haven’t paid you.
They’ve ghosted you, and you don’t have a contract in place that’s legally binding to hold them to that payment.
You’re kicking yourself for not requiring payment before delivery, but you didn’t think it was necessary and felt like you should deliver the materials they’re paying you for before they handed over the cash. Otherwise, they wouldn’t work with you, right?? Actually, prepayment is not uncommon, and is one of seven payment terms every contract needs >>
While having the client pay you upfront would have prevented this situation, a strong contract that included clauses about payments and disputes would also have you able to recoup those losses. Since you didn’t have a contract in place, there isn’t much you can do to ensure this client actually pays their bill.
Sadly, this scenario is just one of many examples as to why it’s so important that every freelancer has a strong freelancer agreement in place.
Want to make sure your bases are covered and you’ve got all of the important legal parts in place? Grab our free No-Nonsense Checklist to Starting a Business and make sure you’re covered >>
Freelancer agreements are a contract between yourself (the freelancer) and the client that is hiring you for the project.
If you’re self-employed and provide services to clients on a project basis, you’re a freelancer. If you work with clients on a longer-term basis but are still self-employed instead of being an employee of a company, you would be considered an independent contractor. What’s covered in this article still applies to you and is important to know, but there is a slight difference between the two.
For example, freelancer agreements and independent contractor agreements will vary in the nature of the work (a one-off project vs ongoing), but things like payment terms and structure, intellectual property rights (who owns what’s created), and what termination of the contract looks like will usually look fairly similar.
Unsure if you’re a freelancer/independent contractor? This blog post will help >>
As a freelancer, it’s important to have an agreement in place to protect yourself, but also to protect your clients. Just as it protects you, the freelancer, from something going wrong, it also protects the client in the same way. Which just makes everyone feel a lot better about the partnership you’re creating.
Now that you’ve decided you need a freelancer agreement, what should it include?
When it comes time to create your freelancer agreement, there are 5 key elements that you will want to make sure you have in place in order to protect both yourself, and your client. Those are payment terms, scope of work, confidentiality clauses, intellectual property ownership, and termination clauses.
As we’ve already discussed, if you’re doing work for a client, you want to ensure that you’re being fairly compensated, and compensated on time. This means an important aspect of your contracts with clients are your payment terms. Depending on your situation, you might want to consider adding the following to your contracts:
Having these terms outlined in your contract not only make it clear to everyone what specifically is involved with payments, but it also backs you up should there be any disputes about payments in the future (such as a client ghosting you without paying). Read more about payment terms that every contract needs if you want to get paid >>
Having a scope of work within your agreement helps to make sure both parties are on the same page about exactly what deliverables there will be, and when they will be completed. This prevents disappointment and frustration on both sides, and makes meeting expectations a piece of cake! For this part of your contract, you may want to include and cover:
Having your scope of work clearly defined also makes it possible to easily tell a client when a request is outside of the scope of your work, because you can simply point them to the contract they signed. Struggling with clients wanting more than outlined in the scope? Here’s how to handle scope creep >>
Often, when working on a project for a client, you become privy to confidential information such as proprietary information on how that client runs their business, or customer data. Having a confidentiality clause in your freelancer agreement helps to protect your client’s interests, and gives them peace of mind that you’re someone trustworthy to work with. Inside of this clause, you might want to make sure you include:
Intellectual property is an intangible creation of the mind that can be patented, trademarked, or copyrighted. (Read more about trademarks vs copyrights.) If you’re working with a client in which intellectual property will be created, you will need to spell out very clearly in your contract who that intellectual property belongs to. You may also want to outline who will own the copyright, any trademarks, or any patents created with this work. And if you are licensing the work, you will probably want to outline that as well.
While no one ever wants to need to terminate a contract, should there be a need, you’ll want to make sure that you include termination and cancellation clauses in your freelancer agreement so that you or your client can back out, if necessary.
In this clause, you’ll want to make sure that you specifically outline what the steps are that will need to be taken in order to terminate your contract. This should be clear for both parties. Some key pieces you may want to include are:
As much as we would all love to never have to terminate a contract, it’s an avoidable part of running a business, so make sure you’ve got yourself covered by clearly outlining this clause in your contract. Read more about what happens when a client wants to cancel >>
The above 5 elements are important parts of any freelancer agreement, as they protect both you and your client. And if you’d like to skip the process of determining exactly what to put in your contract, and how to say it in order to provide that legal protection, grab our Independent Contract Template. In less than 10 minutes you could have your freelancer agreement set up and ready to send to your next client!
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