Contract for Service Template: 5 Important Sections
It may not look that much different at first glance, but believe it or not, a contract of service is not exactly the same as a contract for service. Although there is no definitive test to distinguish one from the other, Singapore’s Ministry of Manpower has drafted a list of some of the factors that can be considered in identifying which contract is which.
Thus, before we explore what a contract for service template is, let us first define both terms and understand their key differences. Your scope of rights, duties, and obligations in the workplace will hinge on what kind of contract you have in your hands.
Definition of Terms
Contract of Service
A contract of service involves an agreement between an employer and an employee. This means that the employee conducts business for the employer. Additionally, the agreement may be covered by the Employment Act under certain conditions. The contract also includes terms of employment such as working hours, leave benefits, and whatnot.
Contract for Service
A contract for service, on the other hand, involves an agreement between a client and a contractor. In other words, the contractor carries out the business on their own account. Unlike the contract of service, a contract for service is not covered by the Employment Act. Statutory benefits such as those mentioned above also do not apply.
Contract for Service Template
A contract for service applies to freelancers or self-employed individuals. They are providers of a diverse range of services from marketing to writing and even technological support.
In spelling out both parties’ obligations and duties to each other, it is important for self-employed individuals or contractors to create a watertight agreement. This reduces the occurrence of disputes as the project kicks off.
Let us know take a closer look at the 5 main sections of a contract for service template.
1. Provision of Services By the Freelancer
Under this section, the contractor needs to clearly spell out the scope and limitations of his or her services. This can include expected working hours, frequency of output, and complexity of tasks. Misunderstandings are averted when expectations are clearly defined.
2. Responsibility of Fees, Expenses, and Liabilities
As the section name suggests, the contractor has to be straightforward when it comes to identifying fees, expenses, and liabilities.
It should be clear on both sides how much compensation the contractor expects from the project and what add-on services require additional payment from the client.
3. Confidential Rights, Obligations, and Duties of Both Parties
It goes without saying that freelancers also have rights and obligations. These need to be identified and listed as part of the contract for service template. On the flip side, the client must also stipulate their own expectations and duties toward the contractor.
4. Obligations of the Company
Depending on the scope of work, the company might need to create a separate section where all of its obligations are listed down. This will be for the benefit of both parties, to avoid future misunderstanding once the project has started.
5. Obligations Upon Termination of Agreement
For sure nobody would want to be in this situation. Nonetheless, it is important for the independent contractor or freelancer to make sure that his or her rights and interests are safeguarded in the event that the client chooses to prematurely terminate the freelancer’s services.
For instance, should the contractor be remunerated for the time and effort that has already been spent working on the project? Should the freelancer allow the client to use the freelancer’s existing works and ideas? These are just some of the possible scenarios the contractor should consider under this part of the contract for service template.
Whether you are a client about to engage the services of a contractor, or you are the latter about to embark on a project, you are strongly encouraged to make sure that all details are clear and documented in the contract for service template. You don’t want to find yourself embroiled in an unpleasant working situation later in the project.