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Contracts are the bedrock of any business. They make an agreement legally binding and outline the obligations and rights of each party. There are several different types of contracts, and they all administer different functions. Knowing what specific contracts are essential for your business is crucial. This article will outline what the key contracts are for a graphic design agency.

Key Contracts

The key contracts that you will need for a graphic design agency are:

  • an employment agreement;
  • a customer agreement;
  • an intellectual-property agreement; and
  • a partnership agreement.

Other agreements that you may also need include, are a:

  • service agreement;
  • terms of use contract; or
  • franchising agreement.

The type of service that will be provided as well as the parties to the contract are the main things these contracts will outline. Such contracts will also outline what will be exchanged for these services, which will usually be monetary.

Employment Agreement

If you are running a graphic design agency, then chances are you will have employees. Whether it be designers or accountants, you should draft a contract for these employees to work for your business. Otherwise, they could walk away at any time. The employment agreement will outline how often employees have to work and how much they get paid. 

There will also be provisions as to how you can fairly dismiss the employee. This protects the employee from unfair dismissal. It is essential that your contract accurately reflects the position of the employee. For example, some businesses try to classify their employees as contractors to avoid certain tax obligations. This is illegal, and the consequences can be severe.

Customer Agreement

The customer agreement is the contract you will form with customers when they want to use your services. This agreement may be for a one-off or a continuing service. The contract will enforce the agreement and ensure you provide the service on time whilst the customer pays for it. If there is a dispute, you and the customer can look at the contract terms. If there is still a dispute, you may initiate court proceedings.

Many businesses will use the same customer agreement for all their clients to save time. You can do this one as long as you slightly tailor each agreement to that specific customer. There should also be a clause explaining how each party to the contract can end the agreement. 

Intellectual Property Agreement

A graphic design agency is likely to have a significant amount of intellectual property. Intellectual property protects intangible creations of the human intellect. This can include specific designs or branding.

Firstly, you may have to sign an intellectual property agreement with your customers so that you are bound only to keep any property that you make for your customer’s use. Your customers may insist on this, so you cannot spread any branding to other competitors. If broken, these contracts may have a penalty.

Secondly, you may want to sign an intellectual property agreement with your employees so they do not use any intellectual property they have made for their own gain. The contract may also dissuade employees from discussing the property with anyone. Another name for this is a non-disclosure agreement. 

Partnership Agreement

If there is more than one owner of your graphic design agency or you want to bring on a new owner, you may want to consider forming a partnership. A partnership is an agreement to oversee a business and share profits and liabilities. A partnership agreement is a contractual document that underpins the business. This agreement will contain the rights and responsibilities of each partner as well as their shareholding. It will also contain the process for dissolving the business and how to bring new partners on board.

There should also be provisions that relate to decision making. This is because partners will not always agree on business decisions. There should be a process followed that will solve disputes if the partners are not in agreeance. 

Key Takeaways

If you are looking to set up a graphic design agency or already have one, then being aware of the most important contracts will keep you ahead of the pack. These contracts underpin relationships between people, and without them, your business could fall apart. These contracts will differ depending on the type of relationship you have with the other party and how long you wish for those relationships to carry on. They will also help manage your staff and any partnership arrangements you might have. If you need any legal assistance with contract breaches, contact LegalVision’s contract lawyers on 0800 005 570 or fill out the form on this page.

Frequently Asked Questions

Can these contracts be altered at any time?

You can alter contracts as long as all the parties to the contract agree to the variation.

Can I use a different agreement to set up my business?

Yes, if you are on your own then you will not need an agreement. You could register a company, which requires a company agreement.

If I have signed an intellectual property agreement, can I still use any property for my own use if I end up wanting to?

No, if you have signed an agreement, you cannot do this. You may seek the permission of your contracting party to cancel the contract, but they may want some monetary value in exchange.

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