How to create a contract for freelance work: The keys to succeed

I’m lucky. I’ve been freelancing for over ten years successfully. I’ve never had a client fail to pay, radically change the scope of a project, or otherwise break an agreement. But in freelancing, this is a rarity.

An ironclad freelance writing contract can prevent many of these problems. But maybe you feel overwhelmed or confused about where to start. In this tutorial, I’ll walk you through the importance of a contract for freelance work. I’ll also explain the steps you can take to create a contract of your own.

We’ll explore key things to include. And we’ll look at template designs that help you build a freelance contract of your own.

It’s important to note that this article is not specific legal advice. Instead, think of these as general tips for freelance work contracts. You’ll see freelance writer contract templates, but the actual legal language is best written by a proper attorney who’s familiar with contracts.

What a contract does (and why you always need one)

Many freelancers believe that contracts create extra work. You trust your clients, so why add extra paperwork to the process? Intimidated by legal documents, freelancers too often skip them entirely and rely on good faith from both sides. 

What if I told you that contracts actually reduce complexity? With clearly defined terms, protections, and scope, having a contract frees you up to do your best work. They bring clarity and specifics to creative work.

The primary purpose of a contract is to set out the details of your relationship with the client. A freelance contract also works to protect both you and your client if things go wrong. Let’s explore key reasons to use a contract for every engagement.

Contracts protect both parties

If the client refuses to pay or claims that the rate you agreed is lower than it actually was, you could have a problem. When no freelance writing contract exists, disagreements can become a matter of one party’s claims against the other’s.

With a contract, everything is clear. It ensures alignment. And in fact, the mere existence of a contract can help you avoid costly legal disputes altogether.

From the client’s point of view, a freelance contract is valuable, too. It gives them protection in the working relationship and ensures that you deliver on your performance. Don’t think of a contract as an antagonistic document. It’s really meant to help you, and your client, work together more effectively.

The contract states what work you’re expected to do, and gives clients recourse if you don’t do the work. Make sure that what you’re committing to is reasonable and clearly defined. 

Contracts establish clarity and scope

The primary purpose of contracts for freelancers is to protect both sides in case of a dispute. But a side benefit is that it provides clarity about the scope of what you’ll deliver.

This side benefit has actually been the main benefit of contracts for me personally. One main problem in freelance work is clients with unclear or unrealistic expectations. A freelance contract sets out in black and white exactly what the client wants, and what you expect. It can flag problems early on, saving you a world of pain later on.

Hopefully, you’ll never have to resort to taking legal action based on your freelance contract.  Simply having this greater level of clarity makes it worth drawing one up.

How to create a contract

So you know what a contract accomplishes and why it’s so important to have one. How do you go about creating one?

Understanding the types of contracts

First of all, you need to understand what type of contract you’ll be using. Often, clients will hand you an agreement they’ve used before. But if it’s up to you to provide one, it can be hard to know where to start. Let’s start by thinking of them in three key categories:

• A contract for single, one-off projects.
• An ongoing contract for freelance work, with an agreed rate for each assignment completed.
• A retainer agreement, where you receive payment without specifically defined work tasks.

Let’s talk about how to manage contracts, based on the type of work performed.

1. One-off projects

In the case of single, one-off projects, you’ll want the contract to be very specific about what’s included. Focus on what you’ll need from the client, what you’ll deliver, when you’ll deliver it, and what the payment terms will be.

The key here is to focus on clarity and detail. Your contract should clearly outline each of the points outlined above. Be specific about the scope of work to avoid any potential misunderstandings or scope creep.

Payment terms are also crucial in one-off project contracts. You might consider requesting a deposit upfront, with the remainder due upon completion. Alternatively, you could structure payments around project milestones. Whatever you choose, make sure it’s clearly stated in the contract.

It’s also important to include provisions for revisions or changes. Specify how many rounds of revisions are included in your quoted price. Then, clearly call out what constitutes a revision versus a new project altogether. This helps prevent the dreaded “just one more small change” scenario that handcuffs freelancers.

