Consultancy agreements

A consultant who provides periodic or temporary help to your business can be a huge asset. A consultancy agreement will set out the details of the service they will provide and the limits and constraints you wish to place on their conduct.

Expert legal advice for your business

At Hutchinson Thomas we understand the importance of having the right legal documentation in place to allow your business to run smoothly. Problems can arise, in particular in the area of employment law, if the contract between you and your contractors does not clearly outline their role. 

We will work with you to ensure that your contractors and self-employed workers are properly defined to ensure that you are not inadvertently taking on employee responsibilities.

As businesses become more flexible and responsive to the needs of their clients and customers and to market changes, consultants are being more widely used. Providing the right agreement will ensure that your relationships with contractors have stable foundations.

Taking on a consultant

The treatment of a consultant needs to be different from that of an employee to distinguish their legal standing. A consultant will be engaged for a specified time or for a particular project. They will be paid a fee on a self-employed basis and should not be on the payroll of a business. Instead, they will provide invoices for their services and pay their own tax and national insurance contributions.

The way in which the consultant works and reports to your business is important. If a dispute arose, the court would look at this for evidence of consultancy – it is not always enough that an agreement exists stating that the individual is a consultant.

A consultant will have a level of control over when and where they work, they will take breaks from working for a firm or work for others as well and they will use their own equipment to do the job. 

We can give you advice in respect of any consultancy relationship you have to ensure that the line between consulting and employment is clearly drawn.

Consultancy agreements for employers

A consultancy agreement will include the reason for the consultancy, payment and financial terms, responsibilities, obligations such as having sufficient professional indemnity insurance in place, and clauses relating to termination of the agreement. 

The services to be provided need to be clearly specified, to protect your position in the event that the contractor does not properly carry out their agreed tasks. The contract will also deal with issues such as who owns the copyright or intellectual property rights over work created under the terms of the agreement and any restrictions on the contractor working for competitors.

Taking on a consultant can provide your business with expert help on a flexible basis which is advantageous in a rapidly changing economic climate and where you do not need to take on a permanent employee. However, the area can be complicated and it is important to ensure that you have a clear legal framework in place to avoid difficulties and potential claims against you. 

Contact us

Hutchinson Thomas is the first law firm in Wales to be awarded the Law Society Mark of Excellence. The firm and many of our lawyers are recognised year on year in the Legal 500 publication as leading individuals in their field.

We work with employers across all of their employment law requirements. If you would like to speak to one of our expert employment solicitors about taking on a contractor and having a consultancy agreement drafted, call us on the following numbers or fill in our contact form.