Agreements between a consultant and client involve several issues to discuss. In addition to determining what services the consultant will provide, you will need to decide how much to pay the consultant and what will happen if the terms of the contract aren't fulfilled.

What Should You Put in Consulting Agreement?

When hiring a consultant, you should use a type of contract known as a consulting agreement. Both businesses and individuals working with a consultant should have such an agreement in place.

While drafting your consulting agreement, there are a few important issues that you need to cover:

  • Scope of Work: Defines the services that the consultant will offer. This section should also outline the time the consultant will have to provide services. You should also state whether the consultant's expenses will be covered.
  • Term: Describes how long the consulting agreement will last and under what circumstances the agreement can be terminated.
  • Clause for Breach of Contract: Lists the penalties if the consultant does not fulfill their contractual responsibilities.

Taking your time to draft an air-tight consulting agreement will make sure that both you and your consultant will be protected.

Writing a Consulting Agreement

As long as you follow the correct format, writing a consulting agreement shouldn't be that difficult. First, you need to state what type of consulting service the agreement is for and should list both the name of the client and the consultant. After listing the name of each party, you should include a statement that both the client and the consultant have agreed that one party will provide consulting services to another in exchange for a fee.

The Scope of Services section is the most important part of the agreement. In this section, you will describe what services you want the consultant to provide. You should include as many details as possible in this section. Failing to fully describe the scope of service may make it difficult for your consultant to do their job and can weaken your contract. For example, if there is a service that you need, but you didn't describe it in the contract, you would have no way of forcing the consultant to provide the service.

The Delivery of Services will describe how the consultant will provide the required services. In most cases, you should list that only the consultant may provide the listed services. If the consultant wants another person to provide a particular service, you, the client, would first need to give your approval.

In the Terms of Agreement section, you should outline the intended length of the consulting agreement. List both the date the services will begin and the date they will end. You could also include a statement that the contract will end if one or both parties decide to terminate the agreement.

Every consulting agreement needs a section that outlines the fees that the client will pay the consultant for their services. You can request that the consultant provide regular invoices for his or her services and expenses, define the amount he or she will be paid, and how frequently payments will occur, typically:

  • Daily
  • Weekly
  • Monthly

You should also include a section in your contract describing how taxes will be paid. The client must pay for any sales tax that applies to the consultant's service unless you specifically state that the consultant should collect and pay these taxes.

Both parties should also discuss expenses when writing a consulting agreement. In most cases, the consultant will need to pay for any expenses that arise during the course of the agreement. If the client agrees to cover the consultant's expenses, the contract should state that the client must approve all expenses before making payment.

You should also include a statement that the consultant should maintain a level of professionalism when offering their services, and that he or she should perform these services to the best of his or her ability. The contract should also state that any person that works for the consultant will be held to this same standard.

Your consulting agreement should also include a section that discusses conflicts of interest. The consultant should have the freedom to offer their services to other customers so long as it doesn't interfere with the services they agreed to provide you.

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