It's vital to draft a contract. It is crucial for a freelancing business to work with contracts so that it is dependable, functional, and secure. Contracts will serve as a safety net for both you and your client. However, what should this contract contain, and is one required to be signed? In this article, we shall see the 5 must-have clauses for any freelancer contract.
Most freelancers are hesitant to draft their own freelance work contracts because they don’t understand legal language or are afraid of forgetting the ‘fine print’. When drafting a contract for the first time, it is generally a good idea to consult a lawyer, but one can also learn by themselves. To help you get started, we’ve prepared a contract template that you can use as a guide at the end of the article. Keep reading to see all the information in the document. This blog is about Clauses of freelance contract.
How to Make a Freelance Contract: 5 Clauses to Include: What Is a Freelancer Contract?
A freelancer contract outlines the project to be completed and the work to be delivered by the freelancer and the client. Such a contract would protect both parties. Freelancers receive a guarantee of the money they will receive for the work they deliver. In contrast, companies receive confirmation of the work they can expect and the deliverables. Since it is a legal document, it might be used as evidence in court if something goes awry. In order to avoid future misunderstandings, freelance work contracts should include as much information about the project as possible.
What Should a Freelance Contract Include?
- Contact details of the freelancer and the client
- Scope of the project in brief
- Deliverables of the project in detail
- Pricing and rates of the project
- Payment schedule and other options
- Deadlines and timeline of the project
- Ownership and copyright of the project
- Legal representations
- Kill fee and cancellation terms
- Signatures of both parties
- In addition to anything else that might affect freelancers and clients.
Should I Always Sign a Freelancer Contract?
We strongly advise all freelancers to sign a contract. The freelancer contract is the first template on our list of the most important templates for freelancers. In the current digital age, you’re likely to communicate project details via e-mail, so that’s also a written contract. However, we believe that summarising all details in a contract and having it signed by both parties is a far better option.
- Price and work rates :
- Payment schedule and methods:
- Deadline and timeline:
- Kill Fee or Cancellation fee:
- Copyrights
1. Price and work rate:
Ideally, a freelancer contract should leave no doubt as to how your payment is determined. Are you going to charge a flat fee for the entire project or for the hours you put in? Depending on what type of work you do as a freelancer, it may be preferable to be paid by the project rather than by the hour. However, it is not always easy to predict how long the work will take. In those cases, getting paid by the hour may be more appealing. Eventually, you must focus on ensuring that you are paid. A minimum and maximum working hours clause are also recommended if you charge by the hour. It specifies that the project will take no longer than X days and no less than Y days, acting as a safety net for both you and the client. You can add an extra line for project-based payments mentioning your hourly rate for extra work. For example, ‘Any additional work will be charged at a flat rate of XY $/₹ per hour.’
2.Payment schedule and methods:
Meanwhile, you should set up a payment schedule. Acquiring all of the money at once may not be the best idea, especially if you are just getting underway. Some freelancers prefer to be paid in three installments of 40/40/20 or 30/30/40. Others agree on two instalments: 25/75 or 50% upfront and the remainder – 50% – upon project completion.
Requesting an upfront payment or a deposit from your client can be beneficial to your freelance business. Why?
- A simple and quick way to avoid clients who refuse to pay you.
- It’s great for your cash flow, especially if you’re working on a long-term project.
- More client feedback, as they are already paying (investment).
- You will be given money to cover project expenses, such as the purchase of a tool.
Of course, not every client will be pleased with upfront payment, which is entirely up to you. Just make it as clear as possible in the contract so that both parties know and are comfortable working with that payment schedule. A freelance contract should also specify the exact method of payment. As a freelancer, what is your preferred method of payment? List all of the payment options you provide: Direct debit, PayPal, checks, bank transfers, credit cards, and other payment methods are available. We recommend that you check wise if you work with clients from other countries. You’ll receive instant international bank details, allowing you to receive money from over 30 countries around the world with no fees – ideal for freelancers.
Here’s an illustration of a payment schedule clause:
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25% upfront before the commencement of the project and the rest after the completion of the project. Payable by Paypal, Google pay and bank transfer. |
Once the payment options are decided, how much time does the client have to pay you must be decided. Are you ok with receiving the payment 14 days after sending the invoice, or would you prefer just seven days later
3. Deadline and timeline of the project :
In general, every freelancer contract includes a deadline as well as a start date. On the one hand, it allows you to plan out the project according to your own timetable, and on the other hand, it can even help with motivation. Of course, the inclusion of deadline Clauses in freelance contract benefits the client as well. Negotiate the deadline clause with the client to find a happy medium for both of you.
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[Insert Deliverable 1 – specifications and due date] [Insert Deliverable 2 – specifications and due date] [Insert Deliverable 3 – specifications and due date] [Insert Deliverable 4 – specifications and due date] |
A deadline clause should be included in a freelancing contract.
You could also include a few lines stating that any time you are waiting for your client’s feedback is not included in the project’s timeline. As an example: ‘The days spent waiting for you to provide feedback or any requested resources (images, contact information, logos, etc.) are not considered ‘business days’ and are not included in the timeline.’
4. Kill Fee or Cancellation Fee
If you have bad luck with your clients, a kill fee (also known as a cancellation fee) is the contract clause that will keep you from losing all of your money.
A kill fee is exactly what it sounds like: if the project is terminated for any reason (client goes bankrupt, cancels the project, etc.), the client is bound to compensate you financially for the time already invested in the project.
You could stipulate that the previously paid deposit is non-refundable and will be used as the kill fee in the event of termination and any additional expenses for work already completed.
Here’s an example of a kill fee clause:
‘At any time, either party ‘the freelancer’ and ‘the client’ may terminate this contract. Upon completion of any work provided by the freelancer:
The initial down payment of 30% is non-refundable. |
5. Copyrights:
Last but not least, don’t overlook the significance of copyright and ownership rights – they determine who owns the work.
However, there are some differences between most freelancing professions and this copyright clause. Designers, for example, may wish to retain ownership of sketches that were not used in the project. Freelance writers could include a clause in their contracts that allows them to reuse their content after a certain period of time has passed.
A copyright Clauses of freelance contract designer contract might say something like:
| ‘Once the work is completed, and payment is received, the client will own the design rights.’ |
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