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I've recently been approached to do some development work for a start up.

The fellow has requested my terms and conditions.

Being new to the industry, what sort of information would/should I include in this?

Obviously pay rate and maybe information about ownership of Intellectual Property perhaps.

Is there anything I'm missing?

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Consider consulting a lawyer, or at least read a good book or several on consulting contracts. There are lots of details to screw up unless you know about them. – hotpaw2 Aug 26 '11 at 1:22
I'm 21 :( I know no lawyers haha. I guess I better get googling – MattyD Aug 26 '11 at 1:30
Most lawyers also provide a free half hour or hour consultation afaik.. You could try out a few 'n see what they have to say. – Demian Brecht Aug 26 '11 at 1:45
You might check-out the Startups stackexchange site since this is related to starting your own biz. – Tom Jones Aug 26 '11 at 5:12
up vote 2 down vote accepted

Don't forget liability. Do what you can to prevent them from being able to sue you when it doesn't work, or when it turns out that you violated a patent on organizing source code using line breaks.

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Must Haves

Limited Liability

Lawyers and angry customers are not nice people and will not hesitate to sue your ass. Be sure to cover your rear end with a limited liability statement. The standard practice is that your liability cannot exceed the cost of services rendered so far.

Statement of Work

Don't say "I do the website" in your contract because it is too vauge and opens a can of worms for never-ending contracts. Use a specific, itemized list of things you will perform. List initial delivery dates; it's okay to group items into "phases".


Shaking hands to $50/hr or $2,000 for the job is not enough. You need to put it in writing. HR departments might also ask you to include a "maximum payment" that cannot be exceeded in case things run over. A good guideline for this is 10%.

Taxes, Benefits

If you haven't considered taxes yet, you're in for a big surprise. At any rate, you need to state who pays for things like taxes and benefits. If it's more of a temporary employee gig, then usually the company pays, if it's more of a contractor job, then you're responsible for it all.

Contract Dates

Dates are very important. Your contract needs to have an expiration date that says how long the offer is valid for. It should also have a definite cut-off date for maintenance and bugs.

Contact Information

Have both party's contact information available on the contract. Billing address, phone number, contact names, email addresses. This will help in resolving any legal issues that arise.

Should Haves

Bugs and Maintenance

This needs to be addressed. What constitutes a bug, and not a change or addition? How long will you continue to address bugs? What's the maximum amount of time before a bug gets resolved? You should think about testing practices while you're at it.

When and How You Are Paid

Whatever you don't include in your contract puts you at risk for a terrible slap in the face. Often, billing departments can run super slow. How slow? So slow that you receive your first paycheck a year after the project is over. Try to agree on methods of payment and payment dates.

Agree for Written Changes Only

This is more of a scope creep thing, but you should require that your client can only change the contract with a written agreement for new/changed work items (and a separate price tag).

TimeSheet: Anytime, Anywhere Policy

HR departments like to look at your timesheet every once in a while. It also shows if you are working and provides a layer of transparency that clients appreciate. Nowadays this is super easy, and even a GMail SpreadSheet will do the job.

Best Advice

Find a lawyer. Any old friend of a friend of a friend will do as long as they are trust worthy and attentive to your needs. If you're going to be doing this contracting business often, consider becoming a LLC or being employed/under one. It will help with legal issues immensely.

And, remember your taxes! You will get fined if you don't.

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Thanks for the post. But to clarify I will be working with one person at the start and he will be bringing in other people to complete certain phases – MattyD Aug 27 '11 at 0:16
Be sure to include statements about who is responsible for what. More people means more possible points of failure. If you're a programmer and your 3d artist goes MIA, you don't want to get caught in the crossfire. – rlb.usa Aug 27 '11 at 0:21
In fact, since this is a medium sized project/contract, I would definitely recommend skipping all answers you may get to this question and going straight to a lawyer instead. – rlb.usa Aug 27 '11 at 0:22
I think that sounds like the best idea. Better call Saul – MattyD Aug 27 '11 at 0:28

I would determine maintenance up-front: Are you expected to maintain the code once you've completed your tasks? Along with that, cost of maintenance (i.e., if you're charging a lump sum for the project and would be charging hourly for maintenance).

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I would probably be doing lump sum split up over seperate milestones, say 25% first then so on... – MattyD Aug 26 '11 at 1:29
@MattyD - If you do that place a timeline on how long they have to accept a given milestone. Otherwise they could in theory next accept the next milestone. This would lead you say 50% into a project, and in an effort to complete the milestone, they slowly make the milestone into something they could actually use. You also would need to determine how it would be delevered. – Ramhound Aug 26 '11 at 14:57

Considering your comment (being 21), you should make it clear that you'll bill by hours worked, with a "best effort" commitment only. You simply won't have the experience to make a proper "fixed cost" offer. The "Consultancy for Dummies" book (or similar titles) are sufficient for such simple contracts. You're just selling hours worked, so it's similar to being a gardener. You don't need to address special software-specific considerations.

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