Design Consultant Contract: Everything You Need To Know
A design consultant contract is a legal services agreement used to spell out the terms and conditions of a design consulting project.3 min read
A design consultant contract is a legal services agreement used to spell out the terms and conditions of a design consulting project. The consultant contract is also called a consulting agreement, business consultant agreement, freelance agreement, or independent contractor agreement. The design consultant contract should include responsibilities, obligations, payment information, IP rights, and other pertinent information.
What Is a Consultant?
A consultant is an individual or business providing advice and/or professional services in exchange for compensation. Consultants are sometimes called freelancers or contractors and often specialize in a particular area, such as engineering, marketing, or design.
When Is a Consultant Contract Used?
Consultants should create a contract before providing any payable services to a client. Doing so protects your financial interests and ensures payment for your services. It also allows recourse if a dispute arises.
Businesses hiring a consultant should also request an agreement dictating the terms of the engagement. This can include a non-disclosure agreement to protect confidential company information.
What Are the Elements of a Consultant Contract?
Every consultant agreement should include the following sections:
- Basic contact information for both the service provider and the client.
- Comprehensive details of the services that will be provided under the contract.
- The duration of the contract and procedures for termination with notice.
- Details about compensation, including the amount, how and when payments will be made, penalties and interest for late payments, and whether expenses are reimbursed.
- Confidentiality and non-disclosure information.
- Non-competition and non-solicitation terms.
- Ownership of intellectual property created under the contract, such as copyrightable artwork.
What Should Be Included in a Design Contract?
Design consulting contracts should include several specific elements in addition to those described above. These include:
- A change request, which establishes your hourly rate for requested work outside the scope of the original contract.
- The specifics of the revision and acceptance process.
- A design tools clause, which protects your ownership of code used for multiple projects even when the copyright for the deliverables reverts to the client.
- A kill fee clause that establishes a cancellation penalty, either a fixed fee or a percentage of the total contract.
- Licensing models, including:
- Full assignment, in which ownership rights are assigned to the client for work produced.
- Exclusive license that allows the client to make some modifications to the deliverable.
- Exclusive license where the client can only use the work for a specific project and cannot modify it.
- Limited license, like the exclusive license but indicates that the same deliverables can be provided to other clients.
This sample agreement is provided by KMI International.
1. A description of the Work to be performed by Consultant and any deliverables to be provided under the Agreement should be described in a Project Description and Scope of Services that should be attached to the Agreement in an Exhibit.
2. The Work to be performed by Consultant shall not commence until Owner issues a Notice to Proceed.
3. In addition, Owner may, from time to time and at its discretion, add to or deduct from the Work by issuing a directive to Consultant describing the nature and scope of the change in the Work (the “Scope Change”). Unless the directive indicates that it is for a quote only, Consultant will immediately proceed with the performance of the Scope Change. Within the time allotted in the directive, Consultant will respond in writing with what it believes to be an appropriate dollar amount to add to or subtract from the Compensation by reason of the Scope Change. A reasonable fee for these Scope Changes or a reasonable credit for any reduced scope will be established for the change. Consultant shall use the agreed-upon fee schedule as outlined in Exhibit “C” of this Agreement for all Scope Changes. If the parties agree upon the amount of the addition or deduction, a written change order (“Change Order”) to the Agreement will be signed. If the parties cannot agree, the parties will endeavor to resolve their disagreement with regard to the amount due for the change in the Work. The amount agreed to by the parties for the Scope Change will be paid within Owner's normal invoice process as provided for in the Compensation section of this Agreement. Any Scope Change undertaken by Consultant will remain within the scope of this Agreement and will be governed by the terms and conditions of this Agreement, as amended by the Change Order.
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