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The gig economy is a phrase that is becoming increasingly commonplace. It refers to an environment in which temporary employment is the norm and organisations increasingly rely on contractors and freelancers for short-term or one off engagements.
According to a study by Intuit, the gig economy already accounts for a third of the US workforce, and by 2020 this will rise to 40 percent. In the UK, the same pattern is obvious, and there has been widespread concern that gig workers are not adequately protected by the government.
While the parliamentary debates will doubtless continue for the foreseeable future, there are some areas in which freelancers, contractors and those on zero hours contracts can protect themselves. One is by ensuring they have adequate contractual protection in place right from the outset.
Of the above three examples, perhaps it is the freelancers who are most likely to dive into action without any form of contract in place. All this does is leave them and the project on which they are working exposed to risk. With no contractual terms agreed, there is a higher likelihood of things going wrong and the freelancer not being paid.
A freelance contract does not have to be complicated, but it does need to include some core ingredients, including the following:
1) Pricing
It seems obvious that you will not be working for nothing, but get the pricing and rates crystal clear and memorialised in writing. If you are charging by the hour, it is a good idea to include a minimum and maximum work-hour clause for the project. This ensures both you and the client are protected.
2) Invoicing
It is not just the how much but also the how of payment that needs to be agreed. For a larger project, you might bill weekly or monthly, or perhaps the client pays 50 percent upfront and 50 percent on completion. Also incorporate payment terms stating how quickly the invoice must be paid on receipt. And bear in mind that as a general rule of thumb, the larger the company, the slower they are at paying their bills!
3) Cancellation or kill fee
There are always times when a project gets cancelled, and sometimes it is nobody’s fault. However, if you have spent time on it as a freelancer, it is only fair that you get paid for what you’ve done. A cancellation fee (often called a kill fee) clause provides protection in this eventuality.
4) Revisions and rewrites
Most freelancers accept that their work will sometimes need a little fine tuning, and are happy to do so for free. But when it gets to the 10th rewrite, it can become ridiculous. Protect yourself from this scenario by spelling out how many revisions you are prepared to do without charging. Most freelancers offer two.
5) Single point of contact
Nothing can be more frustrating that dealing with two people in the client company who have competing demands and wishes. A single point of contact clause does exactly as the name suggests, and keeps the communication channels simple and clear.
