Creating a Freelance Contract

Note: Want to skip the guide and go straight to the free templates? No problem - scroll to the bottom.
Also note: This is not legal advice.

Introduction

When it comes to freelance work, it’s essential to have a legally binding agreement in place. Without a contract, both parties can be left in a vulnerable situation and misunderstandings can arise. A well-crafted freelance contract should be seen as an integral part of any working arrangement and should clearly outline the scope of the project, timeline, payment terms and any other specific requirements. It should also address copyright issues, intellectual property rights and confidentiality; as well as include a termination clause that outlines the process for ending the relationship.

At Genie AI, we understand how important having a valid freelance contract is for freelancers and companies alike. That’s why our team provides access to millions of datapoints which teach Artificial Intelligence (AI) what market-standard contracts look like - so you don’t have to pay a lawyer to draft one for you. Our community template library enables anyone to customize high quality legal documents free of charge and with ease - meaning no more worry or stress over disputes or not getting paid on time!

On top of this security blanket that comes with having an effective agreement in place, there are plenty of other benefits too - both parties can focus solely on the project at hand instead of worrying about potential conflicts down the line; while provisions protect freelancers from being taken advantage of by their employers with regards payment and other obligations.

So if you’re considering starting out on your own freelance journey or looking to hire someone else’s services, make sure to take advantage of Genie AI’s step-by-step guidance on drafting up contracts today! Read on below for more information about how you can access our template library now!

Definitions (feel free to skip)

Deliverables: The services or products that a freelancer will provide to a company.
Timeline: A plan for when a project will begin and when it is expected to be completed.
Milestones: Smaller goals or accomplishments that must be achieved in order to reach the final deadline.
Deadlines: Specific dates that both parties agree upon in order to ensure the project is completed within the timeline.
Payment Schedule: When and how the freelancer will be paid for their services.
Contact Information: Details such as phone number, email address, and physical address that can be used to communicate with each other.
Frequency: How often the two parties should communicate.
Method of Communication: How they will communicate (e.g., email, phone, etc.).
Intellectual Property Rights: Who owns the rights to the project’s deliverables.
Protected Intellectual Property: Existing intellectual property that the freelancer or the company has rights to.
Limits of Liability: Outline of the risks associated with the project and how much each party is responsible for.
Liability Coverage: The extent of liability coverage for both parties.
Payment Methods: Which payment methods are accepted.
Payment Dispute Procedures: How payment disputes should be handled.
Termination Rights: The conditions under which the agreement can be terminated and the rights of each party after termination.
Confidentiality Requirements: What information is confidential and the terms for disclosing it.
Dispute Resolution Procedures: Process for resolving disputes between the two parties.
Executing the Agreement: Signing the agreement and distributing copies to all parties.

Contents

• Defining the scope of the project
• Identifying the project’s deliverables
• Establishing a timeline for completion
• Establishing deadlines and payment terms
• Determining when deliverables are due
• Establishing a payment schedule
• Setting expectations for communication
• Establishing contact information for both parties
• Outlining frequency and method of communication
• Establishing intellectual property rights
• Defining who owns the rights to the project’s deliverables
• Identifying any existing protected intellectual property
• Limiting liability
• Establishing the limits of both parties’ liability
• Defining the extent of liability coverage
• Outlining payment methods
• Specifying accepted payment methods
• Describing payment dispute procedures
• Establishing termination rights
• Outlining conditions under which the agreement can be terminated
• Defining the rights of each party after termination
• Setting confidentiality requirements
• Establishing what information is confidential
• Specifying the terms for disclosing confidential information
• Establishing dispute resolution procedures
• Identifying the process for resolving disputes
• Establishing a timeline for resolution and follow-up
• Executing the agreement
• Signing the agreement
• Finalizing any additional documents
• Distributing copies to all parties

Get started

Defining the scope of the project

• Clarify the roles and responsibilities for both parties
• Outline the project timeline and deliverables
• Determine the payment structure and terms
• Specify the project resources and requirements
• Review the project scope to ensure it is clear and accurate
• Once the scope of the project is clearly defined, you can move on to the next step.

