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Understanding the finer points of a contract is harder than you might think. Before you sign on the dotted line (or whatever today’s digital equivalent might be) it’s important that you know what you’re looking for, whether it’s a contract with an agency or directly with a client.

Not being fully aware of your contractual obligations, post-termination covenants and other clauses can lead to problems down the road. At best, this can lead to small misunderstandings, but the worst-case scenario can include legal action and huge compensation pay outs.

So, what should contractors look for in each and every contract? We’ve pulled together some key points to be aware of (although this is by no means an exhaustive list and each contract should be read thoroughly.)

Payment terms

This is a big one as it can vary from place to place. If you are dealing directly with your client, there will probably be clauses that state when you need to invoice by each week or each month in order to get paid. With an agency, there will be terms relating to the submission of timesheets and when you should do this by each week. Not taking heed of these contractual terms can result in you being paid late or not at all.

Termination covenants

These particularly apply to agency work, although they can also apply to creative freelancers working directly with clients if their clients include the likes of marketing or creative agencies. They often mean you are prohibited from working with agency clients for a fixed period after the termination of your contract. Not adhering to this can lead to accusations of poaching and even legal action.

Confidentiality and intellectual property clauses

Usually, contracts will have confidentiality clauses that ensure information about your client doesn’t leave the building. Be sure you understand these fully as you don’t want to find yourself in breach of contract by taking work home with you on a pen drive. Similarly, ensure you’ve read all intellectual property clauses. These will tell you who retains the IP for anything you work on while under contract.

Insurance obligations

Most contracts give explicit instructions as to the type and level of insurance a contractor should hold. At bare minimum, these are usually Public Liability, Professional Indemnity and Employers’ Liability, although if you work in a specialist field, there may be other types of insurance demanded by your contract. Breaching your contract by not having the correct insurance can result in legal action or the termination of your contract, so it’s important that you observe this to the letter.


Relating to insurance are the clauses referring to indemnity and liability. Make sure you understand this section of your contract thoroughly as you need to be certain you are happy with your potential liabilities should things go wrong. If you feel this part of the contract is unfairly weighted against you, it needs to be raised before signing.

If you are unsure of anything in your contract, you should get a solicitor to read over everything and explain. When it comes to insurance, though, Kingsbridge can help. Call us on 01242 808740.

Blog created by Kingsbridge Insurance 

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