What is a Consultancy Agreement and what should be included in it?


A Consultancy Agreement is a document that outlines how any potential or current work undertaken on a consultancy basis should be conducted between the relevant parties. As a result, it needs a specific set of clauses to ensure that both sides have their legal interests met. Our Consultancy Agreement template includes the following as standard: 

  • Scope of agreement - this clause outlines briefly what tasks the consultant should perform for the company. That task can be more extensively described in an appendix. Here is also the opportunity to state whether the consultant is self employed or a freelancer and therefore not an employee of the company. 
  • Duties - The manner in which the consultant performs the task is approached here. That means it directly states that the consultant shall act professionally and if any delays are to be expected, to inform the company as soon as possible. Additionally, the company has to provide the consultancy with all reasonable information to perform the task.
  • Payment - How much the consultant charges the company, exclusive of tax, needs to be stated in this clause. However, when that fee is to be paid, and whether it should be paid in installments is also stipulated. Additionally, how expenses or any further work is paid for is explored here. 
  • Intellectual property rights - Any intellectual property that is created during the process of completing the task remains the property of the company. When the consultant finishes the task, the consultant must transfer that property immediately. 
  • Duration - When the agreement comes into force is stated here, but also what notice period the company must give the consultant should they want to terminate the agreement. Additionally, the agreement states how termination can arise if there has been a breach of contract.
  • Limitation of liability - Liability is limited to the final fee. However, that does not apply to liability and damages that occur if there is an infringement of intellectual property rights or gross misconduct. No party is responsible if the other party incurs an indirect loss or damage that occurs due to the agreement. 
  • Confidentiality - How the consultant must approach confidential information regarding the company is approached here as it cannot be disclosed to third parties for any other purpose than to help achieve the task, and prior written consent must be given too. 
  • Other terms - any final terms not explored in the rest of the agreement are stated here. For example, the consultant must perform the task and not let the task be performed by others without prior written consent. Additionally, what the overriding governing law is identified.

When should I use a Consultancy Agreement?

You should use a Consultancy agreement when you are either performing consulting work for a firm, or employing a consultant to access their area of expertise - without asking them to become a full time employee. For example, you may want a construction Consultancy Agreement or you may find that you want a financial or leadership consultant to help areas of your business where you believe that a consultant’s outside knowledge would be a good investment to help drive your business forward. 

Why should I use a Consultancy Agreement?

Using a Consultancy Agreement is crucial as it helps identify the responsibilities of both parties involved in the relationship. In doing so, you help strengthen that relationship and additionally help improve the results from that relationship. By having a solid agreement from which to work, both parties know what is required from them from the start of the contract. There is no room for confusion which makes it far less likely that there will be any legal dispute or breach of contract in future. 

Where and how should I use a Consultancy Agreement template?

If you have ever been overwhelmed or intimidated by the amount of work that goes into creating a contract, that is where you should use our Consultancy Agreement. Drawing up contracts and agreements from scratch, each and every time you need one, is time consuming if you do not have technology there to help you. 

So, what’s great about our app, our software and our templates, is that it can extract data from an individual Consultancy Agreement letter, meaning that drawing up a Consultancy Agreement or even a Consulting Agreement is a quick and painless process. And, if either of these are not quite suitable, we have also drafted a ‘light’ version of our Consultancy Agreement which may be better for your own individual needs and circumstances. 

Our platform can therefore be used by you to help harness the information you already have saved on your systems, and exponentially improve the pace at which that data can be input into a contract. That contract can then be negotiated and collaborated on with our app by all parties and, ultimately, is an accurate and reliable document when finalized. Our platform can then allow all users to store it securely in cloud based storage that means it is accessible to all, should it be needed in the future.

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