Identifying the project’s deliverables

• Determine the specific tasks and deliverables that the freelancer will be responsible for providing
• Discuss the specific details of the deliverables with the freelancer
• Come to an agreement on the required deliverables and ensure that all of the requirements are understood
• Document the tasks and deliverables in the contract
• Once you have documented the deliverables in the contract, you can move on to the next step - Establishing a timeline for completion.

Establishing a timeline for completion

• Agree on a timeline for the completion of the project that is reasonable for both parties.
• Consider any other obligations the freelancer may have and factor that into the timeline.
• Make sure the timeline you have established is realistic and attainable.
• Set up milestones for the project and ensure that the freelancer is aware of them.
• Document the timeline and milestones in the contract.

You can check this off your list and move on to the next step when the timeline and milestones are agreed upon, documented in the contract, and both parties are aware and in agreement with them.

Establishing deadlines and payment terms

• Establish a timeline for when each milestone and payment will be due.
• Outline how long each task will take, and when each payment is to be made.
• Make sure both parties are in agreement on the timeline, and sign the contract.
• Keep track of deadlines and payments to ensure the contract is adhering to the timeline.
• Once all deadlines, payments and deliverables are met, you’ll know it’s time to complete the contract.

Determining when deliverables are due

• Establish clear deliverables and due dates in the contract
• Make sure the deliverables are measurable and able to be completed in a timely manner
• Ensure the deliverables are realistic and can be completed within the agreed upon time frame
• Discuss the timeline with the freelancer and make sure both parties are in agreement
• Once the timeline and deliverables are outlined in the contract, you can check this step off your list and move on to establishing a payment schedule.

Establishing a payment schedule

• Decide how the payment will be made (e.g. bank transfer, PayPal, etc.)
• Discuss the payment schedule (e.g. monthly, per milestone, etc.)
• Agree on payment terms (e.g. payment within 14 days, payment upon completion of work, etc.)
• Include payment details in the contract
• Once all parties agree to the payment schedule, the step is complete and you can move on to the next step of setting expectations for communication.

Setting expectations for communication

• Brainstorm any potential communication expectations you may have, such as the frequency of communication, the preferred method of communication, etc.
• Decide which expectations are necessary to include in the contract and which can be discussed and agreed upon informally.
• Draft a section in the contract outlining the communication expectations.
• Have both parties review the communication expectations and sign the contract.
• Check off this step and move on to the next step of establishing contact information for both parties.

Establishing contact information for both parties

• Collect the full name, address, contact information, and tax ID number of both the freelancer and the client.
• Ask the freelancer to provide an email address to send invoices and other communication.
• Ask the client for a point of contact for all communication.
• When both parties have provided the necessary contact information, you can check this off your list and move on to the next step.

Outlining frequency and method of communication

• Determine the frequency, method, and topics of communication between the freelancer and the client
• Consider the topics of communication such as project status updates, changes to the project, and other relevant issues
• Specify the method of communication, such as email, phone, video call, and other communication platforms
• Include the timeframe for communication, such as the hours and days of the week when communication can occur
• Outline the response time expectations for both the client and freelancer
• Indicate how any issues that may arise during the project will be addressed
• Once you have outlined the frequency and method of communication, it is complete and you can move on to the next step.

Establishing intellectual property rights

• Identify the specific intellectual property rights that are to be created for the project, such as copyright, trademark, and/or patent rights
• List the intellectual property rights and the party that will own them in the agreement
• Specify that any intellectual property rights owned by a third party must be cleared
• Include a clause stating that all intellectual property rights created by the freelancer in the course of the project will be assigned to the client
• Make sure that the agreement states that the client will be the exclusive owner of the intellectual property rights
• When you have established the intellectual property rights, check it off your list and move on to the next step of defining who owns the rights to the project’s deliverables.

Defining who owns the rights to the project’s deliverables

• Clearly state in the contract who owns the rights to the project’s deliverables and any related intellectual property
• Make sure to specify in the agreement if the contractor or the client owns the rights to the deliverables
• If applicable, specify in the contract if either party can use the deliverables for marketing or other purposes
• Make sure to include a clause in the contract for any potential licenses or grants that may be needed
• When you are done, review the contract to make sure the ownership of the project’s deliverables is clearly defined and that there is a plan in place in case of any intellectual property disputes
• Once you have reviewed the agreement, you can check this off your list and move on to the next step.

