# Contract clause library 12 clauses that stop the three money leaks: undercharging, unpaid extra work, and late payment. Each has the clause text, what it means in plain English, and what to watch out for. > **Not legal advice.** These are starting-point templates written in plain English. Contract law differs by country and state (for example, late-fee limits and consumer-protection rules). Have a local lawyer review your final contract once. It usually costs less than one unpaid invoice. Last verified: October 2026. **How to use:** Paste the clauses you need into your proposal or contract. Replace every [BRACKET]. Keep the numbering consistent with your document. If you work with consumers (individuals, not businesses), extra rules usually apply, so get local advice. --- ## 1. Payment terms > **1.1 Fees.** The Client will pay the fees set out in the Proposal ("Fees"). All Fees are in [CURRENCY] and exclude [VAT / sales tax], which will be added where applicable. > **1.2 Invoices.** The Freelancer will invoice according to the payment schedule in the Proposal. Each invoice is due within [14] days of the invoice date. > **1.3 Method.** Payment is made by [bank transfer / card via PAYMENT LINK]. Transfer and currency conversion fees are paid by the Client. > **1.4 No set-off.** The Client will pay invoices in full and won't deduct amounts for unrelated disputes. **Plain English:** How much, in what currency, when, and how. "Due within 14 days" beats "Net 30" for small businesses. Shorter terms mean less waiting and fewer forgotten invoices. **Watch out:** Big companies often send their own vendor terms (60–90 days). Negotiate *before* you sign, or price the delay in. Some freelancer laws (e.g. New York, California, Illinois) set a default of 30 days after completion when no date is agreed. Check yours. --- ## 2. Deposit > **2.1** Work begins after the Client has signed this Agreement and paid a non-refundable deposit of [40–50]% of the total Fees ("Deposit"). > **2.2** The Deposit reserves the Freelancer's time in the schedule and covers initial planning work. Project dates in the Proposal begin from the date the Deposit is received. > **2.3** If the Client cancels before work starts, the Deposit is retained [except as required by applicable law]. **Plain English:** No deposit, no start date. The deposit filters out clients who aren't serious and means you're never fully unpaid. **Watch out:** "Non-refundable" isn't enforceable everywhere in every situation, especially with consumers. The fair framing ("reserves your time, covers planning") helps if it's ever challenged. 30–50% is common. Under $2,000, 50% is normal. --- ## 3. Scope & exclusions > **3.1** The services and deliverables are only those listed in the Proposal under "Scope" ("Services"). > **3.2** The following are **not included** unless added by a Change Order: [e.g. copywriting, stock image licenses, social media assets, hosting, ongoing maintenance, additional pages, translations, paid tool subscriptions]. > **3.3** The Client is responsible for providing [content, logins, brand assets, feedback] by the dates in the Proposal. **Plain English:** The exclusions list is the most underrated line in freelancing. A request that matches it is out of scope, with no debate. **Watch out:** Write exclusions for the things clients *usually* assume are included in your niche. Scope Guard (`skills/scope-guard`) cites this clause more than any other. --- ## 4. Revisions > **4.1** Fees include [2] rounds of revisions per deliverable. A "round" means one consolidated list of feedback from the Client, delivered in writing in a single message. > **4.2** Revisions refine the approved direction. A change of direction after approval (new concept, new style, new brief) is new work and will be quoted as a Change Order. > **4.3** Additional rounds are billed at [RATE]/hour (minimum [1] hour) or a fixed [AMOUNT] per round. > **4.4** Feedback is due within [5] business days of each delivery. If no feedback is received within [10] business days, the deliverable is considered approved. **Plain English:** Defines what a revision is (one consolidated list, not 14 Slack messages), what it isn't (a new direction), and what happens if the client goes quiet. **Watch out:** "Deemed approval" clauses (4.4) keep projects from stalling forever. Remind the client of the date in your delivery email. Some courts are skeptical of deemed approval, but the reminder alone fixes most stalls. --- ## 5. Change orders > **5.1** Any request outside the Services is a "Change". The Freelancer will reply with a written Change Order describing the work, price and timeline impact. > **5.2** Changes are only carried out after the Client approves the Change Order in writing (email is enough). > **5.3** Change Orders are invoiced [100% on approval / with the next milestone invoice]. Minimum Change Order fee: [AMOUNT]. > **5.4** Approved Changes may move the delivery date. The Freelancer will state the new date in the Change Order. **Plain English:** Extra work has a process: you write it up, they say yes in writing, then you do it. No "we'll sort it out at the end." **Watch out:** A minimum fee (e.g. $150) stops the "it's just 5 minutes" requests from adding up. Use the change order template in `skills/scope-guard/SKILL.md`. --- ## 6. Kill fee (cancellation) > **6.1** The Client may cancel the project at any time by written notice. > **6.2** On cancellation, the Client will pay: (a) all fees for work completed up to the cancellation date, calculated at [RATE]/hour or by completed milestones, whichever is greater; plus (b) a cancellation fee of [25]% of the remaining unpaid Fees, to cover reserved time that can't be rebooked at short notice. > **6.3** The Deposit counts toward these amounts. Ownership of completed work transfers only once these amounts are paid in full. **Plain English:** If they cancel halfway, you get paid for what you did plus part of the time you blocked for them. **Watch out:** Keep the cancellation percentage reasonable (often 10–50% of the remainder in practice). Fees that look like a penalty can be unenforceable in some places. Linking it to the time you blocked is the fair reason. --- ## 7. IP transfer on full payment > **7.1** On receipt of full payment of all Fees, the Freelancer assigns to the Client all