A contract for assignments and projects, also known as an independent contractor agreement, are usually written by the client. If you’re an independent contractor, it’s important that you know how to review these contracts in order to protect your interests. This may seem daunting at first, but with a few tips, you can easily review and understand the contract template.
Independent contractor agreements are important to both you and your client — they outline the expectations of both parties and provide legal protection to both sides in case of any disputes. Formal contracts also validate your independent contractor status, which is important for tax purposes.
Tips for reviewing a client’s contract
Here’s what your contract review process should look like:
1. Review the contract for important details
When you receive the written contract, take some time to review it carefully. Read through the entire document and make sure that you understand all the terms and conditions. Make sure you understand the client’s expectations and are able to meet them. Review the written agreement for important details such as payment, work schedule, and project specifications.
Pay special attention to any clauses that may be disadvantageous to you. If you do encounter unfair clauses, try to negotiate with the client to have them removed or amended.
2. Understand your rights and responsibilities as an independent contractor
As an independent contractor, you have certain rights and responsibilities. Make sure that you understand what these are before you sign the contract. For example, you have the right to set your own work schedule and working hours. However, you also have the responsibility to deliver high-quality work that meets the client’s expectations.
3. Make sure the contract is clear and concise
The contract should be clear and concise, without any ambiguity. Checking for ambiguity is especially important if you’re working with a client from another country, as cultural differences can lead to misunderstanding. If there is anything in the agreement that you don’t understand, make sure to ask the client for clarification.
4. Check if anything is missing
As you read through the agreement, check if there are any important details that are missing. To make sure you don’t miss anything here’s a contract review checklist you can use
- The names and contact information of the parties involved. Ensure that the contract lists your name and contact information correctly.
- A description of the work to be done. The agreement should include a detailed description of the work you’ll be doing, as well as any deliverables that are expected.
- The schedule for the work to be completed. The contract should include deadlines for each milestone of the project, as well as the expected completion date.
- The location of where the work will take place. Work location is important because it can affect things like taxes and insurance. It also determines whether you’ll be working remotely or on-site.
- The payment terms. The agreement should state the hourly rate or fixed price that you’ll be paid for your work. It should also include information on when and how you’ll be paid, and the method of payment, e.g. bank transfer, PayPal, etc.
- Any expenses that will be reimbursed. If there are any expenses that you’ll incur during the course of the project, make sure that these are listed in the contract. This could include things like travel expenses, if you’re working on-site.
- The confidentiality agreement. This is a clause that binds you to keep the client’s information confidential. Make sure that you’re comfortable with the level of confidentiality required before you sign the agreement.
- The intellectual property agreement. This is a clause that assigns the ownership of any intellectual property that’s created during the course of the project to the client. Ensure that the client is only asking for ownership of the work that you create, and not any pre-existing work that you may use during the project.
- The length of the contract. The agreement should state the start and end date of the project. If the timeline isn’t listed, make sure to clarify this with the client.
- Termination clause. The contract should include a clause that describes the conditions under which either party can terminate the agreement. For example, if the client is unhappy with your work, they may have the right to terminate the contract. On the other hand, if the client doesn’t pay you on time, you may have the right to terminate the contract.
Always ask for corrections for any errors, typos, or discrepancies within the agreement before signing it.
5. Get the contract signed and dated by both parties
Once the contract is finalized and agreed upon by both parties, make sure that it’s signed and dated by both you and the client. This will make the contract legally binding.
6. Keep a copy of the contract for your records
Make sure to keep a copy of the agreement for your records. This will come in handy if there are any disputes down the line.
Can you add clauses to a contract written by the client?
Yes, you can add clauses to a contract written by the client. However, you should make sure that these clauses are agreed upon by both parties before adding them to the contract. Otherwise, the agreement may not be a valid contract.
What happens if you sign a contract without reading it?
If you sign a contract without reading it, you may be held liable for any terms and conditions that are stated in the agreement. Therefore, it’s important to always read a contract before you sign it.
What should you do if you’re asked to sign a contract that you’re not comfortable with?
If you’re asked to sign a contract that you’re not comfortable with, you should try to negotiate the terms of the contract with the other party. If you’re unable to reach an agreement, you may want to consult with a lawyer or a contract law firm to see if the contract is legally binding.
Summary
Though it may seem tedious, reading and understanding a client contract is crucial for independent contractors. As small business owners, taking the time to carefully review a contract can safeguard you against costly mistakes and ensure that you’re getting paid for your work.
Author’s note: The content of this article is academic opinion and not the basis for legal proceedings.
