How to write a contract for services? (With Templates)

Using a contract for services ensures that a client and service provider are on the same page about their working arrangement.

Read on to find out what a contract for services is, and how to write one to your advantage.

1. What is a contract for services?

A contract for services (also known as a ‘client contract’, ‘client services contract’, ‘client services agreement’ or ‘agreement for services’) is a contract between a service provider and a client. It fleshes out the details of the work to be performed by the service provider and usually contains the terms and conditions for the provision of services, including details of remuneration, responsibilities of both parties, and a timeline for the completion of the work.

Check out DocPro’s templates for Service Agreements for Small Contract Work and Long Term Service Agreements.

2. When do you need a contract for services?

Service providers may use a contract for services when they perform services for clients. Clients may use a contract for services when they opt to hire a service provider to perform jobs.

Often, only when services are performed over a significant duration, parties involved may want to enter into a contract for services to protect their interests. This is especially the case when a required service has a detailed or complex job scope. For example, when requiring the services of an event planner, an Event Planning Service Agreement may be valuable in detailing the intricate specifics of the event and the responsibilities of the event planner.

3. Why is a contract for services important?

Compared to oral understandings, a written contract for services outlines the important details of the arrangement on paper, providing much more certainty. As a service provider, you can ensure that you will be duly paid for the services you provide; as a client, you can make sure that details of the arrangement, particularly those about duties and confidentiality, are clearly stipulated.

Misunderstandings are often accidental but arise frequently. You can use a contract for services to minimise the potential for confusion and stay on the same page as your service provider or client during your arrangement. Simultaneously, you can also minimise the chances of dispute. 

4. Who needs contracts for services? (And the common types of contracts for services)

A service provider can be any individual or company who provides a service to other parties for remuneration. Many businesses and professionals rely on contracts for services in their day-to-day life. Service providers such as consultants, freelancers, photographers, web developers, editors, caterers and cleaners may all make use of contracts for services.

Contracts for services encompass a huge variety of work. Read on to learn more about some popular service categories and the corresponding contracts for services available on DocPro.

(i) Social media, data-based and web-based services

It is imperative that web-based or social media-based platforms are well-curated and maintained, and that intellectual property and data are protected.

You may require contracts for services such as:

• • Social Media Marketing Service Agreement
  • Web-Designing Service Agreement
  • Website Development Service Agreement
  • Website Maintenance Service Agreement
  • Website Hosting Service Agreement
  • Data Processing Agreement
  • Data Sharing Agreement

(ii) Event-based services

Even for one-off events like birthday parties or wedding banquets, you can contract different personnel like caterers, photographers, bartenders and DJs to ensure your event runs smoothly.

You may require contracts for services such as:

• • Food Services Service Agreement
  • Event Photography Service Agreement
  • Event Planning Service Agreement
  • Bartending Service Agreement
  • DJ Services Agreement
  • Limousine Services Agreement

(iii) Maintenance services

You may find yourself needing the maintenance or repair services of professionals with expertise in plumbing, landscaping and vehicle repair, for example.

You may require contracts for services such as:

• • Snow Plowing Service Agreement
  • Lawn Maintenance Service Agreement
  • Plumbing Services Contract
  • Landscaping Service Agreement
  • Pool Maintenance Service Agreement
  • Vehicle Repair and Maintenance Agreement

(iv) Transportation and moving services

Moving to a new home or office is no easy chore. In such circumstances, you may enlist the help of moving services or truck driving services to help you relocate smoothly. 

You may require contracts for services such as:

• • Truck Driving Services Agreement
  • Moving Services Service Agreement

(v) Security services

Having a robust security system with competent security personnel is essential to the smooth running of any business or residential complex. You may require the assistance of a security service contractor which can provide its security staff with relevant training and provide you with industry-standard professional services.

You may require contracts for services such as:

• • Security Services Agreement

(vi) Financial services

Any company should strive to maintain a financially conscientious business practice. Hence, bookkeeping, payroll management and financial management are in-demand services for all types of businesses.

You may require contracts for services such as:

• • Financial Management Service Agreement
  • Bookkeeping Service Agreement
  • Payroll Management Service Agreement
  • Financial Advising Service Agreement

(vii) Recruitment services

As businesses expand, they may require more personnel to assist with operations. As such, businesses may approach staffing service contractors or recruitment service providers to identify potential candidates for their business.

You may require contracts for services such as:

• • Staffing Service Agreement
  • Recruitment Service Agreement

(viii) Educational, training and care services

Private tuition, personal training, coaching and daycare services may be offered both by large companies and private individuals.

You may require contracts for services such as:

• • Private Tutor Service Agreement
  • Personal Training Service Agreement
  • Coaching Service Agreement
  • Day Care Service Agreement

(ix) Artwork commissioning services

Commissioning artistic pieces is a fantastic opportunity for collectors and artists. In recent times, commissioning artwork as non-fungible tokens (or ‘NFTs’) is especially prevalent.

You may require contracts for services such as:

• • Commissioning Agreement for Artistic Works
  • Commissioning Agreement for NFT Artwork

(x) Freelance work arrangements

Freelancers may enjoy offering services on a self-employed basis since they can control their workload and maintain a flexible work schedule. Companies may benefit from hiring freelancers because of their special expertise and need for less supervision.

