Are you looking to protect yourself and your business?
If so, you need a consulting contract (or agreement).
In this post, I’ll explain:
Let’s start with the basics.
A contract is essentially any legal document drawn up by at least two parties with a shared interest.
A consulting contract confirms a working relationship between you (the consultant) and your client.
Sometimes, consulting contracts are also called “consulting agreements.”
Don’t worry too much about the language here, though – they’re basically the same thing.
But what do these contracts actually look like?
There are plenty of different types of consulting contracts, depending on the industry you’re in and services provided.
This includes common industries such as:
While there are some differences between different consulting contracts, there is also a lot of common ground between them, including a number of essential points all consulting contracts should cover.
We’ll get into all of that a little further below.
But first, do you even NEED a contract?
This is an easy one – the answer is YES!
If you’re serious about the work you do, a contract is non-negotiable.
That’s because a contract offers legal and financial protection for both you and your clients.
It’s also the best way to outline (and enforce) clear boundaries regarding your services.
You see, with a contract, you outline exactly what your services will look like – so that you’re on the same page with your client.
And if you’ve ever had a difficult client before…
You know how important boundaries can be.
So, let’s talk about how to write one.
As I mentioned earlier, contracts can be really varied…
But the most important thing to keep in mind is this:
The contract needs to work for your business.
For instance, how often do you meet with your client?
What do payment terms look like?
In this post, I’ll keep it pretty general with the essential points your contract should cover:
Let’s start with the basic information.
Your contract needs to contain some very basic info about you and your client:
This information should appear near the top of the contract.
Next are the service details.
Try to be specific. The more detail you include, the better.
Describe the deliverables you and your client agreed upon, and the project’s scope. For additional clarity, some contracts even include the services you’re not going to provide.
Here are some questions you’ll need to think through:
Remember: If this section is really clear, it’ll help you avoid misunderstandings later on.
Also, projects can change over time. So, if you or your client decide to make adjustments to the project’s scope at any point, you can always rework the contract.
Just don’t forget to have both parties re-sign it as well!
Now, let’s talk about practical points like dates and fees.
First, you need to determine the project’s duration. I recommend establishing concrete start and end dates.
Concrete dates help everyone stay on track. And you can always extend the project’s duration if needed.
Next, you need to clearly state your fees.
If you’re not sure what to charge for your services, I’ll walk you through the decision in this video:
You’ll get the following:
Other ways to get the help you need include popular legal websites like LegalZoom and RocketLawyer.
And last but not least, I’m sharing a template with you right here:
This Consulting Agreement (the “Agreement”) is made as of [Effective Date], by and between [Consultant’s Name], with an address at [Consultant’s Address] (the “Consultant”) and [Client’s Name], with an address at [Client’s Address] (the “Client”). The Consultant and the Client are collectively referred to as the “Parties.”
1. Services
The Consultant agrees to provide the following services to the Client (the “Services”):
2. Compensation
The Client agrees to pay the Consultant at the rate of $[Rate] per hour. The Consultant will invoice the Client on a [monthly/weekly] basis, and all payments are due within [Number] days of receipt of the invoice.
3. Term and Termination
This Agreement shall commence on [Start Date] and continue until [End Date], unless terminated earlier. Either Party may terminate this Agreement with [Number] days’ written notice. Immediate termination can occur if either Party breaches any material term of this Agreement.
4. Expenses
The Client agrees to reimburse the Consultant for all reasonable and necessary expenses incurred in connection with the Services, provided that such expenses are pre-approved by the Client.
5. Confidentiality
The Consultant agrees not to disclose any confidential information of the Client, including business operations, customer information, and financial data. This obligation will continue for [Number] years after the termination of this Agreement.
6. Intellectual Property
All intellectual property developed during the term of this Agreement shall be the exclusive property of the Client. The Consultant agrees to assign all rights, title, and interest in such intellectual property to the Client.
7. Indemnification
The Client agrees to indemnify and hold harmless the Consultant from any claims, damages, or liabilities arising out of the Consultant’s performance of the Services, except where such claims, damages, or liabilities result from the Consultant’s gross negligence or willful misconduct.
8. Independent Contractor Status
The Consultant is an independent contractor and not an employee of the Client. The Consultant has no authority to bind the Client in any manner.
9. Governing Law
This Agreement shall be governed by and construed in accordance with the laws of the State of [State], without regard to its conflict of law principles.
10. Miscellaneous
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the day and year first above written.
This template provides a general framework and should be customized to fit specific needs and legal requirements.
But again, I’m no lawyer — and it’s best to get all of your legal documents checked by a professional lawyer. So, if you use this template, note that it doesn’t constitute legal advice and you need to consult a lawyer before using any contract created with this template.
Finally, you can use an e-signature service like Dropbox Sign to send your contract to clients.
