I do most of our first-round contract review (we almost always end up getting things reviewed but once in awhile you get lucky and can accept a contract without it) and snags I've hit that this contract seems likely to hit:
* Doesn't establish independent contractor relationship
* Asks for no pre-approval on expenses
* Non-mutual indemnification
* The contract as written is assignable, so you can sign it and immediately sell the contract to someone else
There's probably a reason why Confidentiality agreements in normal contracts are a page long rather than just two sentences, too, but I don't know what that is.
I love that it's just a Google Doc though.
> The Client agrees to indemnify, save, hold harmless and defend the Contractor from any and all damages, liabilities, costs, losses or expenses arising out of any claim, demand, or action by a third party (including reasonable attorneys’ fees and expenses) as a result of the work the Contractor has done under this Contract.
(Without the explanatory footnotes, of course.)
The non-solicitation clause also sticks out to me because it seems a bit odd. I’ve never come across something like this in an agreement with a freelancer and I think I would be suspicious if someone tried to include this in an agreement. Are they going to try to poach my people as soon as the contract ends? I think it’s better to just leave it out - I can’t imagine many corporate attorneys would look for this specific clause, let alone insist it’s included. I don't work in Silicon Valley though so it might be different there.
Finally, this one is nit-picky, but it looks like you have a duplicate “is” in the second sentence of the agreement. (It’s captured in the screenshot on your site, too.)
 That means I've never given an agreement back to a contractor without redlining it – we just can’t help ourselves!
 Indemnification typically occurs after the matter is settled. That means if the Contractor gets sued for the work done the Contractor would foot all the legal bills and once the proceedings are complete the Client would cut a check to the Contractor for the costs incurred. Most freelancers don’t have the deep pockets their clients do so that could put them in a precarious financial position. Adding the duty to defend here means the Client would have to actively fund the Contractor’s defense of the claim, not just reimburse it. In some states this is assumed to be part of the indemnification but in others it must be specifically included in the agreement.
 Likewise, in some states attorneys’ fees are not considered part of the indemnification unless expressly stated and whether or not litigation expenses such as e-discovery or an expert witness are covered is still debated so it's best practice to clearly include them.
3 out of every 5 clients of ours takes our unilateral indemnity clause (our legal was optimistic!) and simply reverses it so it works for the client and against us. I'm pretty close to offering mutual indemnification simply to avoid round trips. Anyways my point is that, as the representative of corporate attorneys on this thread, I blame you.
Entirely warranted. We're nothing but an expensive headache to everyone on both sides of the table.
Just to be clear: not a lawyer! Just a consultant who deals with a lot of contracts in his job.
The Stopping Work section wasn't meant to give contractors the right to stop. If the client materially breaches the contract by not paying, they can get out of their own obligations. I added Stopping Work mostly because it comes up a lot, so it's nice to have terms in the contract, rather than background law, to point to. But also so I'd have a place for the deadline-postponement and fees-keep-adding-up terms. Those don't go without saying.
I hear you on Conflicts. There's no escape valve in the section for contractors who do often work for competing interests. I might look into adding a mechanism there, so the contractor can write in the names of competing clients for preclearance, that gets signed as part of the contract.
Your toint on subcontracting is well taken, but note that Personnel allows statements of work to override the contractor's ability to use employees and contractors at will. When folks use the form as individual contractors, or when clients use it to hire specific people at firms or studios, the SOW can specify a named individual, and prohibit subcontracting.
They also don’t want the contractor to disclose anything about their business or the project to anyone else, which is why they’ll never expect you to provide a competing clients list. If they ever start to inquire, that line of questioning is trivially shut down by pointing this out. You take confidentiality seriously, and that applies to them as well.
That aside, it’s a ridiculous proposition. They are hiring you as an expert in this domain because of your experience. If you’d signed such an agreement with the first company to suggest that, you would not be able to offer your services to the client.
However, the desire for experience with competitors doesn't exclude valid concerns about ongoing, concurrent relationships serving competitor-clients. To borrow from legal ethics, it's one problem to have information from one client that could be useful to another, and a distinguishable but related problem to face a conflict of interest, with both sides expecting undivided loyalty. Terms about work for competitors assume, practically, that confidentiality obligations will break down when the contractor works for both sides concurrently. We can't build Chinese Walls in our minds, or in small firms of a handful of people.
Back to the terms, note that "Early Termination" gives each side the power to terminate early, with a given number of day's notice, for no reason at all. The main effect of "Conflicts" is to require the contractor to notify the client of potentially concurrent work for a competitor. If the client has concerns, they can terminate immediately, instead of with n days' notice. It's fundamentally about ensuring the client the information they need to make use of their termination right.
