Archive for March 11th, 2009

Dear Danielle: Whose Contract Should I Be Using (Mine or the Client’s)?

Dear Danielle:

I have obtained a new client and was about to send them my contract when they sent me their their independent contractor agreement! Do we use own agreement or the client’s? Help! –TS

Great question and I’m glad you’ve asked because there are a lot of different aspects here I’d like to discuss.

First to answer your main question… No, you do not sign a client’s contract. You aren’t hiring them; they are hiring you. Your business, your contract.

A contract is not only a legally binding document. It also serves to make sure everyone knows what the expectations and obligations both parties have to each other, as well as what happens when those agreements are not kept. For example, late or non-payment on the part of the client may result in immediate work stoppage.

Your written contract also helps everyone remember what they’ve agreed to. People tend to “forget” things when it’s convenient or self-serving. A written contract helps keep everyone honest and their “memory” intact.

Your question also brings up the red flag that this client may not understand the nature of your relationship. The term “independent contractor” is responsible for this continuing misunderstanding.

(By the way, I’ve put that term on my X list and no longer use it in any way, shape or form when I’m educating people about the administrative support industry.)

There are only two classifications in this world (at least in the U.S. and those countries with similar laws). You’re either a business or you’re an employee. There is no third classification. Independent contractor is just another word for business owner.

And a business is a business, regardless of whether you’re a big corporation or a self-employed solopreneur.

So it’s going to be really important for you to have a conversation with this client and make sure they understand that they aren’t hiring an employee or telecommuter.

As a business, it’s your place to provide the contacts. It’s you who has more at stake in the relationship if things don’t go well.

You have much more liability involved and interests that need to be protected. So your business, your contract.

This is how business is conducted. It’s standard operating procedure. Stand firm and don’t be afraid to educate them about this if they don’t (they need it). Make sure they understand they understand that this is a business-to-business relationship. They aren’t hiring an employee so it’s not their place to provide the contract.

If they don’t like it, they can go elsewhere. No loss. You will have dodged a bullet, trust me. You’ll regret working with any client who doesn’t get these things.