What is a consultancy agreement?
What is a consultancy agreement?
A consultancy agreement allows two parties to engage in a business relationship where one side works as an external consultant. A consultant can be either an individual or a company. Consultancy services can vary, but often they provide advice that is seen to be expert and helpful. That is often due to their experience and also from their outside, objective viewpoint. A consultancy agreement will delineate what both sides want from the relationship regarding targets and payment on either side. It may also include a sub consultancy agreement whereby a consultant intends to subcontract out any of the services that they are providing.
How does a consultancy agreement work?
A consultancy agreement or a consultancy agreement letter works by setting out the circumstances and criteria that both parties need to adhere to throughout the business relationship. As a result, it will often specify what the consultant needs to have or do before working together.
That can mean the need for professional indemnity insurance and employer indemnity insurance. However, it will also need to layout the timeframe in which the consultant will be working with the company. Additionally, details on how much the consultant will be paid in that time are required. It may also detail any targets that need to be met and any other key objectives.
Consultants may also want to include how expenses will be paid and whether any authorization needs in advance of those expenses. Finally, it may need or require a termination clause in the event that either party wants to end the agreement. It is often also seen that the idea of intellectual property is also broached and how a consultant can then go on to work for competitors.
Advantages of a consultancy agreement
Given all the details often outlined in consultancy agreements, huge benefits and advantages can be taken from them. Firstly, it allows the professional business relationship even to begin. Secondly, and perhaps most importantly, what that business relationship will look like is also established.
A strong consultancy agreement will give a clear outline as to what is required from both parties, and therefore the results or products that transpire from the contract can be better and more swiftly achieved. Additionally, clauses about how to terminate the agreement or how or if a consultant can go on to work for competitors means there is less chance of a future legal dispute. Legal costs are therefore minimized as well as any time-consuming administrative burden that could arise from a legal claim being made by either party.
Contractbook and consultancy agreement
Contractbook can help those wishing to start working with a company on a consultancy basis. Our library of template contracts includes several consultancy agreements that mean establishing and agreeing to a contract is that much smoother a process.
Plus, our software means that collaboration is far easier, which has been shown to improve the quality of the final contract too. Using a consultancy agreement template from Contractbook or a consultancy agreement sample contract from us can consequently mean you can start working on a consultancy basis or with a consultant who can help bring about changes to your company far more quickly than without us.