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Freelance Contracts: When To Use Them And How To Create One (+ Free Template)

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I’ve been freelancing for many years and so far I haven’t signed a single freelance contract agreement.

One time, I had to sign a nondisclosure agreement but that was it.

That’s the beauty of working with international clients. It’s risky, but there’s no need for signing documents, contract agreements, or dealing with lawyers.

Of course, it’s the not the case for most other freelancers, especially for those of you who work with local clients. For those freelancers, a contract agreement can be much useful. But, you don’t need contracts for each and every client you work with.

So, when should you create a contract? And how exactly do you create a freelance contract agreement? Read along to find out.

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What Is A Freelance Contract?

A contract is a legal agreement between two (or more) parties where they agree on an arrangement.  Which, if necessary, can be used in court as proof to defend yourself in case of a dispute.

A freelance contract is much similar to, but more than that. And it doesn’t necessarily mean a contract gives you the power to take your clients to court when they avoid paying you, even though there have been many cases of such.

It can be used that way too, but the main purpose of a freelance contract is to have a properly organized document where you detail the scope of the project you’re going to work on and what kind of work you’ll be doing and won’t be doing.

“Contract law is essentially a defensive scorched-earth battleground where the constant question is, “if my business partner was possessed by a brain-eating monster from beyond spacetime tomorrow, what is the worst thing they could do to me?” – Charles Stross, award-winning author.

Simply put, you create a freelance contract to have something solid to refer to when clients try to ask you work outside the scope of the project or when they try to change the project into something entirely different than what you agreed upon.

Do You Really Need A Contract?

If you, like most freelancers, use emails to discuss the projects with your clients, agree on rates, deadlines, etc, then there’s really no need for a separate contract at all.

That’s right! An email is a contract. An email discussion between you and your client where you exchange promises and agree upon certain conditions is a contract. You don’t need another document written by a lawyer to feel safe.

We live in the digital age now. If you’re working with international clients, you can use your email thread as your contract. Is the client trying to ask for work outside the scope? Simply refer them to the email reply and show what the client originally agreed to.

However, if you’re working with local clients, having a legally binding contract agreement written down on paper makes sense. For example, if you’re a web designer who works with local clients, a contract will help you make things clear to your clients that after you finish the design of the website they will pay you or you will take them to court.

But, as Seth Godin puts it in his Freelancer Course, this is only important when working with one-time clients. When working with the same client over the months or years, sending an email with your scope of the project is more than enough.

What To Include In A Freelance Contract

If you don’t feel safe sticking to emails, you might as well go ahead and create your own contract. But, contracts and taxes are two of the subjects that I often try to avoid when giving advice to freelancers because different countries have different rules and laws.

So, while I strongly advise you to go to a lawyer for creating bullet-proof contract agreements, there are a few things you must always include in your contracts. These are also known as contract clauses.

  1. Basic Information: Names, addresses, and all the basic information of all the people involved in the contract.
  2. The Scope of the Project: A clear and precise outline of the project and the work you’ll be doing. Also, mention how much you’ll be charging for work outside the scope.
  3. Revisions: Explain how many free revisions you’ll be offering and how much you charge for extra revisions.
  4. Pricing: Make your prices or hourly rates clear to your client. Explain your charges for additional work too.
  5. Deadlines and Cancellations: Describe when you plan to deliver or how you’ll be paid for your work if the client decides to cancel the project (also known as Termination Clause).
  6. Copyrights and Ownership: Depending on the type of work you’re doing, this section will describe who owns your work after you delivered and if the client will hold the copyright.
  7. Choice of Law Clause: This is the section where you and your client agrees to go to court in case of disagreements of disputes.

Keep in mind that these are only the basics of a contract outline. Some contracts require more detailed sections and clauses. An average contract can be as lengthy as 6 to 10 pages.

How To Create A Freelance Contract

If you’re not keen on taking advice from a lawyer (which I recommend), it’s important that you at least seek advice from someone who understands the laws in your country before crafting a contract.

However, if your goal is to get a simple freelance contract to cover the scope of the project and covering the law clauses aren’t that important, then you can create a basic contract by yourself.

Your contract doesn’t have to contain a ton of technical paragraphs that nobody cares to read. Just write it down the way you understand it and keep it simple and friendly. You wouldn’t want to sound too forceful and scare your client away.

“A valid contract requires voluntary offer, acceptance, and consideration.” – Robert Higgs, American economic historian and author.

You can use the template below for inspiration and see how a contract is formatted. Again, it may not be suitable for all types of freelance work, but it’s enough for you to get an idea.

DOWNLOAD FREE TEMPLATE

Note: This example freelance contract template is for educational purposes only. Please consider creating your own contract document to avoid any confusions or issues with your clients.

Summing Up

Contracts aren’t overrated. They have their uses. But, you don’t need them for each and every client you work with.

Frankly, if you’ve been dealing with too many bad clients or scope creeps, it’s time you take matters into your own hands and craft a good contract agreement as a strong backup system.

Asking your client to sign a contract doesn’t make you a jerk, it’s a great way to show integrity and professionalism. Just know how to ask it without irritating your client.

Roshan Perera

I’m Roshan Jerad Perera, a freelance writer/blogger and the founder at FreelancingHacks.com. My goal is to help other people get started in freelancing and guide them toward a successful career and financial freedom.

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