Contract of service : outline your specific duties
You should take as much time and effort as needed to make sure that your form service agreement is as favorable to your company as possible and most accurately reflects your company’s objectives. Contract of service comprises a common law basis of the contract of employment and a range of statutory provisions. It is therefore often vital to determine the status of employment with a person. It is vital the three conditions below are fulfilled by the parties upon entering into a contract of service your agency agrees that, in consideration of a wage or other remuneration, he will provide his own work and skill in the performance of some service for his employer. Agrees, that in the performance of that service he will be subject to the other’s control in a sufficient degree to make that other employer. The other provisions of the contract are consistent with its being a contract of service.
Key to drafting an efficient contract of service
When preparing a contract, it’s important to define the parties. For many reasons, the introduction should reflect if parties are individual or business entities.
It also should provide any other relevant identifying information. Companies should state their state of formation and entity type. Defining the parties provides you with the information you need to perform basic research.
The most critical component of your service agreement is the description of services. For some reasons, you should define the services as precisely as possible.
In discussing services, the client expects their fees to include certain perks or actions you never contemplated.
From a negotiation and clarity standpoint, it’s a much better approach to define services. And then leave it up to the client to propose anything extra that they might need. The contract should also define any extra services as in detail with related fees.
If the business is to integrate a technology platform with a client’s existing work environment, then the agreement would have to specify whether any services, beyond installation, is covered by the company’s initial fee.
Fees and Expenses are a key component in a contract of service.
A company’s service agreement reflects the price structure that is most appropriate for your business. It should state whether your company compensates on a per-project basis or an hourly, weekly, or monthly fee basis.
If charging the same rates for all clients, then include these numbers in the contract. Otherwise, you should leave blanks that can be filled. This is depending on your negotiations with each respective client.
The agreement should also state how often the client requires to make payments. Also the acceptable methods of payment. For example, bank wire, money order, credit card, or PayPal. Furthermore, your service contract should make it clear how expenses allocate between parties. The client expects you to cover all expenses involved in delivering the services. Depending on the nature of your business, the client might agree to be responsible for certain expenses. You can negotiate to have the client pay for these expenses either ahead of time or as a reimbursement to the company.
Contract Term and Termination. Your service agreement should state the term of the contract. It should also include any renewal provisions. It should also state the circumstances under which either party is to end the agreement.
Contract termination rights associated with events of default. The agreement should outline what forms a default by either party.
As discussed above, your company’s services should be described specifically. So that your company doesn’t breach the agreement, resulting in an accidental termination. Furthermore, note that terminations and defaults rely on proper notice. So your contract should include an adequate “notices” provision in the miscellaneous sections.
It’s customary for service agreements to include provisions on the protection of confidential information.
- the safeguard of your business strategies
- client lists
- supplier information
- Trade secrets, and so forth
Note that a client might request that you adjust the confidentiality provisions. So that they’re applied, which is usually acceptable so long as all your employees, contractors, and everyone else involved in your business handle all client information in compliance with the provision.
Proprietary Rights are another key component in drafting contract of service. They are the intellectual property rights in anything that your company creates.
Depending on the nature of your business, the protection of proprietary rights might or might not be very important. A proprietary rights provision makes it very clear that your company will own all intellectual property related to anything produced for the client.
Cooperation is another key component. Your form agreement should include provisions that the client cooperates with the company. The client should provide information or aid the company needs to allow it to fulfill its obligations. Without such cooperation, your company can’t perform efficiently.
Indemnification is another point considered. The client should be responsible for any damages suffered by the company. This is in the event of misuse or misappropriation of the services.
Addendum for work orders simplifies your service agreement. It can incorporate the likelihood that there will be many projects in the future. In these cases, you can construct your service agreement to expect work orders that join in the future.
Your boilerplate contract should conclude with the standard. Miscellaneous provisions included in the vast majority of contracts.
If these key elements are followed you can secure your company and employees or business with ease.