Negotiate a contract

Good preparation is essential for successful negotiation. It’ll give you more confidence to negotiate and improve your chances of getting an outcome that works for you.

Learn about the hirer's business before you begin negotiations. Their website is a good place to start.

• What does the hirer produce?
• Who is their market?
• What are their strengths and weaknesses?

Make sure you have a clear idea of what you want from the contract.

Be mindful of the way you present yourself and your business during negotiations, and be respectful towards the hirer.

Being business-like in your approach helps to build and maintain good business relationships. It’ll also help you and the hirer address potential problems before they arise.

Contracting arrangements are governed by commercial and contract law, not by employment law. This means that you and the hirer are free to choose the terms of your contract within the limits of the law. However, a court may be able to set aside a contract if it is considered to be 'harsh' or 'unfair'.

A well-drafted contract is an important risk management tool for your business. It should clearly and accurately reflect what you and the hirer have agreed and exactly what you expect from each other.

If you cannot agree about a matter, you may need to discuss it in more detail to better understand each other's point of view. If you’re not comfortable with a part or a word in the contract, then don't sign it.

Don’t enter into a contract hoping to sort it out later. Once it’s signed, the terms will be legally binding. A dispute is less likely if you and the hirer are happy with the terms of a contract from the start.

It’s good practice to take notes of all the negotiations and discussions you have with the hirer and record the dates. This should be done both before and after you sign the contract. If the contract has started, any discussions that change the terms of the agreement become either a:

• variation to the contract
• a new, separate contract (depending on the content)

You should attach a copy of the agreed changes (or, for example, an email that confirms you both agree to the changes) to the original contract.

Get advice before you sign a contract if you are unsure about the meaning of any terms, or what you're agreeing to. It can be too late to fix or change a contract once it's signed. Consider contacting:

• a business adviser
• your local Business Enterprise Centre
• your union or professional association
• a lawyer.

A lawyer can also review your contract to make sure it is legally enforceable.

If English isn’t your first language, it may be better to negotiate the terms of your contract with the hirer in your own language. You may also need help understanding the language used in the contract. Consider speaking to the hirer through an interpreter or paying for the contract to be translated by an accredited translator.

There are various resources you can use to help improve your negotiation skills, such as:

• your local Business Enterprise Centre - to find out about workshops in your area
• your local TAFE college - to see if they offer negotiation skills or small business management training
• reading books - about negotiating in business.