The checks are Substitution, Direction and Control, and strong clauses in these will protect both the client and the contractor from a nasty tax bill.
Most US lawyers advise reciting independent-contractor status, anyway. Some forms include obligations to comply with tax laws in accordance with that characterization. Some go even further, and have contractor indemnify client for wage, benefit, and other reclassification-related claims by putative subs.
Where reclassification is particularly risky, lawyers will often include recitals that go to the relevant factors, like independence, self-direction, use of own equipment, and so on. Intuition says that language may be stronger when they it speaks in terms of the specific work to be done, rather than generic features of a generic independent-contractor agreement.
As tptacek pointed out - there is no chance that this document would survive first contact with a sophisticated party and any qualified lawyer would likely rip this to shreds.
Firstly there is no regard to the potential jurisdiction that the user chooses. If I were to put in England then that would mean there are different contractual implications to choosing Scotland. Ditto for states in the USA. A layperson won't know this, and a lawyer would need to review the provisions.
There are also a ton of generalised terms in this document where things like 'intellectual property rights' aren't defined. These aren't generic terms and in the event of a dispute, language really matters. There is a reason why contracts are much longer when professionally written.
This isn't to attack the idea, I'm hugely in favour of open access to legal documentation, but people need to realise that most legal work is bespoke - even if law firms do it on a 'churn' basis. This is a great effort to further open law but it's dangerous for people to rely on this.
Source: I'm a software engineer and a qualified lawyer
I imagine there is no shortage of demand for your cross-section of skills?
Do you utilize them both, or did you pivot from one to the other?
Also, some small-scale practice areas like family law have form generator tools.
Part of the problem is that legal teams don't understand how this software works, and the companies that create it use salespeople who will promise all kinds of things, so you end up in the situation where an in-house team has been told it will cut down their hours by X%, the software isn't designed for whatever task it has been sold for, and it becomes a hack job to make it do so.
The areas like family law (or particularly executries) are great for document generators. Similarly in corporate where there is a lot more routine work. These have already come into law firms in a big way but it's not particularly innovative (though still welcome).
In fact, I wrote and published a plain-language contractor agreement of my own, Fairshake, some time ago.
I've also published Switchmode, an independent contractor agreement for software developers doing mixes of open source and closed source projects for their clients:
I'd love to collaborate on terms, and potentially on standardization. For my latest and best on how to bootstrap standard commercial terms, have a look at the Canting Tribe NDA, a self-marketing nondisclosure agreement:
An interesting story.
I have a standard contract I usually use with startups etc. that is written to be fair to both parties and vetted by multiple attorneys. One that I worked with insisted that I use theirs. When I went through it, it was clear that they took it from a template and there were numerous holes in it that I pushed back on. They stated that all of their other contractors used it successfully and I replied that these people must not have read the contract.
It was at that point that I pointed out that the jurisdiction, "Orange County Georgia" does not exist (they had obviously copied it from a California template or contract) among other things. Against my better judgement I re-wrote their contract and used it. They ended up being a major pain in the ass client that was really bad at basic communication. IE: would not answer direct questions in writing with yes or no answers.
Contract negotiations are often a sign of things to come with the rest of the engagement.
I'd qualify this with "if the person(s) you will be work with are the sticklers for the contract."
Often contracting is just a line item for the manager that wants to get going and the legal rep is the one causing the delays. When this is the case I don't find the experience with the legal team has much bearing on the experience actually doing the work.
However, I am going to be really honest - as the CTO of a company who regularly hires freelancers and as a former lawyer, I would never sign this contract if the freelancer I was using sent it to me.
Section 2.1 is much too weak and will give the hiring company problems if they were undergoing diligence for an equity round. Please consult any IP lawyer if you doubt me.
Less of an issue but section 1.4 also does not restrict the nature and amount of expenses.
You can also create an Issue or submit a PR on GitHub if you would like to contribute directly: https://github.com/jackmorgan/the-plain-contract/
I'm honestly not doubting you, I just don't understand, not being really versed in legalese. What's that "diligence for an equity round" thing? How is "you own all the things" too weak legally speaking?
I (really) don't know if this is a big deal for due diligence but a hiring party would likely strike this language immediately.
This leaves it open to a court fight over what ‘everything’ means in the context of the document.
I can only speak for the jurisdiction I know (and I am not a lawyer, just a former freelancer), but in the UK this contract would not be suitable for someone wishing to operate outside of IR35 (disguised employment rules) as it makes no mention of substitution, direction or control, which are the key factors when determining IR35 status.