Identifying any existing protected intellectual property

• Identify any intellectual property that the freelancer is obligated to protect, such as existing copyrights or trademarks, as part of the contract.
• Have the freelancer acknowledge in the contract that any existing intellectual property does not belong to them.
• Make sure that the freelancer agrees to protect any existing intellectual property from unauthorized use or disclosure.
• Ask the freelancer to indicate in the contract that they are not authorized to use any existing intellectual property.

You’ll know you can move on to the next step when the freelancer has acknowledged in the contract that they understand their obligations regarding existing intellectual property.

Limiting liability

• Include a clause in the contract that states neither party will be liable for any consequential, indirect, or punitive damages
• Add a clause that limits the maximum amount of damages either party can seek
• Make sure the contract is specific in identifying the types of damages that can be claimed
• Make sure the contract also states that neither party is liable for breach of contract if the other party fails to perform

When you have included all of the clauses listed above, you can move on to the next step: Establishing the limits of both parties’ liability.

Establishing the limits of both parties’ liability

• Research applicable state laws and regulations regarding the limitation of liability
• Draft a liability clause that addresses the specific risks and liabilities associated with the freelance job
• Ensure that the clause is written in clear, understandable language
• Negotiate the terms of the liability clause with the other party
• Get the final version of the liability clause signed and dated by both parties

Once the final version of the liability clause has been signed and dated by both parties, you can move on to the next step- ### Defining the extent of liability coverage.

Defining the extent of liability coverage

• Research the local and state laws regarding liability coverage for freelance work
• Establish the extent of the liability coverage in the contract
• Include a clause in the contract detailing the liability coverage that both parties must adhere to
• Specify the extent of the liability coverage in the contract in a clear and concise manner
• Once the clause is included and agreed upon, the step is complete and you can move on to outlining payment methods

Outlining payment methods

• List out the payment methods that both parties agree to accept
• Make sure to include frequency (example: every two weeks) and payment due dates
• Review any applicable fees associated with the payment method
• Make sure to include the method for invoicing and the method used to track payments
• Once all payment methods are outlined and agreed upon, both parties should initial the contract
• You can check this step off your list and move onto the next step of specifying accepted payment methods once the payment methods have been outlined and agreed upon.

Specifying accepted payment methods

• Decide which payment methods you will accept from your client - e.g. cash, check, bank transfer, PayPal, Venmo, etc.
• Specify the accepted payment methods in your contract.
• When you have written down the accepted payment methods, you can check this step off your list and move on to the next step.

Describing payment dispute procedures

• Outline the process of filing a dispute if payment is not received or is late
• Include a timeline for the dispute process, such as how long the freelancer has to wait before filing a dispute
• Detail what action will be taken if a dispute is filed
• Allow for the option to escalate the dispute to a third-party, such as a mediator or arbitrator
• When the dispute process is complete you can check this off your list and move on to establishing termination rights.

Establishing termination rights

• Define the notice period required for either party to terminate the agreement
• Outline any consequences associated with terminating the agreement early
• Specify any compensation that may be due to either party in the event of termination
• Include a clause describing the respective responsibilities once the agreement is terminated

You’ll know that you have completed this step when you have outlined all the above points in the contract.

Outlining conditions under which the agreement can be terminated

• Include a termination clause in the contract, specifying how and when either party may terminate the agreement
• Outline the conditions that must be met for either party to terminate the agreement, such as providing written notice, abiding by certain timelines, or meeting other requirements
• Explain the consequences of termination and any remedies available to either party
• Be sure to include clauses that will protect both parties in the event of termination
• Once the termination clause is completed, you can move on to the next step of defining the rights of each party after termination.

Defining the rights of each party after termination

• Specify whether the freelancer can use the work/materials created for the client for other purposes and if so, under what conditions.
• State if the client has the right to use the work/materials created for the client for other purposes and if so, under what conditions.
• Establish the legal ownership of the work/materials created for the client.
• Identify any non-compete agreement between the parties.

Once both parties have agreed on the rights of each party after termination, then you can check this step off your list and move on to setting confidentiality requirements.

Setting confidentiality requirements

• Clarify what information is to be kept confidential by both parties
• Decide who will be responsible for maintaining the confidentiality of the information
• Determine what happens in the event of a breach of confidentiality
• Include a non-disclosure agreement (NDA) if necessary
• Ensure that both parties are aware of the confidentiality requirements

Once all of the above points have been addressed, you can move on to the next step of establishing what information is confidential.

