Do I Need A Freelancer Agreement?
We’re living in the age of the gig economy, and the solo-prenuer is its champion. More and more Americans are kissing the 9-to-5 day at the office goodbye and putting their creative passions to work on a project-by-project basis instead.
It’s an exciting time to be an independent worker. But because freelancers are on their own, they must be their own best advocate when it comes to administrative responsibilities. Without the benefits of a human resources manager or accounts payable team, it is imperative that today’s freelancer enter into an enforceable written agreement with each new client in order protect their interests and get paid. While these types of contracts may vary from industry to industry, below are some basic recommendations as to what should be included in a freelancer agreement.
Rates or fees for services:
Most freelancers have at least one story about the time that they didn’t get paid for the work they completed and how they wished they had a signed a freelancer agreement. Regardless of the type of work requested, it’s important to include a section on pricing and payment schedules. Make hourly rates and flat-fee costs clear. If charging by the hour, consider including a minimum and maximum work-hour clause. For example, “Project Artwork won’t take less than X hours and no more than Y.” The X is for the freelancer’s security – these hours will be billed even if the project finishes early. The Y is for the client’s security. The client will pay no more than Y no matter how long the job takes. Spell out a payment schedule, too. Explain whether payment will be made by check, PayPal, or credit card. Without explaining pricing and payment, freelancers run the risk that a client might misunderstand how much he owes, or worse, debates paying the full price at the end of the project.
Deadlines are important to clients, and having an agreed-upon delivery date in advance for the completed project and/or stages of the work can thwart potential frustration and disconnects. Expect the unexpected, and factor in a cushion of extra days—or even a week—longer than anticipated to help alleviate stress. And if the extra time is not needed, then turning in a project early impresses clients and may lead to more assignments.
Savvy freelancers know the dangers of “scope creep” and take care to limit the number of revisions they will complete. It’s natural that, from time to time, clients will request changes to draft work, and that’s okay. But without specifying limits upfront, a project may take far longer than expected. This decreases profit margins, impacts work on other projects and may cause a freelancer to turn down new assignments. To keep expectations clear, offer one or two revision rounds as part of the fee, and bill anything above and beyond that as extra.
If a freelancer or contractor is going to have access to secret company information, include a confidentiality or non-disclosure clause in the agreement. Many clients will require this. These clauses provide penalties for breaching company privacy or using the company’s own trade-secrets against it.
Freelancers and clients enter into agreements with the goal that everything will go as planned. But life sometimes gets in the way. Include a provision explaining what happens if the freelancer or the client cancels the project before it becomes due. The point is to deliver some form of compensation on the work that the freelancer has done but won’t be put to use.
There are different copyright options available depending on the type of freelance work. Writers have the most copyright options such as first serial rights, print rights, electronic rights, and several others. For most freelancers, it boils down to owning the rights until the final payment is made. Copyrighting work is a must to avoid having a client run away without paying or using the work without permission. But it’s also a form of protection for the client. If they have made full payment, they have already bought the copyrights and should expect to not find the work done anywhere elsewhere.
Find better clients:
Finally, freelancers find and keep better clients when they put their agreements in writing. Prospective clients recognize professional freelancers and respect that they command professional rates. A written agreement also helps to weed out low-payers and contract-shy, suspect clients. While creating a contract might seem like a formality, in the long-run it helps build a better reputation and relationships: as soon as a freelancer makes it a habit to engage prospects with a written set of do’s and don’ts, he begins to attract higher quality, higher paying clients.