Agreement Date and Parties
The date of this Agreement is [Day] of [Month], 20[Year] (the "Signing Date")
This is an agreement between:
- [Company Name] with its registered office at [Registered Office Address] ("Client" in this Agreement); and
- [Individual Name] of [Address] ("Consultant" in this Agreement).
- 2.1 The Client engages the Consultant to provide the services described in the Schedule in accordance with this Agreement ("Services" in this Agreement).
- 2.2 This Agreement will continue for the Term. The Term starts on the Signing Date (at the beginning of this Agreement) and will continue until it ends as set out in the Schedule, unless ended earlier under clause 10.
- 3.1 During the Agreement, the Consultant will:
- 3.1.1 provide the Services carefully and skilfully as best he/she can and in a first class professional way;
- 3.1.2 meet the Client's reasonable expectations by providing the Services during the professional hours of the Client for the minimum period as agreed with the Client and set out in the Schedule;
- 3.1.3 reply as soon as possible to any reasonable request from the Client's board of directors for information and reports in connection with the Services;
- 3.1.4 tell the Client as soon as he/she reasonably can if the Consultant is unable to provide the Services or complete any part the Services for any reason;
- 3.1.5 try to ensure that he/she is available at all reasonable times (as long as the Consultant is given reasonable notice in advance) to provide any assistance or information the Client in relation to the Services;
- 3.1.6 not incur any expense on the Client's behalf, or give the impression he/she is allowed to do so, unless the Client specifically tells him/her to do so in writing;
- 3.1.7 comply with all reasonable standards of safety and with the Client's written health and safety procedures, at the place where the Services are provided, and report any unsafe working conditions or practices to the Client;
- 3.1.8 comply with all applicable laws about anti-bribery and anti-corruption including the piece of legislation known as the Bribery Act 2010, and also with any of the Client's ethics policies or data protection policies that he/she is made aware of; and
- 3.1.9 make sure that all his/her work is original and does not infringe anybody else's rights and nothing he/she does will be unlawful or infringe anybody else's rights of data or privacy, or be obscene, or damage anybody's reputation in a way that the law judges to be defamatory.
- 3.2 The Consultant is a professional who will use his/her own initiative as to the way in which the Services are delivered provided that in doing so the Consultant shall co-operate with the Client and comply with all reasonable and lawful requests of the Client. Any training that the Consultant requires shall be paid for by it.
- 3.3 The Consultant may provide the Services from such locations as are appropriate and agreed with the Client.
- 3.4 The Consultant shall not be required to provide any advice and assistance in addition to the Services other than as set out in this Agreement. Any requests to provide any additional advice and assistance shall be agreed by the Consultant before the advice or assistance is provided, including the fee payable for such additional advice and assistance. The details of any new fee arrangements between the Consultant and Client shall be agreed in writing and the Schedule shall be amended to show that agreement.
- 3.5 The Client will collect and process data about the Consultant in accordance with the privacy notice provided to the Consultant or which is available on [Insert details of where the privacy notice will be available to consultants, e.g. on the intranet].
- 3.6 The Consultant will comply with the Client’s data protection policy and any other policies that apply to the processing of data, including in relation to criminal records information, internet, email and communications, information security and bringing the Consultant’s own device.
- 3.7 In addition to the general obligations of the Consultant under clause 3.6, the Consultant will:
- 3.7.1 co-operate fully with the Client to allow the Client to comply with all of its obligations under applicable data protection legislation;
- 3.7.2 implement and maintain appropriate technical and organisational measures against unauthorised and unlawful processing of personal data (in each case as defined in applicable data protection legislation) and against accidental loss and destruction of or damage to personal data;
- 3.7.3 process any personal data disclosed to the Consultant by or on behalf of the Client only:
- (a) for the purposes of providing the Services; and
- (b) for the purposes for which that personal data was obtained and is processed by the Client;
- 3.7.4 provide evidence straightaway of the Consultant’s compliance with his/her obligations under clause 3.6 and 3.7 as the Client may from time to time reasonably request;
- 3.7.5 straightaway on receiving notice from the Client, take all appropriate action to enable the Client to comply properly with any request from a data subject in relation to access to and/or rectification or erasure of personal data; and
- 3.7.6 immediately notify the Client of any data breach relating to personal data about which the Consultant become aware.
