Depending on your industry and client, your contract might include deliverables, late fees, who owns the rights to the work, when and why the contract can be terminated, and other expectations.
A contract is the final stage of signing a new client or starting a new project. It should include as much information about the project as possible and is more detailed than a freelancer proposal, which outlines potential details about the work to be completed.
What is the difference between a freelance proposal and a contract?
A proposal outlines many of the same details as a contract — such as due dates, work to be completed, and contact details. However, a freelance proposal is not a legally binding contract. In many cases, the proposal serves as a precursor to a final signed contract.
What is the purpose of a freelancer contract?
The purpose of a freelancer contract is to outline expectations, terms and conditions, and payment details. Outlining these terms in a contract provides both clients and freelancers with a clear understanding of the client-freelancer relationship and the legal repercussions of violating the contract.
It also serves as a legal agreement to protect both the freelancer and the client from liability, scams, and misunderstandings.
Why is a contract important for freelancers?
A contract is an important part of many agreements. For example, you might sign a rental contract before moving into a new apartment or a catering contract for a wedding reception.
Many freelancers overlook the importance of having a solid contract in place. You might be excited about the possibility of a new client and want to dive into the new job right away.
For freelancers, however, contracts are crucial because employee agreements and laws do not protect you.
A strong freelancer contract is essential because it helps clearly define the client-freelancer relationship and protects your rights. Here are a few more reasons why having a contract is crucial for all freelancers:
- A contract outlines and ensures payment terms are met.
- It helps protect you from clients that try to avoid paying by providing legal recourse.
- It helps protect your client by outlining the requirements you must meet.
- Contracts ensure both the client and the freelancer are on the same page about the work to be delivered, due dates (for work and payments), and outlines the consequences of breaching the contract.
Contracts also show prospective clients you are a professional freelancer who can be trusted to complete tasks and perform the agreed-upon work.
Benefits of a great contract
Not all freelancer contracts are created equal. A sloppy contract that fails to outline important details can be worse than no contract at all!
However, a great contract should be easy to replicate from client to client, simple to customize, and should outline terms in simple, easy to understand terms.
Your contract should also be vetted and reviewed by a legal team to ensure it meets the requirements for your location and your industry.
If that all sounds like a ton of work, then you are beginning to understand why so many freelancers rely on fully-vetted, customizable contract templates from Clarrow. A great contract lets you focus more time on work and less time dealing with paperwork — while still protecting your interests.
What are the different types of contracts?
Contracts are used any time two (or more!) parties want to formalize an agreement. For example, a business partnership contract might outline each person's roles, how much each party will invest in the business, and what happens if or when the business is dissolved.
On the other hand, a freelancer contract generally outlines the agreement between a non-employee freelancer and their client. However, there can be multiple types of freelancer contracts, depending upon the industry you are in and the types of clients you work with.
Here are a few of the most common types of freelancer contracts.
Independent contractor contract
An independent contractor contract is a document that outlines the working agreement between a non-employee contractor and client. It generally establishes the relationship as a non-employee arraignment, which means the client cannot determine when you work or the exact way in which the work is completed, though this may vary by state. It also includes the type of work to be completed, when deliverables are due, payment terms, and length of the contract.
Consulting service contract
A consulting services contract is a document that outlines the agreement and expectations between a consultant and a client. Since consultants tend to offer analysis and advice, rather than specific deliverables, these contracts might include information such as what data or platform the consultant needs access to and how the consultant will deliver recommendations.
Monthly services contract
A monthly services contract is an agreement between a freelancer or business and their client for an ongoing, automatically renewing the agreement. For example, a social media expert may provide a monthly services contract to manage clients' social media presence. These types of contracts may require notice before the agreement can be terminated.
A retainer contract is an agreement between a freelancer and a client for a set amount of work per month. This allows the freelancer to set aside a specific amount of time for each client, and they receive payment whether or not the client needs the work.
Retainers ideal for clients who require a quick turnaround, as they can essentially "reserve" time each month. While you've most likely heard of retainers in relation to lawyers, they are also popular with freelancers in fields like website development, social media management, and content or copywriting.
Elements of a great contract template
Contracts are a critical part of building a successful freelance business. However, as you can see, they are complex legal documents. Which is why using a contract template is ideal for freelancers — you can edit your contractor template to add new details then sign and send in a matter of minutes!
So, what should your freelance contract template include? Here are the main elements that make for a great contract template:
- The names and contact details of the freelancer and client
- Project scope and deliverables
- Legal outline of the freelancer's role (including what is not included)
- Specific dates for the work
- Pricing and rates
- Payment terms, including due date and the types of payment accepted
- Late payment penalties
- Ownership / Copyright of the work
- Kill fee and cancellation terms
- Signatures of both parties
Your contract should also include anything else that affects the freelancer-client relationship such as how many rounds of edits you offer, how long clients have to approve projects, and when the contract expires.
Common clauses in freelancer contract templates
In addition to each specific project's details, you'll also want to include legal clauses in your contract template. By including these in the template, you won't have to rework your entire contract each time you sign a new client — simply add the new details, sign, and send!
These can be confusing if you don't have a legal degree. However, Clarrow provides a selection of several fully-vetted clauses, including:
- Intellectual property rights: Who owns the work and when does ownership transfer?
- Confidentiality: Often called non-disclosure, this clause outlines what information is private to the company and may not be shared.
- Termination: In what situation can the contract be canceled?
- Limitation of liability: This outlines situations in which you (or the client) be held responsible for damages as a result of your agreement. (Also called indemnification clauses.)
- Force majeure: A clause that frees both sides of the contract from liability in the event of an extreme circumstance beyond their control occurs. For example, if a riot or war stops you from meeting your end of the contract, you would not be held liable.
Clarrow makes it easy to include all applicable clauses by simply clicking the clauses you want to include in each contract.
Create your freelancer contract with Clarrow
A strong contract is key to a successful client-freelancer relationship. Creating an excellent freelancer contract can be time-consuming, which is why a contractor template is so helpful!
Use Clarrow's freelancer contract template to create customized contracts in minutes — so you can get back to the work you love.