Agreements (Consulting)

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• A consulting agreement (also known as a business consultant agreement, freelance agreement or independent contractor agreement), defines the services that a subject matter expert (SME) for some particular area of knowledge or specialized skill will perform for an individual or legal entity.

 

• At a minimum, a consulting agreement should define: the commencement date (generally meaning the date the work is to begin, regardless of the date the agreement was executed by both parties), or the effective date (generally meaning the date the agreement takes effect, regardless of when the work may begin or the date when the agreement was executed by both parties) or the execution date (the date that both parties execute the agreement, regardless of the date on which the work is scheduled to commence or the date the agreement takes effect); the names and legal entities of the respective parties, including all contact information for each such party; an extremely-detailed description of the specific type of work to be performed by the SME, including what information or materials must be provided by the client as a condition precedent for the SME to commence and complete the work; a broad, general recitation of the types of work or functions that the SME will not be performing for the client during the term of the project, and including an affirmative representation by the client that the client shall not rely on the SME (whether explicitly or implicitly) to provide any such type of work or functions; the duration of the agreement, specifying the original commencement, effective or execution date, and the date on which the term of the agreement ends, and any provisions allowing extensions (either automatically or by specific actions taken by the appropriate party; termination (whether automatically on a certain date, or by cause – through the occurrence of certain acts of breach or default during the normal term of the agreement – or for convenience (of either party, for no particular reason), and including the appropriate protocol to be used for each such type of termination; the compensation to be paid to the SME under what milestone schedule, and including what expenses may be reimbursed to the SME by the client, under what circumstances; a statement that the SME shall keep the client's product and company information confidential (such as industry secrets, designs, ideas, how the company is performing, and anything that a competitor might use to its advantage against the client); a noncompete clause, requiring the SME not to compete with the client's business at a similar type of company during the contract term for a specified period of time, and perhaps within a defined geographic area (if not too broad) after the SME completes the work, and also perhaps including an affirmative representation by the SME that the SME will not work for the client's competitors or customers and will not solicit the client's employees for some defined period of time; a statement that the SME is an independent contractor in relation to the client, and is not the client's employee or partner; a statement defining the ownership rights between the SME and the client for any intellectual property – such as copyrights, inventions, patents or trademarks – for any object produced by the SME for the project; the governing law for the agreement; data privacy; data security; entire agreement; governing law; indemnification; insurance; limitation of liability; no guarantee (meaning that the SME does not guarantee that the outcome of the work will be exactly and precisely what the client had envisioned, but it will be substantially close); standard of conduct by SME during the performance of work; venue for dispute resolutions; and, severability.

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    Last updated 201019_1439