Not necessarily a failing of the project, but perhaps it could mention more explicitly that it's for US jurisdiction
(For UK freelancers I recommend looking at IPSE membership which includes access to their contract templates which are good and commonly accepted as standard contracts)
How can it be so difficult to create a contract framework? How can there possibly so many variations on that theme that you need a lawyer to do that?
I do understand that there are circumstances where legal advice is necessary. But at least 90% of all freelance (and other) contracts should be coverable with a manageable number of if-else-conditions.
Also the question whether the framework is applicable should be answerable through a couple of if-elses.
I can't wrap my head around it.
If you google "how do I write my own contract" you go down a rabbit hole of impossible to reconcile contradictions and absurdity.
I find legal drafting and programming to be remarkably similar. And I think you get the same rabbit holes when googling either way, but when you're developing the feedback you get for the "solution" you found on Google is almost immediate. The function either works as you expected or it doesn't. When you're drafting an agreement you might not find out that the snippet of legalese you found worked in a way you hadn't anticipated for years, or decades later, if ever.
There's also the added complication that the law is constantly changing. When you're developing you know you're using Language X v10. And when the meaning of a reserved word needs to change, everyone upgrades to v11. We can't (yet!) update all of our contracts every time a court ruling calls the interpretation of a clause into question. Add to that the complication that sometimes the courts don't even agree on the interpretation of something for years. It's as though a team of programmers are all working on the same project without a GitHub repo.
Source: Lawyer who codes.
If I gave you documentation for Oracle you’d probably be at a loss too. My friends mom had a book stack one meter high off the floor.
Why do we even need written contracts? Isn't your word good enough?
When things go sideways is when you need a legally sound contract.
For example, if there was a dispute, every overbroad term in this contract will be fought over in court (this example has words like 'everything' and 'any reason' figuring out what these words mean in court will cost tens of thousands of dollars in legal fees. And, after you pay all your legal fees, a judge will decide what you meant.
Not that many licenses really.
The fact the number of variations on the simplest possible EULA still approaches 100 does rather underline why lawyers are still used for more complicated things though.
I wrote my own contract that is written plainly, I borrowed the bulk of it from a similar effort to this one and heavily modified it. It acknowledges that it is written plainly and that where any ambiguity exists, it's presumed both parties are reasonable and responsible, are not malicious and that all effort will be expended to resolve problems as such before resorting to the legal system to settle a dispute.
The most important and most complex part is indemnification. You don't want to mess that section up. It outlines who is responsible, how responsible, type of responsibility and where they are responsible (if you are in a different part of the country or world). It has to fit with whatever your professional indemnity insurance is.
The Client has the opportunity to suggest changes if something is important to them - but only up to a point.
It works for me and I don't work for huge or faceless organisations, ymmv.
The freelance community is really missing some good open source / legit free software and resources, I hope more things like this pop up.
While the contract defines the legal CYAs, etc, the SOW help define the relationship without all the heavy-handed language gymnastics.
Full disclosure, I am a founder of Anvil
If you need a good contract, don't be a dufus. Hire a lawyer who will ask questions and stand professionally accountable to you. I am doing neither here.
GitHub Link: GitHub can be good, but you really, really have to use Markdown, one paragraph per line, or at least another supported prose format, to get much collaborative benefit. You want good prose and word diffs.
Instructions: Listing out the blank placeholders first, with instructions to find-and-replace, is a neat approach. It pays to think about how form contracts will get handled.
Preamble: There's no need to spell out party names there, though it's traditional. If their info appears on the signature page, it's clear who's entering the contract. DRY.
Payment: I'm not quite sure which rate structure you have in mind, but it looks like an "x% up front" kind of thing, where the up-front payment is nonrefundable, and the balance is due on completion.
Expenses: I routinely advise clients to strike language authorizing contractors to incur and pass through whatever expenses they like. Reimbursement's usually limited to expenses set out in the contract/SOW, expenses preapproved by the client in writing, and possibly expenses below a threshold amount each, and an aggregate. On the latter think: "I'll reimburse you for expenses below $20 without approving first, but don't not more than $100 worth."
Invoices: Lawyers write additional payment obligations for late payment as interest, in order to avoid, first, courts reading the terms as penalties rather than agreed estimates of the damage late payment would cause, and therefore unenforceable, and second, to avoid usury laws that limit rates of interest.
I would be very surprised to learn that most contracts on this form actually complete on the scheduled invoice date. When contracts specify payment on completion, it usually goes: 1) contractor sends deliverables, 2) client accepts, or a deadline to accept or reject comes and goes, 3) contractor bills. Acceptance deadlines can be short. Depends on the work and the client.
