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Avoid disputes at all costs: Consider your contract


Sometimes it’s the little things in life that make all the difference… like a contract.

When you take on work as a contractor, it’s important to ensure you have a contract in place. This might feel awkward if the person engaging your services is a long-term friend or family member, but believe me, in the event of a dispute, you’ll be much-better placed to sort it out amicably.

Consider this example. Charley’s elderly uncle had contracted him to paint the outside of his house over a period of four weeks. On week three, he was three quarters of the way through when the uncle decided he wasn’t happy with the colour they’d agreed to use for the trims. He asked Charley to go back over the trims in a new colour.

When Charley was unable to complete the house within the agreed four weeks, he explained to his uncle that having spent three days re-painting the trims, it would take an additional three days to finish the job… this would come at an increased cost.

Charley had made a verbal contract with his uncle and there was no written confirmation of the agreement. Charley felt unable to force the point and ended up working the extra three days at no cost, just so that he would be paid the originally agreed price and the family relationship would be maintained.

The Importance of Communication

Sometimes even with a contract in place, problems can occur. Many can be avoided with clear communication.

Consider this example. Pauline agrees to work from home for a company on Monday, Wednesday and Thursday each week. A major project comes up with a tight deadline so she decides that to help out, she’ll work full time over one week just to get the job done. Assuming they will recognise her extra work, she doesn’t mention it to the employing company. The work is completed and the following week, she announces she will take time in-lieu. The company engaging her services disputes her right to do so, pointing to the contract. They refuse to pay her for her additional two days work, and, believing she managed to complete a heavy workload in three days (as opposed to the five days it actually took), insist she accomplish more from now on.

Pauline had a contract in place however she decided to change the terms of engagement, with the best intentions in mind.

Had she discussed the situation and suggested she alter her work days in an effort to meet the tight deadline, the company engaging her would no doubt have appreciated her commitment and agreed to her taking time in lieu. Instead she felt poorly treated and under-appreciated and resigned the contract.

Prepare a Thorough Contract

A well drafted contract is an important risk management tool for your business. It should clearly reflect what you and your hirer have agreed and the expectations of both parties.
Ensure your contract is written down and that you understand and agree to all its parts before you sign it. If necessary get legal or financial advice and if English is a second language, consider the use of a translator.

Find more advice about negotiating contracts and disputes here.

If you’d like specific advice and assistance with administering your contractual arrangement, contact the experts at Ayers.


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