Five Key Clauses You Need In Your Services Agreement

Sarah Haas

Business Advice,

Your potential client loves your work and wants to hire you. Now what? You need a customized client services agreement that clearly identifies the work you’ll perform, your client’s obligations, and the limits of your liability in case the business relationship goes south. Also remember that your client services agreement is a marketing opportunity and possibly the first example of your written work that your clients see. Here are five services agreement clauses you need to carefully draft to ensure that your contract protects your business.

  1. Description of your services. This should be the easiest section to draft, right? Wrong. You don’t want to overpromise what you’ll be providing (e.g., including unrealistic timeframes). You also don’t want to be too vague in describing your services such that neither you nor your client understand the scope of your work (e.g., providing marketing services or consulting services). Instead, describe your services with sufficient detail that your client understands what to expect but without being so specific that you overshare your process and methodology or set yourself up to underdeliver.
  2. Termination. Identify circumstances where you and/or the other party can terminate the contract, if any. Pay special attention to when you can terminate for the other party’s bad behavior, such as missed payment, loss of licensure, or insolvency.
  3. Other Party’s Responsibilities. You likely need information or work product from the other party to complete the services. Include the process and deadline for gathering client information in the contract, including access to creative assets, certain information, and individuals who have relevant information. If the other party’s failure to provide information will inhibit your ability to perform the services or to perform the services in the promised timeframe, say so.
  4. Representations and Warranties. Does your work rely on representations made by the other party? Include them in the contract. Limit your representations and warranties to narrow the scope of your promises, too.
  5. Liability and Indemnification. A thoughtful liability and indemnification provision offers significant legal protection for your business. Limit your liability to only certain conduct (e.g., gross negligence or willful misconduct) and disclaim liability for the rest. You may also consider limiting the amount the other party may recover from related to breaches of the agreement.

If you need help drafting the perfect client services agreement, we got you. Start with a template in our Contract Store or reach out to talk about a customized agreement.

Sarah K. Haas

Sarah Associate Attorney

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