Introduction
A consulting partnership agreement template entails any written or oral agreement to retain the services, for a fee, of a consultant for the purposes of:
- providing counsel to a contractor, vendor, consultant or other entity seeking to conduct, or conducting, business with the State.
- contacting, whether in writing or orally, any executive, judicial, or administrative office of the State, including any department, institution, bureau, board, commission, authority, official or employee for the purpose of solicitation, dispute resolution, introduction or requests for information or
- any other similar activity related to such contract
A consulting partnership agreement template also entails p between a business and a consultant providing that company with their services. Other terms that are used to refer to a consulting agreement include:
- Business consulting agreement
- Independent contractor agreement
- Freelance contract
- Consulting contract
The consulting partnership agreement template explains the terms of the professional relationship as a method for keeping both parties accountable when it comes to the type of work and compensation expected. Having a consulting partnership agreement template when contracting the services of an outside advisor or specialist is a standard part of running a business and helps protect your company from possible disputes.
As you build your consulting practice, establishing partnerships with other consultants is an effective approach to getting more client work and has multiple benefits. This is an approach I call partnership consulting. In short, partnership consulting is working with another independent contractor or a consulting firm on an ongoing engagement or series of single engagements where you provide your expertise to their consulting clients.
What is a consulting partnership agreement template
A Consulting Agreement is a written contract that outlines the terms and conditions of a professional service. One can use various templates create a custom document that suits a client’s specific needs. Whether you’re a freelancer, an established business, or a client, you’ll find that our template is simple to use and covers all the terms that are central to an effective service agreement.
What is a consultant under a consulting partnership agreement template?
Consultants are specialists that provide expert advice to companies or individuals looking to improve the efficiency and effectiveness of their business. This contract is suitable for a variety of consultant service industries, including:
- Information technology (IT)
- Human resources (HR)
- Business management
- Marketing
- Engineering
- Legal advice
Importance of a consulting partnership agreement template
A written contract clearly establishes the terms and conditions of a service agreement. This helps reduce the chances of conflict between the consultant and the client. It also provides evidence of the agreement if a dispute goes to court.
Types of consultants in a consulting partnership agreement template
A consultant is an outside professional who provides expertise and advice to improve a business’s operations in some way. They analyze current business behavior, identify areas for improvement, and develop a plan for improving that aspect of the company. Consultants may also train other staff members and oversee the implementation of new business tactics, evaluating the outcome and making adjustments as needed.
Consultants often specialize in a niche area of their market, using each business opportunity to build their expertise and apply it to improve best practices. Some of the different types of consultants you can hire to work for your business are:
- IT consultant: Businesses hire IT consultants to help optimize their tech support, internal networking, software, and web development.
- Operations consultant: These specialists focus on your company’s manufacturing and supply chain efficiency, finding ways to improve storage, delivery, and response times.
- HR consultant: As small companies grow; they rely on HR consultants to ensure that they are meeting their legal obligations as an employer while also developing a convenient and consistent onboarding system.
- Financial consultant: Consultants can also analyze company finances and find ways to pay down debt, cut costs, increase profits, and make investment plans for the long-term growth and financial health of the company.
- Leadership consultant: Career coaches and leadership consultants identify talented potential leaders with a focus on improving teamwork and coaching executives for leading high-performance projects.
- Legal consultant: Hiring a legal expert to consult on contracts and other legal situations helps protect your business from liability and gives you a technical perspective on your business.
- Compliance consultant: Compliance specialists have extensive knowledge of industry regulations and standards, which they use to assess company operations and recommend ways to meet those specifications.
Even within a certain field, consultants can specialize even further. For example, a digital marketing consulting firm could have consultants specializing in SEO coordination, social media advertising, affiliate marketing, and more.
When to use a consulting partnership agreement template
Any time you’re paying an outside candidate to work for your business, draw up a consulting agreement. While some people are used to verbal contracts, having a written record of the consulting partnership agreement template keeps both parties accountable and ensures that an untrustworthy person doesn’t accept payment without delivering their services appropriately.
Have your consultant sign a consulting partnership agreement template prior to hiring them for the job so that you can start off your professional relationship on the right foot. If problems arise later on, you can reference the consulting agreement for guidance.
Benefits of using a consulting partnership agreement template
Using a consulting partnership agreement template has several key benefits for businesses:
- Setting clear expectations for quality
- Determining a timeline
- Establishing professional policies
- Holding contractors accountable
- Agreeing on a specific budget
- Documenting your business relationships and expenses
Are consulting partnership agreement templates legally binding?
Consulting partnership agreement templates are binding contracts that can have legal consequences. The terms of a consulting partnership agreement template often have clauses that explain what to do if a dispute occurs and what actions the offended party could take. If you paid a consultant for work, they didn’t deliver, you could use the contract as evidence in a small claims court to recover the money you lost.
