Talking about a freelance contract may seem boring but it’s necessary. According to a study conducted by PayPal and mentioned in Forbes, over 58% of freelancers have experienced not getting paid.
Maybe you thought that getting into freelancing gave you more freedom and less time filling out boring paperwork? Well, don’t worry, you do have a lot more freedom but there are still some basic things you’ll want to do to protect yourself and your business.
Unfortunately, some clients take advantage of freelancers, taking the work they provide and then screwing them over. You can mitigate this in a couple of ways:
- Providing a freelance contract that clearly spells out as much of the working agreement as possible
- Clearly laying out payment dates and what happens if payments aren’t made on time (hint: stop working!)
- This is perhaps most important of all — seek out high-quality clients, the type of people who aren’t going to screw you because they themselves have too much class
What does a freelance contract really do?
The primary purpose of a freelance contract is to organize the working arrangement in writing. What is due when? Who is doing what? Who is providing which tools? What is the product or service that will be delivered at the end of the contract?
Organizing all of this in writing is SUPER important because otherwise, in a disagreement, it comes down to a he said/she said, he said/he said, she said/she said — or in other words, a disaster.
Putting this all in one place, i.e. a freelance contract, helps to keep things super streamlined. You don’t want to leave it in an email because even though, yes, that’s in writing, it’s super messy.
(If you’ve ever been a part of a 47-email back and forth chain you know what I’m talking about!)
Additionally, let’s say you end up in a battle with a client that ends up going to small claims court. The “freelance contract” you two created only exists in all your emails. If they need to pull those emails for court purposes, guess what, they just don’t pull those. ALL of your emails get pulled. Personal, other client emails, everything in your inbox, folders, archive — someone’s pawing through it all!
So seriously, a specific freelance contract written up in one nice clean document is a must.
What are some things you should include in a freelance contract?
I’ve found that clients don’t like a huge big fancy contract with tons of legalese so if you’re just starting out (and again working with high-quality people) a simple freelance contract written in plain English is good. Here are some things that should be included:
1. Services included in the freelance contract
What are you doing? No seriously, what are you doing for the client? Be as specific as possible. Are you creating 16 social media posts per month? On what social media channel? Instagram? Facebook? Are these posts graphic imagery or written content? Creating content for a client’s Instagram page is going to be very different than if you’re ghostwriting 16 witty tweets for their Twitter account.
2. The term length of the contract
How long is the freelance contract good for? Is it ongoing or for a specific amount of time? If it’s ongoing how do you cancel or how does the client cancel? Do they have to provide a certain amount of notice in writing? All of that should be hashed out.
3. Any important due dates
These are so important. Done right, they take all of the guesswork out of things and provide both you and the client with a feeling of calm and consistency. If you keep to due dates, it goes a long way toward building trust and making the client feel safe and protected working with you.
4. Client obligations
What does the client owe in this working relationship? Are they supposed to give you weekly feedback on something? What happens if this feedback is late? Does it hold up your ability to do your work? If so, you’ll need to spell out what happens when/if their feedback is late.
Do you need them to add you to some of their company’s tools? WordPress, perhaps, or Google Analytics? Do you need to be added to their company Slack account or be given editor access to their Facebook page? Spelling all of this out in the freelance contract will give you a fallback if they ask you why something isn’t done on time. You can point to the contract and say, “Look, I listed out the things that I needed in order to do my job properly. Unfortunately, your team hasn’t given me access to XYZ and that is what is holding things up.”
How much are you getting paid for the work? When is the payment due? There are so many different payment structures: 50% up front, 50% on completion is a common one. If the project falls into phases, you might split it up into a % for completion of each phase. If you’re doing work for the client on an ongoing basis how often do they owe you? Weekly? Biweekly? Monthly? What day, the 1st? The 5th? Spell it all out.
Many clients have concerns about their confidential business information getting out. Having a strong confidentiality clause in your contract that assures them that you will treat their information confidentially, and not work with direct competitors, can help to reassure them and demonstrate your professionalism.
7. Late fees
While I’ve never experienced a client not paying me, I have experienced clients falling behind. Fortunately, I clearly spell out what happens when this happens and thus have never had an argument about it. It’s only fair to include late fees in your contract as you deserve to get paid on time. If you were a W2 employee, you’d receive your check in a timely manner every two weeks. As a freelancer, you should also receive payment in a timely manner especially if you’ve spelled out the dates clearly. If the client defaults from that, a late fee should be paid.
One more important thing you should know
When I first started freelancing a client told me something really important. He had been in a business partnership where his partner ended up being dead weight and wasn’t contributing to the business. They had a contract but the partner was being stubborn and digging his heels in about being pushed out even though he knew he wasn’t a good fit for the business.
My client told me, “A contract is only as useful as how much money you’ve got in your pockets. Because if you can’t afford to go to court/mediation to go after the other person, then at the end of the day, it’s just a piece of paper.”
Unfortunately, this is a reality for most freelancers (although if you live in New York you’ve got some legit protection thanks to the Freelance Isn’t Free Act). You CAN protect yourself, however, by putting some thought and effort into the freelance contracts you write, what you include in them, and how you manage the entire contract process with clients.
If you want more freelancing help, get my 22-page free guide. It’s called Your Freelancing Roadmap: Discover the 9 simple steps that lead to a six-figure income.
You can also reach out to me on Insta @liveworktravelig with any questions!