Do You Need Contracts For Your VA Business?
Like most people, the majority of VA’s do not have a background in law and contracts. Your understanding of how things work will often be based on your experience as a customer, making sure that contracts that are covered by legislation, and that they protect you and your consumer rights. Somewhere in the back of your mind will be the idea that the law protects you and it is not necessary to issue contracts.
However, now you are the provider of services, and if you are working for private individuals, as many VA’s do, the law is now protecting your customers – not you! You are obliged to include certain bits of information in your contracts/terms of business, such as rates, payment terms, description of standards. Now your customers have their consumer rights and cancellation periods! However this is just about how you can protect them.
When it comes to B2B (business to business) contracts, you are mostly left to protect your business by issuing contracts that do the job for you. There is no legal obligation on you to protect your business from clients who don’t pay you, or associates who poach your clients, but you will quickly find that business is very hard if you don’t set out some expectations and limits that everyone can live with.
GDPR Was A Game Changer
Since the data privacy changes that came into effect with GDPR in 2018, there are many things which have changed. There are now many things which must be put in writing between you and your client, and you and your associates must make sure you are handling data privacy correctly. Whilst you can put all of that into separate documents and policies, for most VA’s it is quicker and easier to have it all sorted out in the contract from the start.
If you are just starting out, it may come as a bit of a shock. Having previously worked for an organisation, you are used to all of this being taken care of for you. When you are an employee, it is your employer’s job to tell you what to do when it comes to data security, and your job to comply.
But as the new ‘data controller’ for your own business and ‘data processor’ when handling your client’s data about their people, you will need to make sure your contracts and data privacy handling are up to scratch. The buck, as they say, stops at the top – and now you are the boss, so it stops with you.
Verbal Agreements Are No Longer Enough
Whilst it is still possible to do business on a verbal basis in a B2B environment, as long as you are not touching any form of personal data about your client’s prospects, customers or team, most VA’s still don’t work that way.
Another problem is that there is no record of who has said what, and your recollection will always be slightly different from the other person’s. There is an old lawyers saying:
“A verbal agreement is not worth the paper it is not written on”.
Which is a lawyer’s way of saying that it is extremely hard to enforce or interpret a verbal agreement, and it can often be functionally worthless. Getting paid under a verbal agreement can be impossible if your client insists the contract was not fulfilled – and who is to say what the payment terms were?
Can I Copy A Contract – Or Get A Free One?
We hear VA’s ask where they can get free templates, or whose contract to copy. This approach can be a big mistake.
Many UK VA’s copy USA style contracts without realising that the two systems for data privacy, tax, and more are very different. Whilst we do share a common legal heritage, the last few decades have made our systems diversify, and it is not useful to have a USA style contract for UK contracts. It makes about as much sense as having one in French.
Other VA’s cut and paste various elements from competitor’s contracts they like the look of. If your competitor’s contract was written specifically to support their way of doing business, you could be incorporating things into your contract that don’t work for you. And of course, you have no way of knowing how up to date that contract is.
It is surprising how many VA’s set up shop and start editing legal documents lately, oblivious to the fact they are taking out the very words that were put in to protect them later on.
In this new series of articles we will be taking you through some of the contract basics, and how they are changing as the global data privacy environment and UK contractual and tax base diversify.
You will need to get your ducks in a row more than ever this year.