Can a client force me not to work for their competitors?

They can attempt to, but broad non-compete clauses are difficult to enforce in India against independent consultants. It is safer to negotiate this to apply only to direct competitors for a limited duration.

What happens if the project gets cancelled?

Your contract should include a 'kill fee' or cancellation fee. This ensures you are compensated for the time you reserved and the work completed up to that point.

🤝 Professional Services

Consulting Agreement Review

Q: Who owns the IP I create as a consultant?

Unless specified otherwise, the client generally owns the deliverables upon full payment. However, it is crucial to retain ownership of your 'Background IP' (pre-existing tools, libraries, frameworks) and only license them to the client.

Protect your IP and get paid on time. Our AI reviews Retainer Agreements, SOWs, and Independent Contractor Contracts to flag scope creep and unfair liability.

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Consultant vs Employee: The Legal Gap

A Consulting Agreement (or Indepedent Contractor Agreement) is fundamentally different from employment. You don't get labor law protections like severance or gratuity—the contract is everything.

The biggest risk for consultants is inadvertently signing a "Work for Hire" agreement that transfers ownership of your pre-existing tools or methodologies (Background IP) to the client, effectively preventing you from using them for other clients.

3 Clauses Every Consultant Needs

1. Background IP Reservation: Explicitly state that you retain ownership of all tools, code libraries, and frameworks you bring to the project. The client only gets a license to use them.
2. Kill Fee: If the client cancels the project midway through no fault of yours, you should be paid for the time reserved, not just the hours worked.
3. Late Payment Interest: Citing the MSME Micro Small and Medium Enterprises Development Act, 2006, you can demand interest (3x bank rate) if payment is delayed beyond 45 days.

Safety Checklist

✓ Clear Scope (SOW)

Are deliverables and timelines specific?

✓ Liability Cap

Is liability limited to fees paid?

✓ Non-Solicit

Is it mutual? (They can't hire your staff)

Late Payment Calc

AI Analysis: Key Risks

Critical Risk

Work for Hire / IP Transfer

Ensures you don't accidentally sign away your core business IP or tools.

High Risk

Non-Compete

Clients stopping you from working with others in their industry. We flag overbroad restrictions.

Medium Risk

Indemnification

Are you paying for their legal fees? We check for mutual or capped indemnity.

Review Your Consulting Contract

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Common Questions

Who owns the IP I create as a consultant?

Unless stated otherwise, the client usually owns the final deliverables upon full payment. However, you MUST retain ownership of your "Background IP" (pre-existing tools).

Can a client force me not to work for competitors?

They can try, but broad non-competes are hard to enforce against independent consultants. Negotiate to limit this only to direct competitors for the project duration.

What happens if the client doesn't pay?

If you are an MSME registered consultant, the MSME Act mandates payment within 45 days with interest. Ensure your contract references the MSME Act.

Other Contract Types

Freelance Contract | Service Agreement