You may require contracts for services such as:

• • Freelance/Independent Contractor Agreement

5. How to write a contract for services?

Ensure that you complete all necessary steps and create a contract for services easily based on DocPro’s templates. Before you start drafting a contract for services, make sure you fully understand the process of entering into a contract for services.

(i) Researching the other party

Thoroughly researching the other party’s reputation and background is crucial for clients to ensure that services will be completed professionally, and for service providers to ensure they will receive timely remuneration.  This is especially important for clients and service providers entering into long-term service arrangements so that they can manage their expectations.

(ii) Discussing the provision of services

Having a thorough discussion with the other party about the provision of services is very important. At this stage, it is imperative to review the expected fees and job scope, among other important terms and conditions. 

(iii) Drafting the contract for services

It is critical to put your oral arrangement into writing. At this stage, it is essential to lay out specifics about the terms of the arrangement in detail. Read on to find out what essential clauses to include in a contract for services.

(iv) Signing the contract for services

After confirming that you are satisfied with the specifics of the arrangement, the contract should be signed by you and the other party to formalise the arrangement.

A contract for services should first contain a description of the parties involved in the arrangement. This includes personal details such as names and addresses of both parties, as well as the type of entity they are (for example, whether the party is a corporation or a limited liability company). 

Despite the wide variety of contracts for services available, most share the following essential clauses:

(A) Scope of services and obligations

In this section, parties should specify the scope of the services expected and the obligations of both parties in exhaustive detail. Important information such as a timeline of services, expected services and work done, the start and end date of the provision of services, and all duties, obligations, functions, or products expected by the client should be outlined.

Job types may range from a one-off job to jobs with an indefinite work period. Hence, the time period should be clearly stipulated to manage the expectations of both parties.

To prevent misunderstandings, an accurate description of services should be included in the scope of the agreement so both parties are on the same page. For example, in a contract for catering services, the hours the caterer is expected to spend at the event, the number of servers, the number of attendees to be served, and the type and amount of food served must be stipulated.

(B) Payment terms

Parties should plainly stipulate the service provider’s remuneration. Depending on the work done, parties may agree to hourly wages, payments for each individual project or other types of payment methods. Some clients may prefer to make their payment according to a predetermined payment schedule, which should be clearly displayed.

Additional fees may also be agreed upon by the parties. For example, additional expenses incurred by the service provider over the course of the arrangement may be included as part of the service fee.  Also, parties may agree on a mandatory late payment and interest fee on the late payment if the client misses the due date for payment of the invoice. 

(C) Liabilities and indemnities

In this section, parties effectively promise to indemnify the other party if it has to make payments to cover specified damages or losses suffered due to the other party.

The indemnity and liability clauses may cover liabilities involving third-party claims against the indemnified party, such as infringement of intellectual property; and claims made between the parties, such as breach of contractual provisions.

Parties can customise the amount of risk they are willing to undertake by altering the clauses to demarcate their scope of liability. Such clauses will allow parties to protect themselves more efficiently from damages and disputes. 

(D) Warranty

Warranty clauses provide assurances by one party to another that it has the authority, power and capacity to enter into and carry out obligations in the contract and that it has taken necessary steps to ensure that its obligations and undertakings are lawful.

In the context of a contract for services, parties may also provide a promise with a warranty that their services or end-product will be of a particular standard or quality.

Parties can use warranty clauses to protect their expectations and interests, since a breach of a warranty by one party allows the other to make a claim for damages. 

(E) Term and termination

This section is important in setting out the specified completion or end date of the service provision period so that the client fully understands the period of service and the service provider comprehends the length of service he or she has entered into.

On top of that, circumstances warranting termination, such as bankruptcy of either party or if the service provider fails to meet his or her deadlines, can be included in the contract to help both parties understand their obligations under the contract.

Crucially, the rights of termination by either party and the requirements of serving a termination notice should also be discussed in this section. Parties may choose to stipulate that they no longer have any outstanding claims against one another post-termination.

(F) Dispute resolution mechanism

Misunderstandings can often be avoided by clearly stipulating terms and conditions in a contract. However, disputes are inevitable. In such circumstances, dispute resolution mechanism clauses outline measures to resolve disputes amicably and in good faith. For instance, parties may opt to use arbitration to resolve any disputes.  

Additional contractual terms may be inserted into a contract for services, based on your individual needs:

Non-compete clauses: used in a contract for services, non-compete clauses can prevent a service provider from working in direct competition against the client, especially when a service provider has close contact with a client’s insider information.

Confidentiality clauses: especially important in data management or processing services, confidentiality clauses prevent a service provider from sharing the client’s private or proprietary information. The scope of confidential information that may be used or shared by the service provider must be clearly demarcated.

No matter what your profession is or what services you require, a contract for services is valuable in protecting your interests. Fully understanding the essential provisions of a contract for services and the process of writing a contract can ensure that you have a smooth working relationship with your service provider or client.

Please note that this is a general summary of the position under common law and does not constitute legal advice. As the laws of each jurisdiction may be different, you may wish to consult your lawyer.