What kind of contract do freelancers need?
Whether you’re experienced in your trade or straight out of university, becoming a contractor or freelancer could be the most financially rewarding decision you make.
Being great at what you do is just half of the challenge and the rest is down to onboarding clients and keeping up a strong working relationship with them afterwards.
To achieve success, you need to put in a lot of working hours and so, it can be difficult to keep up to date with all the logistical aspects of freelancing, especially the contracts. Therefore, freelancers like yourself often need all the help available when it comes to legalities - as not knowing the details of your contracts can be a costly lesson for any freelancer that has to learn the wrong way.
To help you along, Mackenzie and Dorman have put together this guide which lays out the 5 most common freelancer contracts in the UK and how you can make the most out of each. This guide is for freelancers not ready to utilise a legal firm just yet but still needing that professional advice to ensure the much sought after financial freedom.
What’s a quick freelance contract I can utilise for a client I trust?
A letter of agreement is the most informal variation of a freelancing contract and the best legal advice suggests to only sign and work from a letter of an agreement if you have a guarantee that the client is reliable, perhaps you’ve worked with them before or you know them personally.
An informal contract can be desirable because of its simplicity, it can be created quickly by either freelancer or client and it states what both parties require from each other. A negative aspect is that an informal contract has less legal standing and therefore it can inappropriate for some serious working relationships. Yet, an informal contract is still a contract, as the definition of a contract is simply: An agreement between two or more persons which creates an obligation to do or not do a particular thing.
If you want to keep your letter of agreement as legally tight as possible, even if you’ve created it on Microsoft Word yourself with a template from Google, you should make sure it: includes all relevant provisions, that both you and the client understand the letter fully and that it includes the provision for its termination and out lay the conditions that would make this acceptable
Will I ever need to sign a contract to ensure my discretion?
A non-disclosure agreement, also known as an NDA, is a type of contract that a client will provide you and you may be asked to sign it before any scope of work has been signed off, or any terms agreed to. An NDA is a contract to protect your client's interests and by your agreement to this contract, you agree to not disclose any information around the work you will complete.
What sort of contract do I need if I am working with an agency?
Whenever sensitive details are shared between a freelancer and a client, there is potential for exploitation by a freelancer to gain an edge with the competition. This is common when a freelancer works with an agency and that is why a non-compete agreement may need to be signed.
A non-compete agreement is usually required in situations where your client has their own clients, so for example – if you’re undertaking freelance copywriting work for a marketing agency, then you might need to sign one. This is to stop you pitching work to their clients and competing with your client in any form.
When does a freelance contract layout all of the information that I am going to undertake?
Sometimes an entire freelancing contract may be called A Statement of Work and it will include every aspect of all tasks that you as a freelancer will work on for the client. Other times A Statement of Work may be provided to you as a second document that’s arguably just as important as your contract.
Often this document will double up as a project plan too but please remember, if this type of document only includes a statement of work and no other details than it may not be as legally tight as a formal contract would be.
What is the most legally tight type of freelancing contract?
Often it will be referred to as a formal contract, and it is a document that has been provided by a client and the client has the right to read it over and put forward changes.
A formal contract is generally built upon a template that has been checked by a lawyer and therefore it is the most legally airtight.
A formal freelancing contract should include every detail and expectation that both parties hold including but not limited to: pay rates, holiday days, work and delivery expectations and a service level agreement.
You’ve come to the end of the article. We hope now you’ve had most of your contract questions answered and you’re ready to get financial freedom through freelancing. Remember, that whatever contract a client gives you – you should know what you are signing and keep a lookout for one-sided clauses.
If you’re ever concerned about freelancing contracts, consider reaching out to a solicitor that specialises in working contracts and that way, you know you’ll be safe.
Editor's Note: Read More on freelancer legalities and dealing with late payments.