Establishing what information is confidential

• Outline what information is confidential in the contract by using language that is clear and unambiguous
  -Clearly define confidential information, such as trade secrets, proprietary information, customer lists, and other sensitive information
• Make sure to identify any confidential information that is being supplied by third parties
• Make sure to list what information is excluded from the definition of confidential information
• Make sure to include a clause that states that the contractor agrees not to use the confidential information for any purpose other than the one outlined in the contract
• Make sure to include a clause that states that the contractor agrees not to disclose the confidential information to any third party
• Make sure to include a clause that states that the contractor agrees to return the confidential information to the company at the conclusion of the contract
• Make sure to include a clause that states that the contractor agrees to maintain the confidentiality of the information

Once you have included all the required clauses and defined what constitutes confidential information, you can check this off your list and move on to the next step.

Specifying the terms for disclosing confidential information

• Include a clause that states that a breach of confidentiality could result in legal action
• Specify the conditions and guidelines for disclosure of confidential information
• Determine how the confidential information can be used and how the information must be protected
• Outline the consequences for sharing confidential information without permission
• When all requirements of the clause are met, sign and date the contract

When you can check this off your list: Once all the requirements of the clause are outlined and the contract is signed and dated.

Establishing dispute resolution procedures

• Determine the dispute resolution process you’ll use (arbitration, litigation, etc.)
• Identify the governing law of the contract
• Consider any applicable state or federal laws
• Set the forum where disputes will be heard (local court, state court, etc.)
• Specify the process for filing a claim (who will file, who will pay, etc.)
• Include any applicable timelines for filing a dispute
• Outline how disputes will be resolved (timeframes, costs, etc.)
• Include a clause that states the parties will use their best efforts to resolve the dispute before resorting to legal action

Once you have determined the dispute resolution process you’ll use, identified the governing law of the contract, considered any applicable state or federal laws, set the forum where disputes will be heard, specified the process for filing a claim, included any applicable timelines for filing a dispute, outlined how disputes will be resolved, and included a clause that states the parties will use their best efforts to resolve the dispute before resorting to legal action, you can check this step off your list and move on to the next step.

Identifying the process for resolving disputes

• Determine which process for resolving disputes is best for your business (arbitration, mediation, litigation, etc.)
• Research the advantages and disadvantages of each option
• Consider any legal requirements related to dispute resolution
• Consult with any legal counsel you may be working with on the contract
• Decide on the process you want to include in the contract and document it
• You can check this step off your list once you have documented the process for resolving disputes in the contract.

Establishing a timeline for resolution and follow-up

• Set a timeline for when the contract should be completed, including any additional due dates if needed
• Create a timeline for how long the parties should be given to resolve any disputes that arise
• Agree on a timeline for when the parties should follow up with one another to ensure the contract is being upheld
• Make sure to include a timeline for when the contract should be reviewed and updated if necessary
• Once the timeline is set, make sure to document it in the contract
• This step is complete when the timeline for resolution and follow-up is set and documented in the contract.

Executing the agreement

• Receive signed copies of the agreement from both parties
• Ensure all details are accurate and that both parties have the same understanding of the agreement
• Exchange the signed copies of the agreement between both parties
• Once both parties have received their signed copy of the agreement, the agreement is executed and legally binding
• You can check this off your list and move on to the next step when both parties have exchanged their signed copies of the agreement.

Signing the agreement

• Have both parties sign the agreement in the presence of a witness.
• Make sure that all signatories have valid ID documents with them.
• Once all parties have signed the agreement, you can move on to Finalizing any additional documents.

Finalizing any additional documents

• Gather all relevant documents, such as Non-Disclosure Agreements, Non-Compete Agreements, and any other documents signed by both parties
• Make copies of all documents for each party
• Make sure all documents are signed, initialed, and dated by both parties
• Once all documents are accounted for and signed, you can move on to the next step of distributing copies to all parties.

Distributing copies to all parties

• Send a signed copy of the contract to each party via a secure method of delivery
• Have each party sign and return their copy of the contract
• Store a signed copy of the contract in a safe place
• Once all parties have returned a signed copy of the contract, you can check this off your list and move on to the next step.

