Crucial programming-for-hire contract points?

Question

What are some important and easily-overlooked points that should be in a programming-for-hire contract?

We recently had a learning experience as a client hiring a programming company: in the contract we signed, there was no mention of billing practices such as

• Minimum billable unit. A 5 minute phone call was billed as 1 hour.
• Division of work. If two contractors at the company worked on something in the same day they had their hours billed and rounded up separately.
• What kinds of things were billable. We were billed for them to "install Visio" even though we'd asked them to use it on our VPN-accessible terminal server).

We prefer learning from other people's experiences rather than our own, thus hope to get the community's ideas about other important points we might be missing.

I am interested in both sides of the coin as I have been and will again be a contract programmer myself, even though at this time I'm thinking of it more for my company's hiring needs. So points important for both the client and the contractor are welcome.

Answer 1

One missing point that can be crucial (depending on relevance) is a definition and categorization of deliverables into those for which the client will be assigned copyright (corporate authorship or work for hire), and works that have an open source license (if, for instance, you use any open source libraries, you would not have the right to relicense or assign copyright of those libraries to the client).

Answer 2

You should definitely include terms that delineate who owns the intangible property such as designs, plans, solutions to problems.

I've started to write my own contracts, feel free to fork: https://github.com/danielbeardsley/service_contracts

Answer 3

As a contractor it's very important to describe the "done" phase. When you're not you could be spending months after you planned to be done fixing bugs or adding "features you forgot". Get a done definition and add a few weeks or months for bug fixing in your contract.