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3 Tips For Reading Contracts As A Self-Employed Freelancer

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I’ve never read a contract all the way through. Honestly, if they wanted them to appeal to me, they wouldn’t make the font so small!

I didn’t go to law school for a reason, and that reason is that I found something else to do instead. I became a freelancer because I wanted more freedom in my career—it’s right there in the title. Unfortunately, one of the side effects of that freedom is contracts. Every time I take on a new client, I get a new contract.

It can be stressful to put your name on so many legal documents, but just remember that freelancers aren’t alone in this regard. Every time you agree to a Terms of Service or sign a waiver to take a yoga class, you’re putting your name on a legal document. And you’re not alone if you don’t read legal documents all the way through—91% of Americans don’t read the Terms of Service. Honestly, though, I’m more surprised by the 9% who do. What’s in them?

Websites like DocuSign make contracts feel casual—I don’t even need to sign my name anymore, I just need to click a button. Unfortunately, just because the technology has evolved doesn’t mean the law holds any less weight.

So yes, it’s good to read contracts, sometimes. Put that on a coffee mug! For tips on how freelancers can get the most critical pieces of juice from legal forms, read on:

Know What to Look For

My recommendation is that when you get a contract, read through the most relevant parts carefully, even if you’re going to skip the rest. A few of the sections I’ve found most important include:

  1. Scope of Work or Services: This basically means making sure that what you agreed to do aligns with what the company is asking. Ensure that the contract clearly outlines the deliverables, deadlines, milestones, and any other relevant details—or you risk not getting paid. You never know who’s trying to screw you, so be careful with this part.
  2. Intellectual Property Rights: Who owns what you’ve created? If you want to turn the company’s website copy into a TV show later on, do you get compensated, or do they? This part of the contract says who will own the intellectual property created as part of the work or services and whether there are any limitations or restrictions on the use, transfer, or licensing of that intellectual property.
  3. Payment Terms: The most important one, in my opinion. Understand how and when you will be compensated, including details about invoicing, payment schedules, and any penalties or late fees. Are you able to receive money in the way they want to pay you, or do they only pay via illegal bank wires? Be aware of any provisions related to expenses, reimbursement, or additional compensation. It’s depressingly common for clients not to pay freelancers, so make sure the exact terms are hammered out in this section.

Ask Questions

Once you’ve read through the relevant parts of a contract, ask questions. You can’t guarantee the client will be honest, but it never hurts to try. If there are any legal terms or concepts you’re unfamiliar with, seek clarification from the other party before signing. Sometimes, I’ve asked the client, only to be told something along the lines of ,“that’s just standard legal jargon, it doesn’t mean anything.”

If I’m still confused after asking, there’s one more thing I consider…

Ask a Lawyer

I said at the beginning that I’ve never read a contract all the way through. That was a lie. The truth is, I have read contracts all the way through. I just didn’t get much from them, so I gave up. But if the contract is important enough—either because it’s a huge amount of money or because I don’t totally trust the client—I do want eyes on it. Not always my own, though.

I cannot, in good conscience, not recommend you sometimes consult a lawyer. If you’re unsure about any aspect of the contract, the most risk-free way is to get a professional. They can provide guidance, help you understand the legal implications, and advise you on potential risks and concerns.

“Freelancers may not need to have every agreement reviewed by counsel, but they should never sign a document that they don’t fully understand,” says Robert Freund, an attorney focused on advertising and e-commerce issues at Robert Freund Law. “If there’s any uncertainty as to the effect of a particular clause, it’s worth the small investment to work with experienced counsel to get that understanding. But most properly drafted contracts for the same kind of work should look similar—any significant departures from the norm should be carefully considered.” It’s expensive, but it may be worth it, depending on the scope of the project.

We all hate reading contracts, but figuring out which parts are most relevant to you and seeking clarification or legal guidance when you’re confused could wind up saving you thousands of dollars later. And it’s surely more interesting than PostMates’ Terms of Service.

Source: Forbes

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