FAQ:

Q: Do I need to have a freelance contract in place if I’m already incorporated?

Asked by Michael on May 16th, 2022.
A: Whether or not you need a freelance contract in place depends on your situation and the specific terms of your contract. Generally speaking, it’s a good idea to have a freelance contract in place even if you’re already incorporated. This will help ensure that both parties are clear on the expectations and that any disputes are handled in a timely manner. It’s also important to understand the local laws and regulations when it comes to freelance contracts. Depending on where you are located, there may be different laws or regulations for freelancers. It’s always best to consult with a lawyer or accountant to make sure that your contractual agreements are legally binding and compliant with local laws.

Q: What type of information should I include in my freelance contract?

Asked by Emma on October 20th, 2022.
A: When creating a freelance contract, it’s important to include all of the necessary information that applies to the project at hand. This includes the scope of work, payment terms, deadlines and any other relevant details. It’s also important to include any contingencies or additional services that may be included with the contract. Additionally, it’s important to ensure that both parties understand their responsibilities and rights under the contract, so it’s important to include any applicable clauses that apply. Lastly, it’s also important to ensure that both parties sign off on the contract in order for it to be legally binding.

Q: Are there any differences between US and UK freelance contracts?

Asked by Matthew on August 15th, 2022.
A: Yes, there are some differences between US and UK freelance contracts. For example, in the US there is often an implied “at-will” clause which means either party can terminate the agreement without notice or cause; however this is not the case in the UK where termination must be done with reasonable notice or cause. Additionally, UK contracts often include a “restraint of trade” clause which restricts what activities a freelancer can engage in during their working relationship with a client; this is not common practice in the US. Lastly, US contracts typically contain an arbitration clause which allows for disputes to be resolved outside of court but this is not always included in UK contracts. It’s important to understand these differences and consider incorporating them into your freelance contracts accordingly.

Q: How do I decide what rate I should charge for my services?

Asked by Sarah on January 3rd, 2022.
A: Deciding what rate you should charge for your services is an important decision and one that should be taken seriously. It’s important to consider factors such as the cost of living where you live, your experience level and expertise, the number of hours required for the job and any special skills you might have that would give you an edge over other freelancers. Additionally, it’s also important to consider market rates for similar services - taking into account factors such as location and demand - when deciding what rate you should charge for your services. Lastly, it’s also helpful to research similar websites or platforms that offer similar services so you can get an idea of what rates other freelancers are charging for comparable services.

Q: Is there anything else I should consider when creating my freelance contract?

Asked by John on April 17th, 2022.
A: Yes, there are several things you should consider when creating your freelance contract such as any applicable taxes or fees (such as VAT), non-disclosure agreements (NDAs) or non-compete clauses (NCCs), intellectual property rights (IPRs), payment terms and methods (such as invoicing), dispute resolution clauses (DRCs) and termination clauses (TCs). Additionally, depending on where you are located there may also be specific local laws or regulations which must be taken into account when creating your freelance contract as well as any industry-specific requirements which might apply in certain sectors or business models (such as SaaS or B2B). Furthermore, it’s also helpful to consider any additional clauses which may be relevant depending on your particular needs; such as confidentiality clauses or indemnity clauses if needed.

Example dispute

Suing a Company for Breach of Freelance Contract

• The plaintiff can raise a lawsuit which references a freelance contract if they believe the company has breached the agreement.
• The plaintiff should be able to provide evidence that the company failed to fulfill its obligations under the contract, such as not providing timely payment for services rendered, providing inadequate goods/services, or providing goods/services which do not meet the standards outlined in the contract.
• The plaintiff should reference relevant state and federal laws, such as the Fair Labor Standards Act, in order to argue their case.
• The lawsuit should also include information on how the plaintiff believes the company should compensate them for any damages they suffered due to the breach.
• Settlement of the lawsuit may include monetary compensation, the provision of goods/services, or the completion of any tasks or actions outlined in the original contract.
• If damages are awarded, the court may determine the amount of damages based on the plaintiff’s losses or may use a formula to calculate the amount of damages.

Templates available (free to use)

Freelance Agreement
Freelance Contributor Contract
Freelancer Contract

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