What to include in a freelance contract, clause by clause

A contract for creative work needs about ten clauses: the parties and the scope; the deposit, payment terms and late fee; rounds of revisions and change requests; a kill fee for cancellation; the usage rights the client gets and when they pass; your right to show the work; and confidentiality, liability and governing law. In New York State and Illinois, the law already requires the parties, the work and the pay to be set out in writing. Here is what each clause does, so you can check your own contract for gaps. This is how these terms usually work in the US, not legal advice for your situation; the last section says when to bring in a lawyer.

Clause	What it settles	Check that it says
Parties and scope	Who is hiring whom, to make what	Legal names, every deliverable, what is not included
Payment	When and how you are paid	The deposit, the due dates, the late fee
Revisions and changes	How much changing the fee covers	The number of rounds, how a change is priced and agreed
Kill fee and ending it	What canceling costs	The deposit is kept, the work to date is paid
Usage and rights	What the client may do with the work	The license or transfer, and that it starts on final payment
Showing the work	What you may put in your portfolio	Where, and from when
Confidentiality, liability, law	Risk and disputes	A cap on liability, and which state’s law applies

Why you need a contract as well as a proposal

The proposal sells the project: the goal, the deliverables, the timeline and the price. The contract covers what happens when it doesn’t go to plan. You can send them together: the terms in the AIGA Standard Form of Agreement for Design Services are designed to be attached to your own proposal, and the two, once signed, make the binding agreement. Or you can send the proposal first and the contract once the client picks an option; how to write a freelance proposal covers that first document. Either works, provided both are signed before work starts.

There are two more reasons to put it in writing. Some states now require a written contract for freelance work (more on that below), and a client who expects to own the copyright needs a signed transfer to own it.

The parties, the project and the scope

Start with who the agreement is between: your business name (and your own, if you trade as a sole proprietor) and the client’s legal entity, not just the person you’ve been emailing. Name who approves the work and who pays the invoices.

Add a line that you are an independent contractor: you choose how and when to do the work, use your own equipment and pay your own taxes. For the scope, refer to the accepted proposal by its date or attach it, so its deliverables and its list of what is not included become part of the contract.

Deposit, payment terms and the late fee

The payment clause is the one you will point to most often:

• Deposit. The amount, paid before work starts, and that it is non-refundable once you begin, because it pays for the dates you hold.
• Payment terms. When each invoice is due, such as net 15 from the invoice date, and whether the fee is split by stage.
• Late fee. A flat fee or a monthly percentage on overdue amounts, set here before the work starts and kept within what your state allows. A late fee the contract never mentioned is hard to charge later.
• Expenses. What you bill on top of the fee, such as licenses, printing or travel, and that anything over an agreed amount needs the client’s approval first.
• Final files. That they are delivered once the final invoice is paid.

If an invoice does go late, how to ask a client for payment has the schedule and the wording, from the first reminder to the final notice.

Rounds of revisions and change requests

Say how many rounds of revisions the fee includes at each stage, and what a round is: one consolidated set of feedback from the client, answered with one revised version. Then say what happens after the last round, usually further changes billed at your day rate.

A revision refines what the proposal described; a change request adds to it, like a new deliverable or a new direction after one was approved. The contract should say that changes are quoted in writing, with what they add to the fee and the timeline, and agreed before the work starts. The change-request form in The Studio Kit does this on one page, and how to handle scope creep covers what to say when the request arrives. Add a line for delays on the client’s side too: if feedback is late, the schedule moves, and if the project stalls for, say, 30 days, you can invoice for the work to date.

The kill fee and ending the agreement

A kill fee is what the client pays if they cancel before the project is finished. No law sets the amount, so the contract has to. A common structure ties it to the stages: before the first presentation, you keep the deposit; after it, the client also pays for each stage completed by the cancellation date. Some contracts add a share of the remaining fee, because you turned down other work to hold the dates.

The same clause says how either side can end the agreement: by written notice, and immediately if the other side breaks it, for example by not paying. It should also say what the client may use after a cancellation, usually only the work they have paid for, and that everything else stays yours.

Usage, licensing and when the rights pass

This is the clause creative contracts turn on, and the one a generic template is least likely to fit. In US law, copyright belongs at first to the person who creates the work, and owning the copyright is separate from owning the object it sits in: a client who holds the files does not own the copyright by holding them. The client gets what the contract grants, in one of three ways.