rights in the final deliverables listed in the Proposal. > **7.2** Until full payment, all rights in the deliverables remain with the Freelancer, and the Client has no license to use them [except for internal review]. > **7.3** The Freelancer keeps ownership of pre-existing materials, tools, code libraries, templates, and unused concepts/drafts. The Client receives a non-exclusive, perpetual license to use any of these that are built into the final deliverables. > **7.4** Third-party assets (fonts, stock, plugins, APIs) are subject to their own licenses, which the Client must purchase or maintain where required. **Plain English:** They own it when they've paid for it. Before then it's yours. Your reusable tools and rejected drafts stay yours forever. **Watch out:** This is your strongest legitimate lever on a late payer. But don't use it as a reason to sabotage live work (see Step 4 of the late payment sequence). In some countries, certain rights (like moral rights) can't be fully assigned, and copyright transfers may need specific wording. Ask a local lawyer once. --- ## 8. Late payment: fees and interest > **8.1** Invoices not paid by the due date are overdue. The Freelancer may charge [a late fee of [AMOUNT] / interest at [X]% per month / the statutory rate under applicable law] on overdue amounts from the due date until paid[, not exceeding the maximum rate permitted by law]. > **8.2** The Client will also pay reasonable costs of recovering overdue amounts, including [collection agency fees and legal costs], where permitted by law. > **8.3** Where applicable law gives the Freelancer additional rights to interest or fixed compensation (for example, under late-payment legislation for business-to-business transactions), those rights apply in addition to this clause. **Plain English:** Late costs money. The number itself matters less than having a clause at all, because it turns your Step 5 email from a request into a reference. **Watch out:** Many US states cap interest rates, so keep it modest and add "not exceeding the maximum permitted by law". In the UK and EU, B2B statutory interest and fixed compensation exist even without a clause (see `late-payment-sequence.md`), but a clause still helps. --- ## 9. Pause for non-payment > **9.1** If any invoice is more than [14] days overdue, the Freelancer may pause all work on written notice until all overdue amounts are paid. > **9.2** Delivery dates move by the length of the pause plus the time needed to reschedule, up to [10] business days. > **9.3** Pausing work isn't a breach of this Agreement by the Freelancer. **Plain English:** You're allowed to stop working for someone who stopped paying, and the deadline moves with you. **Watch out:** It covers pausing *work*, not switching off live services. If you host or manage anything live, add a separate clause with a notice period. --- ## 10. Termination > **10.1** Either party may terminate this Agreement by [14] days' written notice. > **10.2** Either party may terminate immediately by written notice if the other materially breaches this Agreement and doesn't fix the breach within [7] days of being notified. Non-payment of an invoice more than [30] days overdue is a material breach. > **10.3** On termination, the Client pays for all work completed up to the termination date (and any kill fee under clause 6, if the Client terminates without cause). Clauses 7, 8 and 11 survive termination. **Plain English:** Either of you can walk away fairly. If the client stops paying, you can end it, and you still get paid for work done. **Watch out:** Match the notice period to your project length. On retainers, 30 days' notice is common. --- ## 11. Limitation of liability > **11.1** The Freelancer's total liability under this Agreement is limited to the Fees paid by the Client in the [12] months before the claim. > **11.2** Neither party is liable for indirect or consequential losses, including lost profits or lost data, [except where such limitation is not permitted by law]. **Plain English:** If something goes wrong, the most you can owe is what they paid you, not their lost revenue. **Watch out:** Especially important for developers and AI automation freelancers whose work touches client data or revenue. Some liability can't be limited by law (e.g. fraud or, in some places, personal injury), hence the bracketed carve-out. --- ## 12. AI tools & portfolio rights > **12.1** The Freelancer may use software tools, including AI-assisted tools, to deliver the Services. The Freelancer remains responsible for the quality of the deliverables and will not input the Client's confidential information into tools that use it to train public models[, unless the Client agrees in writing]. > **12.2** Unless the Client opts out in writing, the Freelancer may show the deliverables in their portfolio and mention the Client's name after public launch. Confidential information is never shown. **Plain English:** You can use AI, you're still accountable, and you protect their data. And you can show the work once it's public. **Watch out:** Some clients (enterprise, health, finance) will want stricter data rules. That's fine; agree them up front. Note that copyright protection for purely AI-generated material is limited or uncertain in several countries, so be careful promising "full ownership" of raw AI output. --- ### One-paragraph "mini-contract" for small jobs (under ~$1,000) When a full contract feels too heavy, send this as an email and ask the client to reply "Agreed": > Confirming the project: [DELIVERABLES] for [PRICE] [CURRENCY]. Includes [2] revision rounds (one consolidated feedback list each). Not included: [EXCLUSIONS]. Timeline: [N] working days from deposit. Payment: [50]% upfront, [50]% before final files. Invoices due in [7] days; work pauses if an invoice is 14+ days overdue. Extra requests get a quick written quote before I start them. Files and rights transfer to you on full payment. Reply "Agreed" and I'll send the deposit invoice. Some freelancer laws require specific contract contents above a threshold (e.g. New York $800+, California $250+ for certain services, Illinois $500+). Above those amounts, use a full written contract that meets your local requirements. --- **Made by Dan Shipped — @danshipped.** Templates only, not legal advice. Check your local rules.