Consultancy Agreement, you may not be an expert in every field you come across. For instance, if you have a software company, you may not be an expert in advertising and using skills to increase the demand for the software developed by you, but hiring a specialist would make your job easier. A consultant is hired by the company for a specific task for which they have no expertise and sufficient knowledge, but the consultant performs such work efficiently.
A consultant is a professional who is hired on the basis of their experience of a subject matter. A consultant gains experience by performing similar tasks by engaging with other companies over a certain period of time. A consultant cannot be referred to as an employee in your company.
A consultancy agreement defines the relationship between the consultant and the client which is entered when a consultant is asked to provide expert services to a client. When hiring a consultant, you must enter into a consultancy agreement with him/her to avoid any misunderstanding that may have arisen during an oral agreement.
Consultancy Agreement Format (Sample)
Consultancy Agreement Template
Download Above Consultancy Agreement pdf
The Advantages of Entering into a Consultancy Agreement
1.Clear expectations are set out.
A consultancy agreement lists the responsibilities and duties of the consultant. Therefore, the parties are clear about their roles and responsibilities. The agreement clearly sets out the reason why the consultant is hired and the duration for which the consultant has been hired for.
2. It avoids miscommunication
The party’s consent to all the terms and conditions of the agreement and agree to sign, thereby executing the agreement. There are fewer chances of unwritten terms which may be missed out in the written agreement. No party can make unneeded demands that are outside the scope of the agreement and were not mutually agreed upon by both parties.
3.Timeline for the Consultant
A consultancy agreement sets out the duration as to when the consultant must complete the work allotted to him/her. This also includes the deadlines within which the consultant must complete the different tasks allotted to him/her.
4.It sets out the payment details
The agreement sets out the payment details on the revenue which the consultant will be entitled to, whether it is on a monthly basis or based on the completion of the allotted project. The method of payment is clearly defined in the agreement, and there are rare chances of either party making any changes in the mode of payment once the agreement has been executed.
5.An agreement is legally binding between the parties
Since the agreement acts as a legal document, it is enforceable by law and can be produced before the court if there arises any dispute. The risk of committing any breach by either of the parties is low, and if such a breach is committed, then the opposite party can take legal action against the breach.
If there is any loss incurred by the other party to the other due to its negligence, then the affected party can be compensated to recover the loss incurred.
How does it benefit the consultant?
A consultant is protected on payment terms once the project has been completed by him/her. There may be an event where the client refuses to pay on the ground that the work completed by the consultant is not up to the mark as aspected by the client, even though the consultant has completed the allotted task within the given duration. Getting into a consultant agreement saves the consultant from such an unanticipated situation by receiving the payments on time for the efforts and time put up. Hence, the payment, mode of payment, and the resources to which the consultant will be entitled must be included in the agreement and mutually agreed by the parties.
How Does It Benefit the Client or Company?
When you look to hire a consultant, you must present a well written consultant agreement by an expert to the consultant. A good consultant may refuse the project proposed by you on the ground that you have not provided a well-written agreement which sets out the details of the project, responsibilities, role and the fee to which the consultant will be entitled.
By having a consultant agreement, you protect yourself against any risk that may arise as a result of the consultant’s failure to complete the project, and he may be held liable to the client for any loss which occurred as a result of the consultant’s irresponsibility. Therefore, reaching your set goal and target becomes much easier than without a written agreement.
Drafting Consultancy Agreement
GET YOUR CONSULTANCY AGREEMENT DRAFTED BY A LEGAL EXPERT
Using a normal template which you may come across online is not the right template to proceed with. Such templates do not necessarily involve all the essential clauses which must be present since all the clauses in the agreement must be drafted keeping in consideration the role of the consultant and an outline of the project must be listed along with the rights which the parties are entitled to legally. Hence, it is better legally to approach a contract/corporate lawyer who would look into every necessary aspect before drafting a consultancy agreement. We at VSK & CO LEGAL ADVOCATES AND CONSULTANTS draught commercial, corporate, and IPR agreements from scratch to make sure that you do not face any legal consequences later.