Louise Paull is an experienced employment lawyer providing clients with commercial, practical advice on a full range of employment-related matters.
She advises on contentious and non-contentious matters working with employers on the legal issues arising in relation to the recruitment, day-to-day employment and dismissal of staff, including drafting contracts of employment, staff handbooks and policies, cultural and family-friendly issues, equal opportunities, diversity and discrimination matters, sensitive issues around the termination of employment, including disciplinary, conduct and capability issues, negotiating severance packages and settlement agreements, collective and individual redundancies, unfair dismissal, breach of contract, business transfers and TUPE issues.
Louise qualified in 1999 with City firm King and Wood Mallesons SJ Berwin as an employment associate and most recently worked for Berwin Leighton Paisner in its employment team. She spent time on secondment with IMG, a major international sport and artist management business, as its sole in-house employment lawyer, and has worked for BT in its in-house legal team.
Step By Step Guide
Let’s walk you through how to go about drafting a Consultancy Agreement, something you need if you’re going to be providing services to a client or the consultant is providing services to you, and in each case the relationship is not one of employment. This consultancy agreement is to be used if the consultant is contracting directly with the client. If the consultant is providing their services through a limited company, you should use the consultancy agreement for a consultant operating through a limited company.
This agreement works no matter whether you are the client or the consultant.
1. The main difference between an employment agreement and a consulting agreement is that in an employment agreement the employee is under the control and supervision of the employer on a day to day basis, and often work only for the client, whether that is for five days a week or less. Consultants have the freedom to decide how to provide the services that they are engaged to provide. They can work for more than one client at a time and the client does not have to provide them with work at the end of a project. It can be a bit tricky to get the distinction right, and there are legal consequences if you get it wrong (e.g. you might have to pay a fine and national insurance for your consultant retrospectively if he is really an employee).
2. Once you know you have the right document, the first thing you’ll need to decide on is the term - how long will the agreement last – a month, a year, three years?…
3. Then it’s onto the consultant’s responsibilities - what is expected of the consultant during the term? The more clarity there is the less room for argument later…
4. It’s important to include something about payment. Here, include the necessary information about the consultant’s fees. How much do they get? Are they paid monthly? At the end of that month? Or in advance? Do they just get a fixed sum or is there some other benefit (for example, a share of revenue they create)?…
5. What you will also need is a section for expenses; this outlines what the consultant can claim back, and how – for example, reasonable costs they spend on the business which the client has previously approved…
6. Then, agree on what work the consultant can or cannot do elsewhere during the term. They normally have some freedom but it may be that it is agreed that for example they won’t work for a direct competitor during the Term.
7. You should also detail what information will be confidential; the agreement doesn’t make much sense if the consultant is allowed to share the client’s information with other businesses…
8. Intellectual property involves clarifying things like who owns the consultant’s ideas during the course of the term and who owns any copyrights he creates…
9. Outline how, and under what circumstances, the agreement can be terminated – for example if the Consultant breaches the agreement or the client goes bust…
10. Then include a bit about the status of the relationship between the client and the consultant. Why? Because if the client does not employ the consultant, then the client is not responsible for the payment of the consultant’s taxes, and the consultant must do this himself…
11. You still need to say what would happen in the event of a dispute. Do you go to court or is there a process like mediation set up where a qualified mediator helps everyone to sort out their differences? This is normally a much cheaper and quicker route, and the good news is that you can do it all through LawBite!
12. And as if that was not enough good news, at the end you get the option to try out fantastic e-signing feature at no extra charge and close the agreement in minutes…
Remember, if you come unstuck at any point, our LawBriefs are here to help. Visit our legal advice page to submit an online enquiry or call us on 020 7148 1066.
Best of luck in your SME journey.
When To Use this document:
This is agreement is used where a consultant is providing his or her consultancy services to a client, and those services are to be provided by the consultant directly in his/her own name, rather than through a limited company. Where the consultant is engaging with the client through a limited company, you should use the Consultancy Agreement (Limited Company). The agreement can be used either by the consultant or by the person engaging the consultant's services. See our Step by Step walkthrough for full guidance notes to help you complete this document on your own.