You are currently viewing Do Freelancers Need Contracts?

Do Freelancers Need Contracts?

You’ve decided to do some gig work to make fast pocket money and now wonder if freelancers need contracts.

The honest answer is: it depends.

I am not a lawyer. I’ve never been a lawyer. I never even dated a lawyer.

All I can tell you is that I have always had some kind of contract while I’ve been a freelancer. When I work through an agency, I have a contract with them. Gig sites like Fiverr and Upwork have contracts in place as well. If you’ve driven for Lyft or Uber, you signed a contract when you registered with them.

The key is that this contract doesn’t need to be long and involved. You just need it to be enough to protect yourself and the client. If your side hustle gets traction, you should look into setting up an LLC. And for that, you definitely will want legal advice.

If you’re going onsite to repair something, you may want to create an estimate of work. In that, you can put your warranty or no assumption of liability statements.

Some freelancers are able to negotiate an implied contract in email.

So, if you’re working through an agency or a company, you’re covered.

If you’re working on your own, look into getting a simple contract that protects yourself. The contract is most important with a new client and clearly defines your scope of work. That sets expectations.

If the customer turns into something longer term, then you can get by with email detailing the scope of work. You also can detail payment. Since you’re working on short-term gigs, you should intend to be paid upfront or at the time service is rendered. If you’re doing something more involved like website or graphic design, have at least 1/3 be paid upfront, and set up a milestone in the middle where you get paid if things are progressing.

This helps in two ways. First, you continue to get money. Second, you’re checking in with the client and verifying that the project is on target. Then you get paid on delivery. If anything goes awry, at least you’ve gotten 2/3 of the money.

For small price items (under $500), you should be able to get it all upfront. A contract is a statement of trust. And if they don’t trust you with the pay, then they may not be the best client for you.

Again if you’re working through Fiverr or another site, they get the money from the buyer and hold it in escrow until you’re both satisfied that the contract terms were met.