A license

The client may use the work in agreed ways and you keep the copyright. A license names the uses (packaging, advertising, a website), where (a country, or worldwide), for how long and whether it is exclusive. Illustration and photography are usually licensed this way, and a wider use later is a new fee.

A transfer

You assign the copyright to the client, for a logo and the core of an identity, say. Under the Copyright Act, a transfer is not valid unless it is in writing and signed by the owner, which is you. Keep the transfer to the final work: the concepts the client didn’t choose stay yours.

Work made for hire

Here the client is treated as the author from the start. As the U.S. Copyright Office’s Circular 30, Works Made for Hire, explains, that happens in only two situations: work an employee does as part of their job, or a commissioned work in one of nine categories (among them a contribution to a collective work such as a magazine, part of a film or other audiovisual work, and an instructional text) where both sides sign a written agreement calling it a work made for hire. A work that fails any of those tests is not one. Much identity, packaging and print design fits none of the nine categories, which is why many client contracts pair a work-for-hire clause with a transfer as a fallback. If such a clause reaches further than the final work, ask a lawyer before you sign.

Whichever you use, say when it takes effect: on payment in full. Until then, the client may review the work but not use it. Then name what the license or transfer leaves out: fonts, stock photos and other third-party material the client must license itself.

Your right to show the work

Agree up front that you may show the finished work, and your process, in your portfolio, on your website and social media, in award entries and in a newsletter to past clients. Add that you will wait until the client has launched it, and that work under a confidentiality agreement is shown only with their permission. Without the clause, a client who later objects has a point.

Confidentiality, liability and governing law

The last clauses deal with risk, and they are short:

• Confidentiality. Both of you keep the other’s private business information private, during the project and after it.
• Limitation of liability. Your total liability under the contract is capped, often at the fees paid, and neither side is liable for indirect losses such as lost profits.
• The client’s materials. The client confirms it has the right to use the text, photos and logos it gives you. If you are designing a new name or logo, the contract says you are not doing a trademark search, and that the client should have one done by a trademark lawyer.
• Governing law and disputes. Which state’s law applies, where a dispute would be heard and whether you try mediation first.

Laws that already require a written contract

In some places, a written freelance contract is the law, not just good practice. These laws put the duty on the hiring party, but if your own contract includes what they require, it can be the document both of you sign.

• New York State. The Freelance Isn’t Free Act took effect on August 28, 2024, and the state Department of Labor’s Freelance Isn’t Free Act page has a model contract. It covers work worth $800 or more, alone or added to other contracts with the same client in the previous 120 days. The law itself says the contract must give both parties’ names and mailing addresses, the services itemized with their value and the rate and method of pay, the payment date or how it is set, and the date by which you submit a list of the services you provided. Without a payment date, you must be paid within 30 days of completing the work. The hiring party keeps the contract for six years, and you can file a complaint with the state Attorney General.
• Illinois. The Freelance Worker Protection Act took effect on July 1, 2024, and covers work worth $500 or more in one contract or across contracts in 120 days. The contract must give both parties’ names and contact details, the products or services itemized with their value and the rate and method of pay, and the date payment is due, which Jackson Lewis’s summary of the act says must be no later than 30 days after the work is provided. The hiring party keeps the contract for at least two years. As Illinois Legal Aid Online explains, a complaint to the Illinois Department of Labor or a lawsuit must be filed within two years of when the final payment was due.
• Elsewhere. The list keeps growing. The Freelancers Union’s Contract Creator builds a contract step by step, with optional clauses for a kill fee, ownership and revisions, and has sections for New York State and City, Illinois, California, Los Angeles, Seattle, Minneapolis and Columbus. Check what applies where you and your client are.

When a lawyer should read it

A good template gets you most of the way, and the contract in The Studio Kit has a plain-English note beside each clause saying what it does. But a template is written for no one in particular, and contract law differs from state to state. Ask a lawyer where you work to read your contract:

1. Once, before you first rely on it, so you have a standard version to reuse.
2. When a client sends its own contract, especially one with a work-for-hire clause, a transfer of every right in every concept, open-ended indemnities, unlimited revisions or payment only “on approval.”
3. When the fee is large, the license involves royalties or the client is abroad.
4. When a dispute starts, before you reply in writing.

A review of your standard contract is a cost you pay once, and the clauses above are the list to bring to it. More on working with clients is in the Clients section.