Taking on new work for another business or partner comes with exciting opportunities, not the least of which is an opportunity to grow your own business. And as a business owner yourself, doing your work comes at a cost. It’s important that you are compensated fairly (and timely) for any projects you enter into with another client.
The client services agreement (CSA) is often the contract of choice for documenting the scope, terms and other stipulations of the working arrangement. The price for doing your agreed upon work also goes here.
What to Include in the Compensation Section of the CSA
As you work through each section of your legal contract, it’s important to be as specific and detailed as possible. Any ambiguity leaves open the door for future disputes or litigation.
Scope creep is also a challenge businesses and independent contractors face, which is when the project’s scope begins to subtly deviate from the original plans, and little by little more work is added to your plate – work for which you may not be compensated, depending on the language in your contract.
To avoid potential confusion or conflict, clearly define your payment terms in the compensation section of your CSA. Here is where you will outline:
- Your fee for doing the work as described in the scope of services section
- How you would like to be compensated – some providers require a deposit to secure the services. You should also include your accepted methods of payment – check, wire transfer, credit card, etc.
- Your payment schedule and any late fees
It can be a real headache to have to track down late payments from clients, and it can throw a wrench into your financial planning. Be clear and firm in your CSA so you have a legal contract to point to in the event of any (non)payment issues.
And as always, our team is here to help. If you have concerns about your corporate agreements, please get in touch with us at the Law Offices of Alex D. Sirulnik, P.A.