Also consider including a clause about project cancellation. What happens if the client decides to halt the project midway? It’s reasonable to collect at least partial payment. Having this spelled out in advance can save a lot of headaches later.

2. Ongoing contracts

With an ongoing contract for freelance work, the details may not be quite so specific. That’s because both you and the client will want to leave some room for changes over time.

Ongoing work will naturally evolve and perhaps even change over time. Thus, you need some flexibility built into your contract to account for this. What’s important here is to decide which parts could shift, and which are defined in the contract.

You may include rates for different types of work. Imagine, for example, if the assignments vary a lot. Here, perhaps set a minimum amount for each assignment, with a rate scale for longer projects.

You may want to set minimum or maximum numbers of assignments (or hours of work) per week or per month. The idea is to leave room for flexibility, but also set some parameters on things that are most important.

3. Retainer agreements

With a retainer agreement, uncertainty is the name of the game. Here, you make yourself available to work for the client as needed, in return for a regular payment.

Imagine that you’re a web designer. The client keeps coming back to you asking for lots of small changes to the site. Here, you could use a retainer agreement instead of billing each change individually.

You get paid an agreed amount per month, and work on projects as needed. You get a regular, predictable income stream. The client gets your continued availability. It’s a win-win.

The key here is to focus on scope. Exactly how much work is included in the retainer agreement? Set a limit in terms of hours per week, or whatever measurement makes sense in your case. It’s crucial to be clear on this limit.

Retainers are open-ended by nature, but it’s okay to put guardrails in place with the help of a contract. You might need to periodically revisit the retainer payment and what’s covered.

Learn more about retainer agreements below:

• 

  How to Offer Ongoing Freelance Services on Retainer

  

  Thursday Bram

  08 Oct 2012

Options to create a contract

You’ve established what sort of contract you’re preparing. Now you need to decide what approach to take to create something suitable.

The best approach is to hire a lawyer to draw up a contract for you. While you’re sure to incur some cost, think of it as an investment in your business. This investment can give you a rock-solid contract that protects your downside and ensures that projects stay billable.

If you can use this contract as a template for other assignments, the investment may be worth it. Plus, remember that you’re protecting yourself with a freelance writing contract.

Looking for less costly options? There are plenty of freelance work contract template designs available online. You’ll find many freelance contract templates at Envato. The key is to understand that these are just starting points, not the finished product. They have pre-built designs that are ready for proper contract language.

Another option is to adapt contracts you’ve already used for other clients. Again, you’ll need to do some work to make the contract relevant to the work you’re doing for the new client. But old contracts can be a great place to start. As you do more work, you can build up your own library of freelance writer contract templates to use.

If you don’t have previous contracts, ask around. Find other freelancers who do similar work and ask if they can share the contracts they’ve used (with sensitive details omitted.) Or check a professional organization in your field. Many of them provide suggested templates you can use. Try organizations like AIGA, the professional association for design, which provides a standard form of agreement for design services.

Key areas to focus on in contracting

Whichever approach you take, you’ll need to make sure that the contract covers certain key areas. You have your own priorities based on the type of work you do and what’s important to you. But these things will be important to include in most freelance contracts:

Payment amount and terms

It’s natural to focus on the bottom line: how much you’re getting paid. But there are many other details you need to include. When will you be paid, for a start? Is there an upfront fee? Do you get paid on the completion of milestones in the project? If so, how are they defined? 

For all payments, be sure to include a deadline. These are your payment terms. They’re in place so that clients can’t boost their own cash flow at your expense. And you’ll know when you’ll enjoy the cash flow!

Intellectual property

This one is crucial, no matter what type of work you do. You need to establish who owns the rights to what you create for the client.

In general, copyright belongs to the creator of the work. You have two options here. You can transfer those rights to the client, or create a license that allows the client to use your work. Standards can vary across industries, so do some research to find out what’s customary in your field. 

