If, on the one hand, the freelance life allows you to organize your time as you prefer and to personally establish the conditions under which you intend to work, on the other hand, one of the disadvantages is that that of freelancers is one of the categories that suffer most of all the failure to pay for their work. For this reason, we believe that it is essential for every freelancer to sign a contract before starting any job, to protect themselves from bad payers and the risks of the trade.
Not to mention that a contract will also allow you to:
- Establish the goals to be achieved before starting work.
- Overcoming the client’s objections regarding payment, deadlines, reviews of the work performed, etc.
- Charge any extra work that was not foreseen in the project’s initial planning.
In this article, we will therefore talk about the importance of a freelance contract by touching on the following topics:
- Do all freelancers have to sign a contract?
- What are the clauses that a freelance contract should have
- Tips for your freelance contract
- Freelance contract templates
- Information on how to handle any contractual violations
Note: This article offers some general tips but is not intended to substitute for expert legal advice. Therefore, always check local regulations and contact a legal expert if necessary.
Do all freelancers have to sign a contract?
In reality, no one is obliged to sign a contract, but doing so certainly protects you from the possibility that something goes wrong during the execution of your assignment.
You probably don’t need a freelance contract if:
- You are a hobby freelancer.
- Your freelance business is not your primary source of income.
- You accept only minor, short-term assignments that do not involve a large sum of money like the best nz online casino site.
Instead, you should subscribe to one if:
- Freelancing is your full-time job.
- Your freelance business is your primary source of income.
- You work on high-value projects that take weeks or months to complete.
What are the clauses that a freelance contract should have
The terms of your freelance contract depend on the work you do. For example, do you need to sign a contract for each order you accept? Do you prefer to establish a partnership agreement for regular clients or Terms and Conditions for the client to sign before starting the project? Below we illustrate the main clauses that should not be missing in your freelance contract (for more specific information, always contact a legal expert).
Essentials of a freelance contract
1. Tariff and terms of payment
This section has to establish how much and when to get paid. Do you need an advance at the time of the assignment, full payment in advance, or do you prefer to establish payment deadlines during the project? For example, freelance writers usually require a 50% down payment upon confirmation of an assignment and the balance upon completion. This allows them to have some liquidity available from the start and a kind of buffer if a client cancels a project that has already started. According to casino machine à sous en ligne, it’s a good practice for freelance contracts.
“Why should I pay you in advance?”
This is a common objection that you will hear from clients or the administrative departments of companies who are unwilling to pay you for work not yet delivered. Think about these words when you answer: if you are a freelancer, the product your customers pay for is your time, and this is not an unlimited resource. Your customers should agree to spend at least a portion of your compensation upfront on securing some of your time. If they don’t, you could efficiently devote your time to others.
2. Penalties for late payments
What happens if a customer does not pay within the agreed time? Unfortunately, this happens very often to freelancers. We recommend that you establish in your contract any interest to be paid in the event of late payments, both to protect your earnings and to incentivize customers to pay on time. For example, you could charge 5% of the total amount every 14 days of overdue payment of the invoice, but be sure to make this clear to your customers before proceeding. You should write it down on your contract and make sure it’s reasonable interest (don’t charge a $ 50 penalty on a $ 100 job!). Additionally, you might also want to think about granting a discount to those who pay you before the deadline.
3. Counting the extra work
If your compensation is fixed on a flat rate and not an hourly basis, what happens if there are changes in position? We talk about additional work when a project’s requirements exceed those defined initially. This often translates into more work for the same price for freelancers, which is what clients expect. So remember to set out precisely the details of your assignment in your initial contract to have something to stand for in case your client asks you for extra work. Also, decide how to count any extra work: will you calculate it hourly, or do you reserve the right to process a new quote for the entire project?
Not sure if you’re charging enough for your freelance work? Find out how to check if you are setting the correct rate for your job.
4. Copyright and ownership of the work done
Who owns the rights to your work? When you are an employee, these usually belong to your employer, be they photographs or ideas you bring to a business project. When you are a freelancer, ownership of your work is yours until you transfer it to your client, and you decide in your contract if and when this should happen: upon delivery of your final draft, the entire balance by the client or at another time. Also, remember to establish how far the client’s ownership goes: is it limited to your final draft, or does it extend to all the ideas you have come up with throughout the project? If you are unsure of how to go about it, we recommend that you check your country’s copyright law and consult an expert on the subject.
5. Inclusion of previous works in your portfolio
Showing off your skills through your previous jobs is the best way to win new customers, but if you want to use the work done for your customers to promote yourself, you need to ask for their consent first. For example, if you are a copywriter, you could add a clause to your contract that authorizes you to use some extracts of work done for other clients for promotional purposes. Your new clients shouldn’t be surprised; they will have chosen you after looking at your portfolio.
6. Cancellation policy and penalty
What happens if a client cancels the assignment suddenly, before, or during a project? In your freelance contract, you should clearly state whether or not you authorize the cancellation of the work and, if so, under what conditions (in terms of time and money). If you have an ongoing partnership agreement, define the required notice in the event of cancellation by both parties, such as six months for long-term contracts or thirty days for auto-renewing contracts.
A cancellation fee is also helpful to protect yourself if a client cancels a job you have already dedicated a lot of your time to. It usually corresponds to a percentage of the project’s total value and is used to cover the time spent on the project up to a certain point in time. If a client cancels a job with little advance and by now you cannot make up for the consequent loss of earnings, a penalty will allow you to return the money that you should have earned thanks to the canceled project.
7. Policy for any injury or illness
What if suddenly you are forced not to work for some time? No matter what your state of health is, each of us can happen in our career to have to leave work temporarily, whether due to illness, to look after someone, or for other reasons. Therefore it is essential to establish a procedure to be adopted in these cases and ensure that you clearly state this in your contract. For example, you may reserve the right to transfer your assignment to another freelancer, postpone the delivery date, or offer your client a full or partial refund.
Beyond the safeguards you could ensure with your contract, you could take measures to avoid being caught unprepared in illness or other unforeseen circumstances. For example, you could set aside a certain amount each month to deal with emergencies or take out a health and accident insurance policy covering part of your lost earnings in certain circumstances (be careful because some may not cover your total revenues).
8. Changes and revisions
Everyone will have happened to deliver a job and immediately receive endless requests for changes from the client. Without an explicit clause in your freelance contract that governs the changes and revisions process, it’s easy to get caught in the endless change trap. We, therefore, recommend that you provide several revisions included in the initial price of your assignment and a possible fee for each change to be made beyond the established number. Freelance writers usually review the project’s cost and subsequently charge for any changes hourly. Remember always to enter a time limit for requesting revisions to prevent customers from returning after weeks when you are already working on another project.
9. Your status as a contractor
As a freelancer, you are not an employee, although some clients will indeed be tempted to treat you. Your freelance contract should clearly define what it means to be a contractor and not an employee, namely flexibility in hours, freedom to set deadlines and choose which projects to work on, and the absence of sickness and paid holidays. If in doubt, take a look at your country’s legislation.
10. Your main contact person
This last point does not necessarily have to be included in your freelance contract, but it will undoubtedly make your life easier: who will be the primary contact for a given project? Having a person on the customer side dedicated to answering your questions, paying your bills, and checking your work will undoubtedly facilitate your work and meeting deadlines. In particular, it is helpful if you work for large organizations or if there are a lot of interested parties.