An increasing number of start-ups and small businesses are now relying on a freelance workforce. However many creative freelancers shudder at the thought of such a left brain task such as creating a client contract! Despite this, drafting a contract that protects both you and your business is a must for all freelancers.
Freelancers do not have the benefit of a legal department dedicated to protecting their interests with a watertight contract. Nevertheless, a freelancer’s contract must be comprehensive, concise and clear. It should outline the scope of the job, scheduling demands, the expectations of both parties and more.
Here are my 5 top points that creative often forget to include in their contracts
- Ownership and use of Intellectual Property
This is often an area that creates the most tension between a freelancer and a client. Therefore, it is key to be clear in any contract who in facts owns the intellectual material upon completion of a task. For example let’s just say you are engaged to design a company logo for client. As a result, you present three different options for them to chose from. However, the client is only purchasing one. Therefore, in the contract you must make it clear which design the client is purchasing, along with the ownership rights of the design and the right to use the design.
- Revisions and alterations
This is an area that can often be exploited by the client. Therefore, you need to protect yourself by including a clause in your contract that clearly states how many alterations and revisions to the product are covered by the fee. In addition, you can also choose to set an increased fee for addition changes which go outside the number specified in the contract. This will go a long way in preventing the client from abusing their privilege.
- Payments and cancellation of the project
The contract needs to be very clear about when payments are due. If possible, ask for a deposit up front to commence the work, and that additional payments are made for key milestones. Many clients prefer to pay ‘ on the go’ rather than receiving a large invoice at the end of the project.
Ensure that your contract also states your cancellation policy. For example if a client pays $3000 for a website design upfront to be completed within 3 months then 2 days later wishes to cancel the contract, you need to determine the amount of refund to be provided.
If you have not started the project then it is common to refund the whole amount less any expenses. However if you have booked out the next 2 weeks in your diary to complete the project then you may decide to refund only a portion of the fee. Whatever you decide, you need to make this clear in the contract and stick to it!
There are two types of refunds you need to consider in your contract. The first is where you collect money upfront and then the client doesn’t wish to proceed or in a situation where you are unable to complete the project.
The second scenario is after completion of the project but where a client complains or is dissatisfied with the work.
It is your choice whether to have a no refund policy once the work has been delivered, or you can also choose to refund the money. However, if you are paying a full refund, the client must not use the work concerned. If the client does decide to use the work going forward then no refund should take place.
Remember your time and skill is the asset that is being paid for by the client. Therefore, be clear on what refunds will be given in what circumstances.
- Expectations and timeframes
Whether you love or hate them, including deadlines in your contracts is important. Don’t overlook this detail simply because of the pressure it may bring. Give yourself enough time to properly complete your tasks, while keeping the client’s timetable in mind.
Being vague about how much time the contract covers will give your client room to find things for you to amend and change even after the project has launched. Also, do be sure to include time frames on when the client needs to respond to your submissions with their questions and concerns, so that you are not endlessly strung along waiting to hear back on how to proceed.
Remember – a contract is there to protect both parties. It should clearly set out the expectations of both parties so that there is no confusion. A well drafted contract leads to good customer relationships.
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