Revisions: A fallback hourly rate can be a very good idea, depending on the work. Those interested should have a look at the form packet AIGA published for design contractors. I could improve on specific language in that packet, but its substantive coverage is good for many solo and small-studio designers I know.
Ownership: I would definitely advise being more explicit. In general, copyrights move from authors to clients in two ways: assignment and "work made for hire". Since not all copyrighted work can be "work made for hire", it's a good idea to spell out the mechanisms by which everything goes over. Also, beware of California work made for hire statutes tying to employee status:
That being said, under our new California ABC test, I'm not sure who isn't arguably an employee. But I digress.
And that's just copyrights. Clients want patents covered, too.
Authorship: I would rename this "Portfolio Use" or similar, and also make it more explicit. Again, I believe AIGA covers this.
Confidentiality and Nondisclosure: Either "Confidentiality" or "Nondisclosure" would suffice. I'm all for short, pithy NDAs. But I don't think this is a very good one. A marking requirement gives a lot of clarity, but very few companies actually do that. NDA obligations typically don't survive perpetually.
I'd put a term in saying that the client and contractor will sign an NDA on a separate, standard form. Plug: https://nda.cantingtribe.com.
Non-Solicitation: Stated too broadly. And probably unnecessary, for freelancers working for companies.
Representations: The rep included is common, but also kind of pointless. What happens if the side signing doesn't have authority to contract?
The key reps in freelance design, software, and other creative contracts cover IP. Specifically, that's where contractors typically guarantee that they aren't plagiarizing others' work, or including outside material they haven't the rights to license.
Term and Termination: Seven days is short, but termination at will is common. It's not clear how to calculate fees pro rata, given the x% up-front payment. If the client terminates the freelancer because they're terrible, does the client have to pay them more money? Only if they're >x% into the scheduled length of the contract?
Limitation of Liability: As I mentioned about reps above, deliverables usually do come with explicit reps. However, the terms usually disclaim reps not in the contract itself, like reps implied by law, by default. Damages cap at fees paid is typical.
Indemnity: The Client indemnifies the Contractor for the Contractor's work??? Typically, Contractor would indemnify Client, for damages related to breach of IP reps and employee reclassification, and perhaps others. Client might indemnify Contractor for providing materials for use in deliverables that create IP or other issues.
I have not commented on terms that I think this form is missing. Cost-benefit of including more terms to head off more kinds of potential issues differs by contractor and client, and definitely tends shorter for smaller parties and smaller dollar amounts. But this feels a bit lean to me, for just about anybody.
IP rights: All rights are assigned. Most projects will be more nuanced than this in terms of IP split, both in terms of pre-existing IP and third party/open source IP. Both these are ignored. I would expect there to be more nuance around this. This may give more comfort both to the client and the contractor in terms of knowing what they are getting, and what they are handing over respectively. Also, no mention of moral rights, which you would usually expect to see waived, or at reference to copyleft restrictions.
End dates: This provides an absolute commitment to deliver work by a certain date. I don't think this is advisable from a contractor's perspective. At the very least it should be made subject to timely receipt of client inputs.
Non-solicit: Plain English seems broader than a standard non-solicit. Usually a standard non-solicit would link to employment by the solicited person by the soliciting entity or solicitation being for the benefit of the soliciting party. This just states any action to encourage someone to leave is a breach. Also, it's more normal for this to be reversed so that the client is restricted from soliciting employees of the contractor (obviously not as relevant in a single freelancer scenario though).
Term and termination: Sure, flexibility over termination is a good thing (because if it's not working, it's not working), but giving the contractor the right to terminate on 7 days' notice is likely going to lead to objections from the client, when in most cases the contractor should be willing to commit to a job or at least a longer notice period. On the flip-side, giving a client a termination right on 7 days is more understandable but certainly from a contractor's perspective I think more certainty over contract duration is preferable.
Indemnity: Client -> Contractor indemnity is obviously preferable from a contractor perspective, but any client is going to want to have a reciprocal indemnity, or at least an indemnity in respect of third party IP. Generally considering the client will have leverage, it's important to acknowledge that. Presenting a document with a client only indemnity risks that in my view! In some ways it's probably better not to put the word indemnity in a contract sent to a client, because it'll just make them start thinking about what indemnities they should take from you, and whether or not they should send this to their lawyer/legal department (if they have one).
Jurisdiction: In most jurisdictions, you would get away with these kinds of general legal provisions. However I would usually expect some thought to have been given to local law.
Payment: Giving the contractor the right to add interest to overdue sums is often a powerful tool to ensure you get paid. In the UK at least we have legislation to that effect so it doesn't necessarily need to be stated (but often good to bring to the attention of the client anyway).