Outsourcing Agreement Between Two Companies Template for England and Wales

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Key Requirements PROMPT example:

Outsourcing Agreement Between Two Companies

"I need an Outsourcing Agreement Between Two Companies for outsourcing our IT support services to a third-party provider starting March 2025, with particular emphasis on data security requirements and service level agreements for 24/7 support."

Document background
An Outsourcing Agreement Between Two Companies is a comprehensive legal document used when one business entity wishes to delegate specific functions or operations to another company. This agreement, governed by the laws of England and Wales, establishes the framework for service delivery, performance standards, and commercial terms. It addresses critical aspects such as data protection, intellectual property rights, employee transfers under TUPE, and risk allocation. The agreement is particularly important in today's business environment where companies increasingly focus on core competencies while outsourcing supporting functions to specialized service providers.
Suggested Sections

1. Parties: Identifies and defines the contracting parties, including registered addresses and company numbers

2. Background/Recitals: Sets out the context and purpose of the agreement

3. Definitions and Interpretation: Defines key terms used throughout the agreement and interpretation rules

4. Services: Detailed description of services to be provided, including scope and service levels

5. Term and Termination: Duration of agreement and circumstances for termination

6. Charges and Payment: Pricing, payment terms, and invoicing arrangements

7. Service Levels and Performance: Performance standards, KPIs, and measurement criteria

8. Data Protection and Security: Obligations regarding data handling and security measures

9. Confidentiality: Protection of confidential information

10. Liability and Indemnities: Allocation of risks and limitations of liability

Optional Sections

1. TUPE Provisions: Required when staff transfer is involved - used when employees may transfer between parties

2. Anti-Bribery Compliance: Compliance with anti-corruption laws - used for international services or high-risk sectors

3. Change Control: Process for managing changes to services - used for complex or long-term arrangements

4. Force Majeure: Provisions for unforeseeable circumstances - used when service delivery might be affected by external events

5. Step-In Rights: Right to take over services - used for critical services or regulated industries

Suggested Schedules

1. Service Description Schedule: Detailed specification of services

2. Service Levels Schedule: Detailed performance metrics and measurement methods

3. Pricing Schedule: Detailed pricing structure and calculations

4. TUPE Information Schedule: Details of transferring employees if applicable

5. Data Processing Agreement Schedule: Detailed data protection obligations and procedures

6. Business Continuity Plan Schedule: Disaster recovery and service continuity procedures

7. Exit Plan Schedule: Procedures for service transition at contract end

8. Governance Structure Schedule: Management and escalation procedures

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions
Clauses
Relevant Industries
Relevant Teams
Relevant Roles
Industries

Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE): Protects employees' rights when a business or service transfers to a new provider, ensuring continuity of employment terms and conditions

Employment Rights Act 1996: Fundamental UK employment legislation covering basic employment rights, including contracts, unfair dismissal, and redundancy

UK General Data Protection Regulation (UK GDPR): Post-Brexit data protection regulation governing how organizations must handle and protect personal data

Data Protection Act 2018: The UK's implementation of data protection laws, working alongside UK GDPR to regulate personal data processing

Copyright, Designs and Patents Act 1988: Protects intellectual property rights including copyright, designs, and patents, crucial for outsourcing agreements involving IP

Contracts (Rights of Third Parties) Act 1999: Governs how third parties may enforce terms of a contract to which they are not a direct party

Companies Act 2006: Primary legislation governing company operations and corporate activities in the UK

Network and Information Systems Regulations 2018: Legislation ensuring network and information system security, particularly relevant for digital service providers

Health and Safety at Work Act 1974: Primary piece of workplace safety legislation ensuring worker protection and safe working environments

UK Bribery Act 2010: Anti-corruption legislation that applies to both domestic and international business activities

Competition Act 1998: Regulates anti-competitive behavior and ensures fair market practices between businesses

Privacy and Electronic Communications Regulations (PECR): Specific rules for electronic communications, including marketing, cookies, and electronic service provision

Trade Marks Act 1994: Governs the registration and protection of trademarks, important for brand protection in outsourcing relationships

Unfair Contract Terms Act 1977: Regulates contracts by restricting how businesses can avoid liability through contract terms

Financial Services and Markets Act 2000: Regulates financial services and markets, particularly relevant for financial sector outsourcing

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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