As a freelancer, what do you think the most important part of a services agreement is? Is it the compensation rate 💵, the contract duration ⏱, or the terms of service 🤗? Whatever your priorities are, it’s essential to have a proper services agreement before working with any client 😇.
So, what elements do you need to include in a services agreement? Read on to find out!
What Is a Services Agreement?
A services agreement is a written contract that binds 📎 a client to someone providing third-party services, like a contractor. It’s sometimes also called a “general services agreement” or a “service contract.” Service agreements exist in two primary forms: 1) Ongoing partnerships (for an extended period) or 2) One-time deliverables (for a limited time frame).
A services agreement states:
- The services anticipated from a provider
- The schedule
- The compensation rate
Many service agreements in the United States also define the rights and requirements of both parties. This includes confidentiality and limitation of liability guidelines 😎.
Do I Need a Services Agreement?
Whether you’re a content provider, influencer, or provide some other kind of additional services, you should use your services agreement each time you work with another organization. This also applies to when you contract someone else to provide services to your business 👊.
Taking time to carefully prepare the entire agreement guarantees consumer protection and clarifies expectations 👌 for both parties (content provider and client). It gives the client a heads up about exactly which tasks and additional services you plan to provide. Finally, if you and the client should get into a squabble, your services agreement can come in handy as a guide for how to handle the situation.
4 Key Components of a Services Agreement
A good service agreement is clear and comprehensive. It states every aspect of the deal for both parties. While the contents of your service agreement are really at your sole discretion, there are four areas you don’t want to miss.
1. Names of Parties Taking Part in the Agreement
When crafting ✍ a services agreement with a client, the first thing to state is to include a legal name and email address for both parties. This might seem obvious, but some people do forget to do this! You can also provide additional information like:
- Telephone number
- Mailing address
- Billing address
Keep in mind that if either party is a business entity, the agreement should state 🗣 whether it’s an LLC (limited liability company) or a corporation. You can then include contact information for a person representing the company (e.g. you as a rep for your business).
2. Details of the Anticipated Services
When crafting a services agreement as a content provider, it’s important to state the nature of the services the client can expect 👱. An accurate description of your services goes a long way toward preventing misunderstandings that could result in a claim in arbitration. For example, do you provide consumer accounts or a specific consumer asset to your clients? Do you use any external services to augment what you offer?
Outlining the materials and resources required to provide a given service successfully has more benefits than simply preventing litigation. By including service-specific additional terms about what the client gets, you can prevent issues like violating intellectual property rights and expectations of third-party content you don’t provide.
3. Fees and Payment Schedules
Your services agreement with a client must state your fees and billing cycle 🕰. You can include details such as how you want to get paid and whether you’ll receive the payment in installments or in full 💰.
What if you’re entering into a longer-term agreement with regular payments? You can decide to receive your dues on a regular schedule, like once every 30 calendar days. You can also clarify whether you’ll charge extra costs when you receive late payments.
Here are some specifics you can include in this section. Just make sure your terms follow laws and payment method rules in the United States or wherever you’re located.
- Eligible payment methods 💵 (such as bank routing, internal transfer, or a Stripe account)
- Billing cycle
- Who covers fees from third-party services like payment processing services, payment method providers, and payment method acquirers
4. Timelines for the Contract (Including Terms for Contract Termination)
This is where you ensure continuity of service by setting up your timeline. Both parties must agree on the contract’s start date 📅 for the contract. This entails the official day when work begins (mostly the day of signing the contract). Next, outline 📋 the work schedule for your service offerings so that the clients get to know the deliverables of each milestone.
From time to time, someone may need to end a contract early. You can describe instances that may lead to termination 🤓 of the contract at any time without notice in your agreement. This could be due to:
- Intellectual property infringements
- Violation of intellectual property rights
- Violation of consumer protection rights
- Customer data leaks
- Failure to provide proper customer care
- Third-party claims
- General violations of the services agreement, such as refusal to use specified payment method providers and payment method acquirers
Cases of fraud or personal injury could also lead to the suspension of the contract for a while. Including what happens in those cases can help prevent any disagreements should this occur (although hopefully it won’t).
Do You Need Help with Your Services Agreement?
Before drafting a service contract for services in the United States or elsewhere, it’s important to know what to include 🤔! Drafting ✍ a good service agreement clarifies everything and smooths your working relationship from the get-go.
If you need help with creating a services agreement 💪, you can book a consultation with us 👉 here or purchase 💸 our customized services agreement template. Act now, and protect your business with a great services agreement!