What legal documents do you need when working with clients?
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Posted: Tue 6th May 2025
7 min read
As a business owner, freelancer or consultant, working with clients can be a rewarding yet legally complex experience.
To protect your business and make sure you're operating in line with the law, you must have the right legal documents in place.
From privacy policies to service agreements, these documents help safeguard your interests, clarify your relationships with clients and keep you working within legal guidelines.
Here's a practical guide to the key legal documents you need when working with clients.
1. Privacy policy
If you're collecting any form of personal data from your clients – names, emails, phone numbers, payment details – you must have a privacy policy.
This document is vital if you're going to abide by data protection laws such as the General Data Protection Regulation (GDPR). This law applies if you're operating within the EU (or if you're targeting EU customers).
A good privacy policy should include:
what personal information you collect
how you use that information
who has access to it (for example, subcontractors, employees)
how you store and protect the data (for example, encrypted storage, password protection)
how long you keep the data and your data retention policy
your clients' rights regarding their data (for example, their right to access, update or delete their personal information)
If you're not sure where to start, there are plenty of free templates on the ICO (Information Commissioner's Office) website, which provides easy-to-follow guidelines for drafting this document.
2. Cookie policy
If you run a website, you likely use cookies. These small data files track user behaviour and preferences to improve our site's functionality.
If your website uses cookies, you must, by law, have a cookie policy that outlines which cookies you're using, their purpose (such as analytics or advertising) and how long they remain active.
Your cookie policy should include the following key points:
What cookies you use on your site
The purpose behind each cookie (for example, improving user experience, tracking analytics)
How long cookies are stored on users' devices
How users can control or disable cookies on their browsers
Having a cookie policy is essential to comply with GDPR, particularly for businesses with EU customers.
3. Terms and conditions for online sales
If you're selling products, services or digital content online, you must have clear terms and conditions (T&Cs) or terms of sale in place.
This document outlines the rules and guidelines your customers must agree to when making a purchase on your website. It's a legal requirement in many countries to make sure business practices are transparent and fair.
Essential elements of your T&Cs include:
a description of the goods or services you're selling
the price, payment terms and any recurring charges (like subscription services)
delivery and shipping details for physical products
a refund and cancellation policy (including when clients are entitled to refunds)
dispute resolution procedures, such as how you'll handle complaints
It's a good idea to seek legal advice when drafting this document, as it can vary depending on the nature of your business and what you're selling.
4. Service agreements (contracts)
When you're providing services – whether in person or remotely – having a service agreement or contract is essential.
This formal agreement defines the relationship between you and your client and makes sure both parties are clear on expectations, deliverables, timelines and payment terms.
A solid service agreement should include the following:
Payment terms: Clearly outline how much you'll be paid, the payment schedule and any penalties for late payments.
Scope of work: Specify what services you'll provide, including any limitations on the work.
Timeline: Outline key milestones or deadlines, as well as any penalties for missing deadlines.
Intellectual property (IP): Clarify who will own the work or content produced. For example, if you're a designer creating graphics, specify whether the client will own the IP or if they're only receiving a licence to use it.
Termination clause: Detail how either party can end the agreement, whether that's due to non-payment, breach of contract or other circumstances.
Confidentiality: If you handle sensitive client information, include a confidentiality clause to protect both parties.
Liability: Specify your liability limits in case something goes wrong with your service.
It's worth noting that some clients may want to provide their own contract. But it's generally a good idea to have your own template to make sure the terms favour your business.
5. Contracts for subcontractors and partners
If you're working with subcontractors, freelancers or business partners, it's crucial to have contracts in place to outline expectations, confidentiality, payment terms and deliverables.
This prevents disputes later on and makes sure everyone is clear about their roles and responsibilities.
6. Non-disclosure agreements (NDAs)
In certain situations – particularly when discussing sensitive or proprietary information with clients, subcontractors or partners – a non-disclosure agreement (NDA) can be beneficial.
This agreement ensures that the other party (or parties) won't disclose any confidential information you've shared with them without first getting your consent.
Final thoughts
Having the right legal documents in place helps make sure your business can run smoothly, protect its intellectual property and lessen its legal risks.
While there are lots of templates for these documents available online, don't hesitate to seek professional legal advice for the more complex ones, especially if you're not sure about specific clauses or terms.
By investing the time to set up these documents properly, you're not just protecting your business – you're building trust with your clients.