I know a lot of freelancers who eschew creating contracts and agreements for all kinds of reasons. It's not a great idea, though. Without it you're like an aerialist working without a net, exposing yourself to a lot of risk. And, damn, there are enough risks out there waiting to knock us on our asses. We don't need to make some more of our own. That's why this LinkedIn post from my friend, business consultant Jill James, resonates so much. I got her green light to share it here because I know it's relevant for a lot of you, too.
Do freelancers need contracts?
Additional thoughts on contracts
I've got two more thoughts on this subject (shock!).
1. Lawyer up. You may feel like you're too small or cash-strapped to have a business attorney. You're never too small, but you may be too crunched for cash. Still, it's worth it to talk to counsel to get a basic understanding of the minimum requirements for agreements you create, and a set of red flags for contracts you receive. Having a relationship with a good lawyer is worth whatever fee you're getting heartburn over paying. My IP attorney, Neal Wolgin, has saved me more than I've paid him in terms of actual cash, peace of mind on big or complex deals, and legit risks to my livelihood from highly restrictive clauses in contracts. Pro tip: Don't have a connection? Ask your banker, CPA, business consultant or a colleague in your area for a referral.
2. Read before signing. We all know this, and yet we still don't really comply, do we? We don't want to wade through dense legalese we can barely decipher. It's scary. It's intimidating. It's also really freakin' important. I get so many contracts with incredibly onerous non-compete clauses that seriously restrict my ability to run a business. Working with Neal, I can now spot them on my own and amend the contract accordingly (btw, your results may vary, but I have only once in 30 years gotten pushback from clients or their counsel.) And when I get confused or the contract is really long, I send it over to Neal for a quick review. Not only does this reduce my anxiety and risk, but it sends a signal to clients that I'm a detail-oriented, conscientious person. I'm amused (and maybe a little confused) that they're impressed I read and amend contracts -- seems like a business basic to me. Pro tip: Over the years I've found that more clients than not have never read the contracts they're handing out. Don't do this. You should know what you're requiring of your partners. See other ways to appreciate the freelancers you work with.
Legal matters can be challenging and anxiety-producing. That's why it's important to step into the scary and take the minimum steps to learn how to use contracts/agreements to protect yourself.