When you work with certain kinds of companies, you’ll realise that they are big on contracts. Most often, these contracts will be several pages of legalese that we don’t even have the time to read. If you object to any of the clauses, the lad in procurement will say, “it’s just a formality”. LOL, that’s what Amazon told Brian Hall and well let’s see how that goes.
Anyway, if you’re going to sign contracts, a few things you shouldn’t believe:
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“Just a formality”: If it doesn’t mean anything, why do it? Because it does mean something, it protects their ass.
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“Who is going to sue?”: You won’t believe how much they can intimidate without ever going to court.
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“This is standard practice”: If it’s unfair, you don’t have to care.
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“We can’t change the template”: Yes, they can.
Now, a few things to look for in contracts, even if you’re averse to reading word-by-word (though, I recommend you just put text-to-speech and listen lying down):
Payment terms: Anything more than 30 days, push back. Also ask for penalty for late payments. You might not get it, but doesn’t hurt to ask.
Scope of work: It’s best to write this part yourself to make sure there is no scope creep. Mention inclusions and exclusions clearly.
Non-compete: If the contract has anything about you not being allowed to work with anyone, read it very carefully — whether it’s while you’re working with them or after. As a freelancer / agency, you *will* work with multiple companies, often of the same industry / category. A non-compete can restrict you to that one client. You don’t want that. In fact, I just asked a client to remove ‘competitors’ out of their non-compete clause — which had employees, vendors, etc. — and they accepted.
Transfer of ownership / intellectual property rights: All rights will go to the client, of course. Once they pay for it. Most contracts won’t mention “on payment” by default. I’n my experience, those reluctant to add this are the ones who will end up not paying in the end. If their payment record is suspicious, discuss this with them.
NDA: Check if their NDA means that you can’t add the work you do for them to your portfolio.
Most importantly, make the contract equal.
If there is a clause requiring you to respond in 3 days, ask that the same apply to them. They need all communication from you in writing, ask them to do the same. If they expect you to rectify your errors without charging them extra, ask them to add that they will pay extra to compensate for their errors. If they ask for single-point-of-contact at your firm, ask for theirs.
Just don’t sign anything you don’t agree to. Ask for someone to explain clauses you don’t understand. Get a lawyer to look through it, if you find something fishy.
Didn’t you start your own business because you were tired of living by someone else’s rules? 🙂