You may have heard that a contract isn’t necessary for freelancers or small businesses. You may have even been told that a creative brief is enough to protect you and your work.
But considering freelancers and small businesses usually don’t have legal departments, they are the ones that could benefit from using a contract the most—a lesson you shouldn’t have to learn the hard way.
Read below to find out how Jenny Dang protected herself with a contract, and how you can, too!
The Benefits of a Contract
If you intend to sell any goods or services and you want to get paid for them, a contract is necessary.
If you’re a freelancer (especially in a creative industry such as design, writing, or content creation), a contract helps protect your intellectual property. Intellectual property includes trademark, copyright, and patents, under which, among other things, creative works such as novels and designs, inventions, as well as logos, names, and other marks that identify a brand are protected.
Freelancers will most often be concerned with copyright, which protects their creative works (like, for example, designs they might create for a client).
A contract can answer questions about rights; that is, who owns the copyright. Is your project a work for hire contract (where you submit your work and transfer all copyrights to your client)? What about if they want to resell the work you did for them? Do you have rights over subsequent runs or prints of your work? Will you have the right to put this work in your portfolio?
(By the way, if you want a bit more of a primer on intellectual property, check out the blog post How to Protect Your Business with Trademark and Copyright.)
A contract also does the following:
- shows you’re serious about protecting your work and that you know your work’s value
- makes you look like a professional
- helps set and manage expectations between you and your potential client
- provides a basis for legal action should it be required, and
- helps weed out potential nightmare clients.
This last point is the most important. If a contract can help you avoid a shady or troublesome client altogether, why wouldn’t you want one?
Contract to the Rescue! How Jenny Dodged a Bullet
Jenny Dang, a freelance designer, reached out with this story:
Breaking It Down
Jenny’s experience demonstrates that even a client we think we will have a good, easy working relationship with - even someone we consider to be a friend - might turn out to be much more difficult to deal with than expected.
Having a solid contract in place helped her navigate this tricky relationship, in addition to
- helping set boundaries
- preventing a nightmare situation (including possible legal battles) down the road, and
- maintaining her professional reputation.
A contract can act as both a preventative measure (as seen in Jenny’s story) and a remedy.
Good Contract Basics
The best way to ensure you have a solid contract is to use one that has been drafted by a legal professional.
Warning: there are a number of free freelance contract templates online. But beware, most of these have not been drafted by lawyers and will not provide you or your business with comprehensive protection. Further, they may have been drafted in other countries and might not apply or be enforceable in the US.
Artful Contracts offers a variety of contracts, including a Freelancer Contract Template, that has been drafted by an attorney licensed to practice in the US.
However, it’s still good to know the basics of what should be included in a contract:
- Project essentials: who’s involved (your name, business name, the other party’s name and business name), what kind of work you will be completing, your main point of contact and their contact information, and even how revisions will be conducted;
- Project duration & response times: the start and end date of the project; how long each party has to respond to a request or task (this is particularly important for a client who tends to be non-responsive!);
- Project delivery: how the client will receive the project (will they receive it via email? Google Docs? Will you need to prepare a presentation to go over the completed project?);
- Project financials: agreed upon rates and any other financial details you wish to include, such as a penalty for late payments; and
- Give yourself an out: include a clause that details what happens if either party cancels the project. This can protect you from losing income if something comes up.
The Contract Lifesaver
A solid contract that identifies the project’s basics, parties, scope, financials, and unique concerns can protect you and your work so that you can focus on growing your business and building your brand.
If a client is immediately put off by having to sign a contract, that can serve as a red flag.
Simply suggesting a contract be signed and having one ready for a potential client can ward off not-so-honest clients, as we learned from Jenny’s experience above.
If you’re a freelancer or work in the gig economy in any capacity, it’s best to be prepared.
To best protect yourself, follow these steps:
- Commit to using a contract in all of your client projects.
- Use a contract that has been prepared by a trained legal professional (such as those offered by Artful Contracts).
- Understand the contracts you’re using by getting familiar with the basics of a good contract.
If you’re looking for a specific type of contract template, visit the templates page. There, you’ll find contracts for:
- course creators
- web designers
- podcast guests
- virtual assistants
- event planners
If you have questions about the professional contract templates offered by Artful Contracts, check out the FAQs.
A huge thank you to Jenny Dang for telling her story.
To learn more about Jenny, visit her website, JD Design Art, at www.jddesign.art or follow her at @jdmarketsart.
Want more ways to protect your business? Download the 9-Step Checklist to Legally Protect Your Business.