Are you planning to hire a consultant or a freelancer? Have you been searching for a sample consulting agreement? It is a common thing as few businesses sail through without ever needing the services of an outside party.

Have you finally landed the client which you had been pitching to for a long time? If you have doubts about what they are and why to use them, you’ll find your answers below.

Alternative Names of Consulting Agreement

There are several ways of referring to the consulting agreement. It’s sometimes called a ‘Business Consulting Agreement’ or a ‘Consulting Contract’.

If you are hiring a freelancer, you may call it a ‘Freelance Agreement’. If you are working with a contractor, it may be referred to as an ‘Independent Contractor Agreement’.

Whatever your preferred name maybe, in the end it is still the same thing, and you can benchmark your contract on our consulting agreement template.

What Is a Consulting Agreement?

A consulting agreement is a formal written document between the consultant and the client that outlines the terms of their relationship.

Signing a consulting agreement when hiring a consultant, contractor, or freelancer, who will be providing his expert services to your company in exchange for monetary compensation.

It can be for the duration of a specific project, or for a specific time period, or even indefinitely for ongoing services.

When Should I Use a Consulting Agreement?

You should use a consulting agreement whenever you are entering in a freelancing work relationship with an outsider. It will be clearer from the examples below:

For the contracting party:

Use a consulting agreement if you or your company is hiring a consultant to design any product or perform any specific service. For e.g., hiring an outside party to implement your advertising campaign.

For the contracted consultant party:

Use this if you’ll be lending your service to someone in exchange for money. For e.g., if you are entering a freelance designing project for your clients’ product range.

There are many cases when a company needs to hire the services of experts to help in the business. You may need to work with individuals like an architect, a graphic designer, a writer, etc.

Whatever side of the deal you are on, our consulting agreement template will work wonders and help you get started on your core job sooner and with confidence.

Why Should I Use a Consulting Agreement?

A consulting agreement is a formal written document that has value for both parties. We have listed some of its benefits below:

  • Better Than Oral Deals: It is quite difficult to prove oral agreements in the court. But if you had a written agreement, the court will generally always follow it even if it disagrees with it.
  • Prevents Confusion: It is an important tool of negotiation and can help prevent future misunderstanding about the scope of work and client expectations.
  • Security About Payment: While you are working on your assigned task, a formal consulting agreement gives you the security that the payment will be paid as per the pre-decided amount and timeline.
  • Security About Data-sharing: The various non-disclosure clauses makes it safer to exchange sensitive information with the other party and get the job done.

What Are Included in a Consulting Agreement?

Following points are the basic essentials for a consulting agreement:

  • Details of the parties: Name and contact details of both the hired service provider and the customer.
  • Service details: Clearly mention what work is to be done by the consultant.
  • Duration of the agreement: Till when will this agreement be valid.
  • Fee details: Specify the negotiated payment and also mention when the payment will be made to the contracted party.
  • How to deal with materials: For example, if a consultant is preparing a new product or service for you, then clearly mention who will have its ownership right at the end of the contractual period.
  • Confidentiality clause: This protects the hiring company as the consultant is barred from sharing sensitive details like the client lists, marketing tactics, trade secrets, etc. with any outsider for a specified time period.
  • Non-competition & non-solicitation clause: These prevent the consultant from indulging in unfair competition tactics and from soliciting the customer’s clients.
  • Governing jurisdiction: This clarifies in advance how any dispute between both parties will be handled.

How is an Employment Agreement Different From a Consulting Agreement?

An employment agreement is used to hire the employees for your firm. On the other hand, a consulting agreement is used to hire the services of a consultant, or a contractor or a freelancer for a limited time period.

To make it clearer, consultants or freelancers work for themselves and they do not have an employer. They provide you their expert services in exchange of money and can be working with multiple firms or individuals at the same time.

Since these contracts are different, a consultant agreement template is also very much different from an employment agreement template. Make sure you use the appropriate one.

How is a Non-Competition Clause in a Consulting Agreement Different from a Non-Solicitation Clause?

These two are important clauses that you will see in any consulting agreement template.

  • A non-solicitation clause restricts a consultant’s interference with the client’s relationship with his employees or other contractors.
  • On the other hand, a non-competition clause protects the hiring company from unfair competition with the consultant after the end of the contractual period.

The clauses should be framed with due thoughts as they may not always be enforced by courts.

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Are you now convinced to sign a consulting agreement? It’s a detailed document that protects both the consultant and the hiring company and you should definitely consider one rather than rushing with a simple handshake deal.

CocoSign has developed a wonderful consulting agreement template that you can use. Prepared diligently by experts, it can save you significant legal expenses and help you quickly start your business activity.


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