Consulting Agreement (with Retainer) Templates

A consulting agreement is typically required when a client wishes to enlist an expert or a specialist in a particular field to give them advice on certain projects and/or occurrences.  The consultant, for legal purposes, is considered an independent contractor who provides their input in exchange for monetary compensation. They may be paid by the hour or may choose to receive a lump sum in exchange for their input. Some clients may want to retain their services, and so will require a retainer. This essentially functions as a method of “pre-paying” for their services and will require the consultant to approximate a number of hours for which the client will have to pay them in advance. Retainers can last for as long as the client wishes, but in the field of consultancy, typically range from a few months to a year.

A consulting agreement is needed when a client wishes to enlist an expert for advice and/or consultancy with regards to a particular project. The expert functions as an independent contractor, and so, all proprietorship of the work will go to the owner. In exchange, the expert is paid a flat fee or is paid by the hour.

What does a retainer do?

A retainer allows the client to hold on to the expert’s services for an extended amount of time. In return, the client typically has to pay for an approximated number of hours, allowing them to hold on to the expert’s services for the period of the retainer agreement. Additionally, some agreements require the client to pay a down payment or a deposit as a token of good faith before the commencement of the contract. Clients should keep in mind that they may add clauses that entitle them to refunds in case the approximated number of hours isn’t fulfilled by the expert. Additionally, the client may also choose to add additional clauses, such as a satisfactory performance clause, which allows them to terminate the contract at any point, exclusivity clauses, and in some cases, non-disclosure clauses as well.

Other clauses to keep in mind

While a satisfactory performance clause may not be necessary, many clients will insist on a number of other stipulations to guarantee their protection, at least in legal terms. Here are a few clauses that are typically embedded into the body of a consulting agreement;

  • Confidentiality Clause – A confidentiality clause binds the expert and the client into non-disclosure regarding any particulars, details, and occurring that take place during their working relationship. It also prevents the consultant from disclosing any confidential information regarding the job after the term of the contract, which is why many clients insist on such a clause in a consulting agreement.
  • Non-compete Clause – Essentially, a non-compete clause prevents either party, i.e., the client and the consultant, from competing with each other directly, both during and after the term of the contract.
  • Indemnification Clause – An indemnification clause holds the consultant liable in the instance that he/she performs any action that intentionally or not, hurts the interest of the client during the term of the consulting agreement.
  • Termination Clause – This allows the client to prematurely terminate the contract if they are unsatisfied with the consultant’s work. In case of premature termination, they will have to pay the consultant for the hours worked, but will not have to pay for any unworked hours.

Drafting a Consulting Agreement with a Retainer

To help you draft a consulting agreement, we’ve come up with a template so that you can understand the ins-and-outs of drafting such a document. Additionally, we’ve also developed a retainer clause and attached it to the contract. If you don’t require a retainer, you can simply remove that section of the consulting agreement and move forward with the rest. The template can be modified easily by adding/removing clauses and stipulations that apply to you and can be found below;

Samples & Templates

CONSULTING AGREEMENT TEMPLATE (with Retainer)

CONSULTING AGREEMENT TEMPLATE (with Retainer)

This consulting agreement, dated __ (Date) is hereby enforceable upon signature from all of the contingent parties.

I. THE PARTIES

The parties include “The Consultant” (Consultant Name) with a mailing address located at _______________________________

(and)

“The Client” _ (Client Name) with a mailing address located at ___________________________________________________

Collectively, they will hereby be referred to as “The Parties.”

II. THE SERVICES

In the capacity of the role of consultant, The consultant agrees to provide the following services as requested by the client;

III. TERM

The Consulting Agreement is hereby scheduled to commence on _ (START DATE) and subsequently terminate on _ (END DATE). The agreement is enforceable and active upon signature from both parties.

IV. PAYMENT

For the services provided by the consultant, the client agrees to pay

(a) An hourly rate of $__/hr

(b) A total sum of $__ for the entirety of the term of the consulting agreement.

(c) Other _ (Please explain.)

V. DEPOSIT

(a) For the purposes of enlisting the consultant, the client agrees to pay a deposit of $__.

(b) The client and the consultant agree that there will be no deposit made before the commencement of the consulting agreement.

VI. RETAINER

The client agrees to enlist the services of the consultant on a retainer basis for _ amount of time. For this retainer, the client will pay; (a) A deposit of $_. Y__ N _ (b) An hourly rate of $_/hr.

(c) A total sum of $__ for the entirety of the project.

(d) Other __ (Please explain.)

VII. EXPENSES AND REIMBURSEMENT

In the capacity of the role of consultant, the consultant is hereby entitled to the following (Check the options that apply)

(a) Reimbursement for all expenses, including, but not limited to, travel, work-related expenses, supplies, equipment, operational expenses, payments to third parties that relate to the job on hand, insurance, and unemployment insurance.

(b) The consultant is not entitled to reimbursements.

VIII. ADDITIONAL CLAUSES

Here, the client and/or the consultant may insert any additional clauses that they believe are integral to their needs. Additionally, any other terms and conditions may be added here.

IX. THE AGREEMENT IN ITS ENTIRETY

The agreement explicitly detailed above hereby represents the entirety of the arrangement between the parties and hereby overrides any previous or existing agreement, contractual or not, that may have been in place prior to the signing of this contract. No additional clauses will be binding unless agreed upon by both parties.

The parties hereby agree to the aforementioned terms and conditions.

CLIENT NAME _

CLIENT SIGNATURE ________ DATE __

CONSULTANT NAME ___

CONSULTANT SIGNATURE DATE

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    FAQs

    What should be included in a consulting agreement?

    A consulting agreement should generally include the details of both parties, i.e., the client and the consultant, the services offered by the consultant, the term of the arrangement, payment-related specifics (amount, method of payment, schedule, etc.), terms and conditions, a retainer, if needed and any other additional clauses, such as non-disclosure, exclusivity, and right-to-terminate clauses.

    How do I terminate a consulting agreement?

    A client may insert a right to terminate clause, which gives them the ability to prematurely end the agreement if they are unsatisfied with the performance and abilities of the consultant. They will have to pay the consultant for hours worked, but will not have to pay the remainder of the amount. They may also be entitled to a complete refund if no work had been done.

    What is the purpose of a retainer?

    A retainer allows a client to hold on to the services offered by a consultant for extended periods of time. Typically, they pay the consultant in advance for an approximated number of hours. In some cases, they may also choose to pay a deposit at the start of the contract as a token of good faith, but that isn’t absolutely necessary. A retainer may be signed for any amount of time, but the general convention dictates that it is usually signed for a few months to a year. Clients may also add extra clauses, such as non-disclosure, indemnity, right-to-terminate, and exclusivity clauses, to further protect their interests.