Quick take: When you work as a freelancer, the contract determines your rights, your liabilities, and your ability to work for other clients. Many freelancers sign contracts drafted by the client's legal team without understanding the implications. Your contract is essentially your only protection.

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Why It Matters More for Freelancers

Unlike employees, freelancers do not benefit from statutory employment rights: no unfair dismissal protection, no redundancy pay, no employer pension contributions. If your contract is poorly drafted or heavily weighted in the client's favour, you have limited recourse.

1. Intellectual Property Clauses

Many client contracts include a blanket assignment of all IP created during the engagement. For a developer, designer, or writer, this can mean losing ownership of work that forms part of your portfolio or reusable code libraries.

A freelance developer in Birmingham signed a contract that assigned "all intellectual property created in connection with the services" to the client. She later discovered this included a component library she had developed over several years and used across multiple projects. The contract language was broad. The client claimed ownership of the entire library.

Check whether the IP assignment is limited to work created specifically for that client, or whether it extends to pre-existing tools and templates.

2. Unlimited Liability

Some contracts do not cap the freelancer's liability for errors, delays, or breaches. Without a cap, you could in theory be liable for the client's total losses, which might far exceed your fee. Standard practice is to cap liability at the total fees paid under the contract.

3. Restrictive Covenants

Non-compete and non-solicitation clauses are increasingly common. A 12-month non-compete preventing you from working for the client's competitors could significantly limit your income, particularly in niche industries. Courts will scrutinise reasonableness, but challenging them requires legal action, which is expensive and uncertain.

4. Payment Terms

Check when you get paid, what triggers payment, and what happens if the client does not pay:

• "Net 60" terms mean payment within 60 days of invoice--a real cashflow problem for freelancers

• Conditional payment clauses that tie payment to client "approval" can delay payment indefinitely

• Late payment interest: The Late Payment of Commercial Debts (Interest) Act 1998 gives you the right to charge 8% above base rate on late payments. Check whether your contract tries to exclude this

5. Termination Provisions

Check how much notice the client must give. If you have turned down other work to commit to a project, a clause allowing the client to terminate with one week's notice leaves you exposed. Negotiate for a notice period that reflects your commitment.

FAQ

Should I have my own standard terms?

Yes. Having your own terms gives you a starting point for negotiation and ensures basic protections (IP ownership of pre-existing work, liability caps, payment terms) are in place. Many freelancer associations and professional bodies provide template terms as a starting point.

How much does a contract review cost?

A solicitor specialising in commercial or freelancer contracts typically charges 200 to 400 pounds for a review. AI screening tools can help identify unusual clauses quickly for less, though they do not replace professional advice on enforceability.

Disclaimer: This article is general information, not financial, tax, or legal advice.