Tips for drawing up a good assignment contract
As a self-employed person, you often work with a commission contract: a contract in which you and your client lay down the agreements on the work you will perform, the rates, the duration and other relevant provisions. This agreement is required by law to provide clarity and is a means of protecting yourself.
Nevertheless, many self-employed people are reluctant to draw up such a document. Therefore, we give you some practical tips and examples so that you can confidently draw up a commission contract that suits your assignment.
What is a commission contract?
A commission contract is a legally binding document that you, as a self-employed person, conclude with your client. In it, you lay down what services you provide, within what period and at what rate. Unlike an employment contract, you are not an employee and therefore have more freedom to organise your work independently. At the same time, the client is not obliged to continue paying you wages in case of illness or holidays.
Important: a commission contract must explicitly state that you are self-employed. You must be able to determine your own working methods and there should be no relationship of authority as with an employee. In other words, you must be able to make your own decisions and not be supervised by the client via fixed working hours.
Why is a good assignment contract important?
Above all, it provides a lot of clarity. When all agreements are in black and white, you avoid misunderstandings and discussions. You also prevent your client from secretly requiring you to participate as an employee. It also establishes that you work at your own risk and are not subject to their payroll taxes.
And of course, it can be important for the Tax Office. Should a dispute ever arise about your self-employment, a clear assignment agreement can help prove that you are not an employee.
Important elements of the agreement
Put your full company name and details in the agreement, and ask the same of your client. Also include your Chamber of Commerce number and VAT ID, so there is no ambiguity about your status as an entrepreneur. Also, always describe exactly what you will do, how you will do it and what deliverables you will provide. Do you want to remain flexible? Then you can describe a broad outline, with room to specify it later in an assignment description.
Lay down whether you will use an hourly rate, a fixed project price or some form of no-cure-no-pay. Also be clear about invoicing: when will you send your invoice, how much payment period is there and what happens in case of late payment?
Is it a one-off job?
Include the duration and notice. Is this a one-off assignment or will the collaboration last several months? Can you cancel in the interim, and if so, on what terms?
And do you work in a creative sector? Then you will want to arrange who has the rights to the end result (e.g. photos or texts). By default, these rights often lie with the creator, unless you agree otherwise.
Also, always record what damages you are liable for and up to what amount. Consider professional liability insurance, especially if you provide high-risk services.
Tips to avoid false self-employment
As a self-employed person, you want to avoid actually being seen as an employee in the eyes of the tax authorities.
- Avoid compulsory attendance
The client should not dictate that you have to be at the office at fixed times. You determine your own working hours. - Work for multiple clients
If you only work for one client, you are more likely to be seen as an employee. Therefore, work for multiple clients or at least show that you are capable of doing so. - Use your own equipment. Where possible, provide your own tools, software or equipment. This emphasises that you are an independent professional.
Express in the commission contract that there is no employment relationship and that you perform your work independently, at your own risk and for your own account. You can read more about sham labour market constructions here.
Examples of clauses
Below are some examples of clauses you may find in a commission contract:
Assignment description
‘The Contractor will perform the following work for the duration of this agreement: designing a new website for the Client, including user-friendly navigation structure, responsive design and e-commerce functionality.’
Rate and payment schedule
‘The agreed hourly rate is € XX excluding VAT. The Contractor sends an invoice once a month for the actual hours worked. The payment term is 14 days from the invoice date.’
Freedom of execution
‘The Contractor shall perform the work independently and autonomously, without supervision or direction from the Client. The Contractor determines where and when the work is performed, subject to agreed deadlines.’
Intellectual property rights
‘Unless otherwise agreed in writing, all intellectual property rights to materials (designs, texts, software) developed by the Contractor shall remain vested in the Contractor.’
Liability
‘The Contractor shall not be liable for indirect damage, including consequential damage, loss of profit and damage due to business interruption. Direct damages are limited to a maximum of the amount of the agreed order price.’
What do you do if the client does not want to sign an agreement?
There are clients who prefer to work through e-mail agreements or make verbal commitments. They sometimes see a formal contract as extra hassle. Still, the lack of a written agreement can get you into trouble. For your own security, it is therefore smart to always send an assignment confirmation by e-mail, listing the most important points. Think about the work, the rate and the agreed deadline.
Reassure your client that an assignment contract does not have to be complicated or long. If you are able to draft the contract in simple and clear language, it is clear to everyone what the mutual expectations are. Bear in mind that a client who flatly refuses to put anything on paper may not be the most trustworthy partner.
Periodically check your standard contract
As a self-employed person, it is useful to have a standard assignment contract ready. Draft it with the help of legal advice and personalise it for each client. Be aware that legislation, case law and market practices can change. Therefore, review your standard contract at least once a year and adjust it where necessary. This can prevent you from being stuck with outdated provisions that are no longer legally valid or missing opportunities to strengthen your position.