The important thing is to make sure you understand which rights you’re giving up. If you’ll need to use any elements of the work in future (for example, as a case study on your website), specify in the contract that you have the right to do so. You may also want to specify that the client only has the right to use the work after payment has been made.

Project scope

Clarity around project scope is essential. For example, a contract that says you’re due $1,000 on completion of a website design is no good. It leaves the door open to questions like these:

• What exactly are you providing?
• What resources do you need from the client to get it done? 
• How much time do you have?
• What happens if you miss the deadline because of delays in getting what you need from the client?
• How is the “completion” of the design defined? 

You need to insert as much specific language here as possible. This ensures that both you and your client know what’s included and what’s not, and helps avoid dreaded “scope creep”.

Provisions for cancellation

What if the client has a change of course and no longer needs your services? What if you have a sudden emergency and can’t fulfill your part of the bargain? Unexpected changes can happen, and a good contract makes provision for them.

As a writer, I often include a provision for a “kill fee” in my contracts. If the assignment is cancelled when I’ve already started work on it, I receive a proportion of the fee (often 50%). If it’s an ongoing contract or retainer, consider including a notice period on both sides for the cancellation of the agreement.

Liabilities

What happens if the work you produce creates a problem for your client? Maybe the code you produced has a glitch that causes the client to lose sensitive data. Maybe the logo you designed is too similar to another company’s, and your client gets sued for trademark infringement. Maybe that provocative statement you included in their website copy gets them sued for libel.

A lot can go wrong, and a freelance contract needs to establish what happens in that case. The important thing here is to be fair and to stand behind your work. Never agree to too much and open yourself up to career-ending liabilities. The sample contracts we’ll look at in the next section contain some suggested wording.

Contract samples and other help

If you want to start from a template, there’s lots of help available online. Just keep in mind that you’ll need to adapt the templates to your own circumstances. Many of them are also designed for use in particular countries. You may need to word things differently in your jurisdiction. In any case, here are some useful resources.

A good place to start is LegalTemplates. It’s an online resource to create basic contracts for freelancers. You can create a freelance contract online and download or print it.

Another great tool is the Freelancers Union Contract Creator. You put in all your details using the web form, and at the end you get a contract all filled out and ready to use. You can skip learning how to write a freelance contract from scratch with this tool.

Then, try your local trade or professional organization. I’ve already mentioned the AIGA template for designers in the U.S. But in different industries and countries, there are plenty of other resources. Find a good trade association in your area, and either check the website or reach out for sample contracts.

What if the client has already prepared a contract?

Many clients will have an agreement already prepared for you to sign. If that’s the case, you’re spared the work of creating one yourself. But you should still read it carefully and make sure that it aligns to your terms.

Clients will often say that their contract format is “standard”. But in reality the wording can always be altered if you push hard enough. It’s tempting just to sign it—especially if you really want the assignment.

But keep this in mind. If you’re at the contract stage, the client has already decided you’re the best person for the job. They really want you too. Don’t be afraid to push back and stand up for your rights. It’s common to propose changes and go through several rounds. This practice is called redlining.

Apply the methodology we’ve talked about here to assess the contract you’ve been offered. Make sure that it covers the important points in a way that you’re happy with.

Again, seek out help from the appropriate freelance association, or ask other freelancers in your field. These valuable second opinions give you an important perspective. And if you can afford it, hire a lawyer to check it thoroughly.

Create contracts for freelance work today

You’re now in a position to create contracts for your freelance work. You learned how to write a freelance contract, and you’ve seen some different types of freelance contracts and learned the essentials to protect your business. I’ve also pointed you to some contract samples and templates that you can use as a starting point.

With any legal matter, there’s no substitute for hiring a good lawyer. But with what you’ve learned in this tutorial and the useful resources available online, you have a great starting point. Now, you can create a contract that covers the most important points. Remember: a contract is an important tool to protect yourself and avoid legal challenges.