Set contract term and termination

The term of the contract specifies the date the agreement goes into effect, and when it ends. Typically, the term begins upon contract execution. Termination is driven more by the nature of the consulting work you’re performing. Most times, termination occurs when you finish providing your services. Other termination clauses explain the various scenarios under which the agreement can be terminated. There are a lot of reasons a contract can be terminated. Here are some of the most common ones. Termination for convenience means a party can end the contract whenever it feels like it. If this clause is in there, be sure there’s a provision that you’ll be paid for work you’ve performed up to the date of termination. Also ask that if this provision is invoked, that there’s a reasonable written notification period, like 30 or 45 days, so you can wrap up your work. At Thought Leaders I had a client where this provision for termination for convenience was in there. There was a reorganization. My business sponsor left the company. I received written notification 30 days before the contract was going to end. What that did was it gave me an opportunity to wrap up my work and give my client some great deliverables, and spin up some new work that I could start as soon as the contract ended. Termination for breech can occur if one of the parties breeches a major provision of the contract. The other party can terminate the agreement when that happens. Force majeure allows the contract to be terminated if there’s an act of nature, war, terrorism, or other extreme event beyond the party’s control. Termination for insolvency can occur if one of the parties goes bankrupt or is financially unable to continue delivering or paying for services. Termination due to assignment can occur if there are events like an acquisition. If another company buys your client, and that company already has a preferred consulting firm, they might want to terminate your contract. The termination section can also dictate which clauses survive termination and what payments do or don’t occur due to termination. Things like confidentiality provisions might stay in place even after a contract is terminated. There may be early termination penalties spelled out in this clause as well. At some point, all contracts end. Be sure your contract is specific as to the circumstances when that can happen and what occurs when it does.