If your contract violates local law, then you won’t be able to enforce its terms, so it is smart to have a contract lawyer review any contract you give to a potential consultant or consulting firm. To give your consulting agreement additional legitimacy, have it notarized by a witness. This decreases the chance that the consultant could dispute the terms of the contract.
Drafting a consulting partnership agreement template
To write a consulting partnership agreement template, be sure to include the following information:
- Describe the details of the service
Give a time frame for how long the work is expected to last: until the project is complete, until a specified date, or until the parties decide to end the contract. You’ll also need to select the state in which the consultant will work. This affects the laws that will apply to your service agreement. Then, write a description of the consultant’s services. For example, an IT consultant might perform a systems analysis, update security software, and supply computer hardware.
- Provide party details
Whether the relationship is between two corporations, an individual and a corporation, or two individuals, it’s important to include the names and addresses of the parties in the consulting partnership agreement template.
- Include billing info
Explain payment terms such as the consultant’s service fee, a retainer fee (if applicable), and payment due dates. You can choose to make payments due when the services are complete or at certain stages of work (e.g., project milestones). The consulting partnership agreement template also gives the option to add sales tax to your bill.
- Clarify other charges and expenses
Optionally, you can address late payments by setting an interest rate on unpaid sums. You might also allow the consultant to bill work expenses, such as travel costs, to the client. Work expenses might be restricted to a certain amount or subject to the client’s approval.
- Consider other terms and conditions
If the consulting partnership agreement template has a fixed term, you can address whether either party can end the contract early. If so, you must specify how many days of notice the party seeking to end the contract must give to the other party. If intellectual property (IP) is involved, it’s important to state whether the client or the consultant will retain exclusive ownership rights. Examples of IP include creative works such as blueprints, custom software, logos, legal drafting, or advertisements. Unless specified otherwise, the client that paid for the work typically keeps ownership rights.
However, some consultants may choose to retain ownership if the IP is a “tool of the trade” (i.e., a skill or piece of equipment needed to complete a job). Furthermore, you should specify whether any IP or other sensitive information is confidential. If so, state how long the duty of confidentiality should last (e.g., until the end of the agreement or indefinitely).
- Add a unique clause in the consulting partnership agreement template
Customize the consulting partnership agreement template with an additional clause written by you. Although most contracts won’t need any extra terms, you might want to address factors like:
- Indemnity
- Return of property
- Liability
Adding the preceding terms to the consulting partnership agreement template optional and entirely depends on the partners’ personal situation.
Parts of a consulting partnership agreement template
A standard consulting partnership agreement template will have several different clauses that summarize a range of contract details, including:
- Start date and end date
- Services being provided
- Contact information for the consultant
- Contact information for the business
- Ownership of intellectual property
- Compensation and fees
- Termination procedures
- Process for handling disputes
- Expected communication channels
- Confidentiality information
- Liability
- Noncompetition agreements
- Indemnification
- Reimbursement policies
- Terms for enforcing the agreement legally
- Signatures and initials acknowledging the agreement
Not all consulting partnership agreement templates need all of these sections, but they provide a solid overview of the type of information that goes into securing a contract with a consultant. The more specific the contract is, the more guidance both the consultant and the company have when collaborating.
How to create a consulting partnership agreement template
Some consultants may present you with a consulting contract first, especially if they are part of a consulting firm that takes on a high volume of clients. However, you may want or need to create a consulting partnership agreement template from scratch to suit the needs of your company.
- Use a template
You can find a standard legal boilerplate online to start as a base for your consulting agreement. If you choose to use a template, make sure you understand what each clause means so that you don’t inadvertently agree to unfavorable contract terms. Consider adjusting an existing template to create a custom form that you can use for future consulting needs. You can also hire an expert to draft a custom legal contract for you.
- Decide on a project timeline for the consulting partnership agreement template
Agreeing on deadlines is one of the key functions of a consulting partnership agreement templates not, so it is important to set a reasonable start date, check-in dates, and project completion dates before reaching out to consultants. Look at past projects to make an informed estimate of how long the project should take.
- Set your essential terms
Your business might be flexible on some parts of the consulting relationship, but it is important to know ahead of time what requirements you will not budge on. Make a list of the most important contract clauses for protecting your business while moving forward with a project. Examples include:
- Company ownership of any materials created during the consultation process
- Weekly payment frequency
- Contract nullification after a period of no contact
- Minimum and maximum contract length
- Number of deliverables needed
- Equipment and materials provided for the consultant
- Research terminology
As you fill out each section of the consulting partnership agreement template, look up any legal terms that you are unsure about or do not recognize. If necessary, ask for legal advice to ensure that you know what the jargon in your contract means.
