Freelancers could easily get involved in legal issue when certain terms are not clear and that could leave them unprotected. Here are five red flags to watch out for in a freelancer contract.
1. A non-compete clause
Some companies have a standard non-compete clause in their contract. If you sign that clause, you can’t work for another business that offers competing services, which can limit your ability to seek new assignments. As a freelancer it is important to keep your options open to get future work.
2. No payment terms
If you’re a freelancer, you know that chasing late payments can be a huge hassle; one of the best ways to prevent this chase is to get payment terms written into your contract.
3. Ownership of your intellectual property
You might also see a clause in the contract that allows the company to take ownership over your intellectual property (IP).Request to have this clause removed or modified, and consult a lawyer as needed.
4. An indemnity clause
If you see a sentence that says that you the freelancer shall indemnify the client for any reason, you’ll want to contact a lawyer to help review the terms. Indemnity is compensation paid by one party to another to cover any damages or losses, and sometimes a client will put all of the liability on the freelancer, rather than taking ownership of any losses themselves. You will need to contact a lawyer to clarity this as it can be sticky.
5. Rights grabs
Writers and artists will also want to look out for language about rights. If you’re working under work-for-hire terms, you’re producing a product that the company owns. Consider which projects you want to own, sell, or syndicate.