The set up of contracts is vital to ensure that your freelancing business functions smoothly and is secure so you and your clients can feel safe and secure when working together. Contracts serve as a safety net to ensure both parties are protected.
Due to their fear of forgetting important details, freelancers usually hesitate to draft freelancing contracts.
The freelancer agreement: how does it work?
Freelancer hiring agreement are legal contracts between freelancers and clients which describe in detail the work and the project that is to be completed.
A freelancer and a client will both be protected by this contract. In addition, the freelancer will receive a guarantee that they will be paid for the work they will be delivering, as well as a guarantee that the company will receive the work and deliverables they can expect. Since it is a legal document, it can be used in court if something goes wrong.
The following clauses should be included in a freelancer’s contract:
In case you’re still not sure how to write a freelancer contract, here’s a list of some contract clauses you should include in your agreement if you aren’t sure how.
1) Price and work rates
Is your freelancer contract clear about how you’ll be paid. Will you charge a specific amount for the entire project or do you charge by the number of hours you worked?
Depending on the type of work you do, you might find it more attractive to get paid based on the number of hours you work. However, it can sometimes be hard to predict how long a project will take when a freelancer is working independently.
A point to keep in mind is that, if you charge by the hour, you should include a clause that states that the project will not exceed X hours and will not fall below Y hours, thus providing you with a safety net if the project exceeds those hours.
2) Payment schedule and methods
The best time to get all the money is at the beginning, but it’s not a good idea to do so all at once if you’re just starting out. As a freelancer, some freelancers prefer to be paid in three installments, either in a 40/40/20 or 30/30/40 ratio. The project may be divided up into two parts in some cases: 25/75 or half up front and half after it has been completed.
- The best way to avoid non-paying clients is to avoid them as quickly as possible
- This will result in fast cash flow, especially if you are working on a long-term project and you expect it to last for years to come
- The number of clients who have already invested has increased, so there has been more feedback
- An expense you may incur for your project, such as the cost of a tool
When it comes to accepting upfront payments from clients, it is entirely up to you.
Make the schedule of payments as clear and clear as possible in the contract so both parties know what to expect.
3) Deadline and timeline
The deadline and start date of freelancer contracts are generally defined.
A time schedule allows you to plan your project based on your own schedule, and a motivational tool can help you get going.
You should include a deadline clause when negotiating the contract to benefit both parties. Find a middle ground that will satisfy both parties.
4) Kill Fee or Cancellation Fee
Whenever a kill fee (also known as a cancellation fee) is in your contract, you can always get your money back.
There are several reasons why a client may terminate a project, so you will be charged a kill fee in the event that the client terminates the project for any reason (bankruptcy, cancellation, etc.) and you need to make up the time you have already invested.
A termination fee, plus additional costs incurred for already completed work, could be charged with the already paid deposit.
As you may be aware, copyright plays an important role in determining who owns a work and preserving it as well.
The copyright should be retained until the project is completed and paid, so it is a good idea to include that clause. Ideally, the contract should be constructed in such a way that both parties benefit. After the work is done, the client gets the rights and you must not use or sell it to anyone else.