Documents to use alongside a consulting partnership agreement template
More complex business relationships could require more than just a consulting contract. You can supplement the consulting partnership agreement template by having the consultant sign one of these documents in conjunction with their primary contract:
- Receipt of employment handbook: An employment handbook can outline behavioral expectations and HR procedures in more detail. Have contractors sign an acknowledgment that they will abide by workplace policies and expectations.
- Non-solicitation agreement: This contract restricts the consultant from working for your competitors or poaching your clients, customers, and staff for their own business.
Having a consulting partnership agreement template with each independent contractor can give you peace of mind that your company will run smoothly and according to plan. It keeps your outside employment organized and sets up consultants for success and seamless collaboration.
What to consider when composing a consulting partnership agreement template
If you’re thinking of creating a consulting partnership agreement template, there are many questions you’ll need to ask yourself. Some of them might include:
- How many shares will each partner have in the business?
- What will be the title for each partner?
- Is there a description of responsibilities or job duties for each partner?
- How much authority will each partner have?
- How much will each partner need to invest?
- Is there a certain amount of time each partner should dedicate to the business each week?
- How will profits, losses, and depreciation be distributed to each partner on a monthly basis?
- What will each partner do if the company requires more capital?
- How will each partner be responsible for future investments?
- If a partner does not fulfill their time obligations, what should be the penalty?
- If a partner does not fulfill their investment obligations, what should be the penalty?
- If a partner suffers an injury, how will that affect their investment and time obligations?
- If a partner passes away, are there rules in place that specify what happens to their shares?
- Is it possible to transfer a partner’s shares to another person?
- How will the investments of each partner be valued?
- In the event that a partner wishes to depart the partnership, what would be the procedure?
- Do the two partners require a non-compete agreement?
- Can one partner become involved or invest in a competing business?
- If loans are required, how much will each partner be responsible for?
- Are there certain activities or actions that each partner must agree upon?
- Are there any business expenses that each partner must agree upon?
Outline of a sample consulting partnership agreement template
While every consulting partnership agreement template will contain different details, the basic structure will remain the same. The first section will describe the scope of work and might include sections on:
- Time and availability.
- Standard of conduct.
- Outside services.
The main section in an agreement contains information about the independent contractor. It might include information such as:
- Who the independent contractor is.
Next comes a section on compensation for consulting services. It will cover:
- How much the company will pay for the consultation.
- Reimbursement for certain expenditures.
You might also want to cover the term and termination of the agreement, confidentiality, rights and data, conflict of interests, the right to injunctive relief, and any other general provisions.
The advantages of partnership consulting
Partnership consulting allows you as the subcontractor to:
- find new projects if business development is not your forte;
- keep your project roster full and have multiple streams of income to supplement your direct client relationships;
- have the opportunity to work on different kinds of projects with different types of organizations;
- build your expertise in new areas of your profession.
Examples of terms in a consulting partnership agreement template
Article 1
Scope of work under the consulting partnership agreement template
1.1 Services. The Company has engaged Consultant to provide services in connection with the Company’s [summary of the project or business of the Company]. Consultant will [summary of the services Consultant is to provide], and such other services as described in Exhibit A (collectively, the “consulting services”).
1.2 Time and Availability. Consultant will devote _______ hours per month in performing the services for the Company as stated herein. Consultant shall have discretion in selecting the dates and times it performs such consulting services throughout the month giving due regard to the needs of the Company’s business. If the Company deems it necessary for the Consultant to provide more than ________ hours in any month, Consultant is not obligated to undertake such work until the Consultant and Company have agreed on a rate of compensation. [The time devoted can be hours per day, per week, or per year. The Company may also elect to pay a flat monthly fee regardless of hours, but the Company should be cautious of this approach.]
1.3 Confidentiality. In order for Consultant to perform the consulting services, it may be necessary for the Company to provide Consultant with Confidential Information (as defined below) regarding the Company’s business and products. The Company will rely heavily upon Consultant’s integrity and prudent judgment to use this information only in the best interests of the Company.
1.4 Standard of Conduct. In rendering consulting services under this Agreement, Consultant shall conform to high professional standards of work and business ethics. Consultant shall not use time, materials, or equipment of the Company without the prior written consent of the Company. In no event shall Consultant take any action or accept any assistance or engage in any activity that would result in any university, governmental body, research institute or other person, entity, or organization acquiring any rights of any nature in the results of work performed by or for the Company.
1.5 Outside Services. Consultant shall not use the service of any other person, entity, or organization in the performance of Consultant’s duties without the prior written consent of an officer of the Company. Should the Company consent to the use by Consultant of the services of any other person, entity, or organization, no information regarding the services to be performed under this Agreement shall be disclosed to that person, entity, or organization until such person, entity, or organization has executed an agreement to protect the confidentiality of the Company’s Confidential Information (as defined in Article 5) and the Company’s absolute and complete ownership of all right, title, and interest in the work performed under this Agreement.
