Essentials for Establishing an Agreement with your Clients

It happens all the time.  Scan any freelance group or message board and you will find a post by a professional expressing regret of not executing a contract with a client.  Some form of disagreement transpired during the engagement with the payment for the services held as hostage. 

The following is a typical example:

“I recently had possibly one of the most frustrating and difficult clients, and he was someone I knew. Just an acquaintance, but I made the mistake of thinking I knew him enough to not require a contract.”

The fact the dispute was between two parties who were acquaintances is not an anomaly.  It should only reiterate the need for a contract or engagement letter with every single client.  Be proactive and avoid putting yourself into such a situation.

No exceptions

We all understand the value of a contract or an engagement letter and we recognize the potential risks by the absence of such an agreement.  Adopt a standard to require an agreement with every client.  NO EXCEPTIONS, PERIOD.

Beneficial for both parties

In the event, your prospective client queries the need for an agreement, advise them it establishes transparency for both parties related to the project or work.  Furthermore, it provides an opportunity to ensure the expectations are clearly outlined and, if not, can be addressed prior to the commencement of the project/work. 

The engagement letter is a very useful tool to help resolve a dispute as it evidences what was agreed by both parties. 

Lastly, view the process to execute an agreement as a risk management tool.  Finding the right clients is determined by your client selection criteria.  A client who refuses could represent a major red flag.

How to draft an engagement letter?

In a previous article, Managing Client Expectations through an Engagement Letter, we provide a simple sample format you can adopt as well as strategies when communicating the benefits of such an agreement to your client.  The article illustrates an example of how an agreement between two parties does not have to be complicated.  Another well-written engagement letter article is produced by Practice Ignition and provides even further details. 

What should an engagement letter contain?

The cited comment is reflective of most scenarios in the event of a dispute.  The frustration is based on a combination of a disagreement with the services provided, payment discrepancy and failure to conclude the project in a satisfactory manner.  It helps remind us that your agreement should pay particular attention to the following items:

  • Define the scope and limits of the services you will provide. Be as specific and detailed as possible.
  • Outline your compensation including the payment schedule and hand over of deliverables.
  • Set the duration of the engagement.


In some cases, it is difficult to accept jeopardizing an opportunity (and income) for insisting on an agreement.  However, the discipline could save you a lot of emotional distress and even loss making project.

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