Work Agreement Contract: Everything You Need to Know
A work agreement contract can be used when you need someone to help you with a project, but you don't want to hire a full-time employee.3 min read
2. Describing the Project
3. Negotiating Price
4. Duties of Contracted Parties
5. Project Deadlines
6. Ending the Contract
Updated September 30, 2020:
A work agreement contract is another name for an independent contractor agreement. You would use one of these contracts when you need someone to help you with a project, but you don't want to hire a full-time employee.
Defining Your Contracting Role
Formalizing a business relationship requires using a contract. Independent contractors in particular should insist on a work agreement contract, as it can provide legal protections and will describe the work the contractor needs to perform and for what price. When writing a work agreement contract, you should be sure to provide protections for both parties and fully explain everyone's duties.
One of the most important things to define in your work agreement contract is your role. Clearly stating your role as an independent contractor can be helpful when it comes time to file your taxes, and it can also be beneficial for the client, as it will be clear that you are a contractor and not an employee.
All you need to do is include a statement that you are working as a contractor and are not being hired as an employee. It can also be a good idea to state that you are responsible for deciding how to fulfill your contract and that you will provide any tools you may need to complete the project.
Describing the Project
Next, you need to fully describe the project that the contract will cover. Providing a complete description of the project will make sure that all parties understand what work is required.
You should talk with your client about what tasks they want performed, and you should also make sure your contract includes provisions to prevent the client from requesting more work outside of what's written in the contract.
Every work agreement contract needs to include how much the client will pay for the project and when the payment occurs. Before you discuss payment with your client, you should consider a few different factors:
- What you would like to earn from your project.
- The amount that you believe your client will reasonably pay.
- The least that you will accept for your work.
During contract negotiations, agreeing to a price can be an obstacle, which is why it's important that you prepare before meeting with your client. After agreeing to your price, you should ask your client how he prefers billing to occur. Some clients may want to pay at the end of a project, while others may want to pay in installments after certain milestones have been reached.
Duties of Contracted Parties
A common mistake when writing a work agreement contract is assuming that all parties understand their role. To avoid any problems during the course of the project, you should make sure the contract defines everyone's responsibilities. For example, if you're going to need to interact with several departments within a business in order to complete the project, you need to contact the lead person in each department and tell them how and when they should review your work.
You should set up a way to let everyone in the business know the progress you are making. It's also important to ask your client if she wants the contract to include an insurance coverage provision.
Another important item to include in your contract is how long you expect your relationship with your client to last. If you're not certain how long you will need to finish your work, you can provide a general timeframe. You should set firm deadlines for completing certain portions of the project, and you should also ask your client what he expects to have delivered at these deadlines.
It's also important to discuss what your client considers a successfully completed milestone. Setting these milestones will help you move forward with your project, and it should keep your client satisfied since she will be seeing work completed on a regular basis.
Ending the Contract
One of the final steps of writing your work agreement contract should be discussing how both parties can cancel the contract if necessary.
This section is crucial because it protects both you and your client from unforeseeable events. Several reasons exist for canceling a work agreement contract. For example, if your client fails to pay you in a timely manner, you may want to cancel the contract, and your client may wish to terminate the agreement if you fail to meet contract milestones.
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