1.6 Reports. Consultant shall periodically provide the Company with written reports of his or her observations and conclusions regarding the consulting services. Upon the termination of this Agreement, Consultant shall, upon the request of Company, prepare a final report of Consultant’s activities.
Article 2
Independent contractor under the consulting partnership agreement template
2.1 Independent Contractor. Consultant is an independent contractor and is not an employee, partner, or co-venturer of, or in any other service relationship with, the Company. The manner in which Consultant’s services are rendered shall be within Consultant’s sole control and discretion. Consultant is not authorized to speak for, represent, or obligate the Company in any manner without the prior express written authorization from an officer of the Company.
2.2 Taxes. Consultant shall be responsible for all taxes arising from compensation and other amounts paid under this Agreement, and shall be responsible for all payroll taxes and fringe benefits of Consultant’s employees. Neither federal, nor state, nor local income tax, nor payroll tax of any kind, shall be withheld or paid by the Company on behalf of Consultant or his/her employees. Consultant understands that he/she is responsible to pay, according to law, Consultant’s taxes and Consultant shall, when requested by the Company, properly document to the Company that any and all federal and state taxes have been paid.
2.3 Benefits. Consultant and Consultant’s employees will not be eligible for, and shall not participate in, any employee pension, health, welfare, or other fringe benefit plan of the Company. No workers’ compensation insurance shall be obtained by Company covering Consultant or Consultant’s employees.
Article 3
Compensation for consulting services under the consulting partnership agreement template
3.1 Compensation. The Company shall pay to Consultant $_________ per month for services rendered to the Company under this Agreement. The monthly compensation shall be paid on the first of the month following the month the services were provided. The monthly compensation shall be paid regardless of the number of consulting hours provided by Consultant in a particular month. [Another option is to pay hourly and require monthly time documentation. The monthly compensation would be reduced by the hourly rate for the number of hours less than the devoted hours.]
3.2 Reimbursement. The Company agrees to reimburse Consultant for all actual reasonable and necessary expenditures, which are directly related to the consulting services. These expenditures include, but are not limited to, expenses related to travel (i.e., airfare, hotel, temporary housing, meals, parking, taxis, mileage, etc.), telephone calls, and postal expenditures. Expenses incurred by Consultant will be reimbursed by the Company within 15 days of Consultant’s proper written request for reimbursement.
Article 4
Term and termination under the consulting partnership agreement template
4.1 Term. This Agreement shall be effective as of _________, 201__, and shall continue in full force and effect for ____ consecutive months. The Company and Consultant may negotiate to extend the term of this Agreement and the terms and conditions under which the relationship shall continue.
4.2 Termination. The Company may terminate this Agreement for “Cause,” after giving Consultant written notice of the reason. Cause means: (1) Consultant has breached the provisions of Article 5 or 7 of this Agreement in any respect, or materially breached any other provision of this Agreement and the breach continues for 30 days following receipt of a notice from the Company; (2) Consultant has committed fraud, misappropriation, or embezzlement in connection with the Company’ s business; (3) Consultant has been convicted of a felony; or (4) Consultant’s use of narcotics, liquor, or illicit drugs has a detrimental effect on the performance of his or her employment responsibilities, as determined by the Company.
4.3 Responsibility upon Termination. Any equipment provided by the Company to the Consultant in connection with or furtherance of Consultant’s services under this Agreement, including, but not limited to, computers, laptops, and personal management tools, shall, immediately upon the termination of this Agreement, be returned to the Company.
4.4 Survival. The provisions of Articles 5, 6, 7, and 8 of this Agreement shall survive the termination of this Agreement and remain in full force and effect thereafter.
Article 5
Confidential information under the consulting partnership agreement template
5.1 Obligation of Confidentiality. In performing consulting services under this Agreement, Consultant may be exposed to and will be required to use certain “Confidential Information” (as hereinafter defined) of the Company. Consultant agrees that Consultant will not and Consultant’s employees, agents, or representatives will not use, directly or indirectly, such Confidential Information for the benefit of any person, entity, or organization other than the Company, or disclose such Confidential Information without the written authorization of the President of the Company, either during or after the term of this Agreement, for as long as such information retains the characteristics of Confidential Information.
5.2 Definition. “Confidential Information” means information not generally known and proprietary to the Company or to a third party for whom the Company is performing work, including, without limitation, information concerning any patents or trade secrets, confidential or secret designs, processes, formulae, source codes, plans, devices or material, research and development, proprietary software, analysis, techniques, materials, or designs.
References
https://www.findsmartresults.com/
https://www.siftforresults.com/
https://www.extension.iastate.edu
https://www.contractscounsel.com
https://ww.extension.iastate.edu
https://www.revv.so/templates/t/consulting-agreement
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