Tips for a Better Work-for-Hire Contract

This guide for writers working in business, instructional, technical, and electronic media under work- for-hire contracts is adapted from other National Writers Union documents. In addition to educational information such as this guide and the "Guide to Freelance Rates and Standard Practice," members of the National Writers Union have access to one-on-one contract advice, assistance with grievances, seminars at reduced fees, and group benefits.

IT'S A CONTRACT

A contract is an agreement between two or more parties (two people, two companies, a person and a company) regarding what each promises to do in return for what the other promises to do. To have such an agreement, there must be a shared understanding of these promises - what the law books call "a meeting of minds."

Example

You want to write on teaching old dogs new tricks for the Dog Fanciers Web site. You and the Web site owner talk things over and agree that you and she want to do business. That in itself is not a contract. Then she offers to pay you $1200 in exchange for your content on the Web site for one year; you accept and promise to deliver the content in monthly installments. You now have an oral contract.

However, since people can remember oral contracts differently, they are harder to enforce than written contracts.

In fact, state law requires written contracts in many instances. For example, in most states any agreement involving a task that will take longer than a year to complete - writing a book, for instance - must be made in writing in order to be binding. In many states, written contracts are required if more than $5,000 is at stake. (Although if you didn't get it in writing and you are stiffed for more than $5,000, don't give up. You still have the right to fight for your money in court.)

There are many types of writing contracts, each specifying working relationships between writer and client. Some contracts are negotiated directly with an employer, either as a temporary employee, an independent contractor, or a vendor. Other contracts are indirect agreements that involve a temporary agency, a staffing firm, or a broker as a third-party intermediary between the writer and the ultimate client.

RIGHTS AND WORK-FOR-HIRE

In a typical magazine or book contract, a writer negotiates with a publisher over uses the publisher may make of the writer's work. The many different ways a work might be used are called rights. The writer owns, controls and licenses the rights to the publisher, and a publisher who uses the work in unlicensed ways may be committing copyright infringement.

BITE writers typically have a different kind of agreement called a "work-for-hire" contract. When a writer works under a work-for-hire agreement, he or she gets paid a fee but has no ownership or control over the writing.

There are several provisos regarding work for hire. The two most important are:

  1. THE COPYRIGHT LAW REQUIRES A WRITTEN CONTRACT that specifically states that the work is a "work-for-hire." If that phrase is omitted in a written contract, the copyright to any work, regardless of the type, belongs to the writer.
  2. ONLY CERTAIN TYPES OF WRITING BY FREELANCERS AND INDEPENDENT CONTRACTORS MAY BE WORKS FOR HIRE. Examples include writing that contributes to a larger work, such as a computer manual or a section of a textbook. If the work is not one of the types specified in the Copyright Act, then it is not a work for hire, no matter what the written contract says.

Works created by full-time staff writers are also works-for-hire. In these cases, the employer owns and controls the copyright.

CONTENT OF A WRITING CONTRACT

A contract should describe certain critical aspects of the agreement, especially the rights and obligations of each party. Typical writing contracts include clauses that cover the following:

  • WHO: Who are the participants in this contract?
  • WHAT: What is being exchanged under this contract? What are the terms of the exchange?
  • WHEN: Over what time period is the contract in effect? When is the work to be completed? When will the writer be paid?
  • RIGHTS: Is it a work-for-hire contract? If not, what rights are being assigned?
  • COMPENSATION: How much will the writer be paid? What expenses will be covered?
  • TERMINATION: How can this contract be ended before the completion date?
  • WARRANTY & INDEMNIFICATION: Will the client take responsibility for his or her part in the product in the event of a lawsuit?
  • DISPUTES: How will disputes among the parties to this contract be settled?

Many work-for-hire writing contracts also include clauses that cover these terms:

  • MODE OF EMPLOYMENT: Is the writer a temp, a contractor, a vendor?
  • SUPERVISION: To whom is the writer responsible? How closely will the writer be supervised?
  • REPORTING: Will the writer submit time sheets? What reports must the writer make?
  • NONDISCLOSURE: What is the writer required to keep secret? For how long?
  • NONCOMPETE: Are there any limitations to the writer working for other companies? If so, do these limitations apply only to the period of the contract, or do they continue for a specified time after the contract ends?
  • CHANGES: What happens when either the writer or the client wants to change the work assignment?
  • ACCESS: How much access will the writer have to company information and systems?
  • PORTFOLIO: Will the writer be allowed to include his or her work in his/her portfolio?

NEGOTIATING

In some cultures, it is considered rude or foolish not to bargain in the marketplace but in the United States we are not used to bargaining. You are unlikely to get the manager of your local supermarket to come down on the price of frozen peas. But even in this culture, no self-respecting businessperson accepts the first bid offered.

Writers, like other people, often feel uncomfortable with negotiating. We may fear that if we ask for a higher fee or better terms, we will be passed up in favor of the next writer in line. As a negotiating posture, that kind of passivity is likely to get you a poor deal.

Actually, the demand for writers in the U.S. is strong, especially for those working in typical work-for-hire fields like technical and business writing. In some parts of the country, employers compete for experienced writers while new writers find it easier to break into the market than in past times. That gives us grounds for confidence that we can indeed negotiate the contract terms we want. Since demand for writers has risen and fallen over past years, negotiating could be tougher in the future. Now is a good time to hone our contract negotiating skills.

When You Have Your Greatest Negotiating Power

The moment when a publisher or client offers you a contract is the pinnacle of your power in the relationship. The employer is saying that you have something he or she wants. That is your moment to say what you want in return.

Start with Your Own Contract

Ideally, you will open the discussion by presenting your own written contract spelling out your terms for the agreement. It is rare, though, for the writer to be the one who furnishes the contract. Usually, the employer's contract serves as the starting point.

Read the Entire Contract

Don't sign until you are clear on all aspects and are satisfied with the contract's terms. If you find parts of the contract that are unclear, wrong, or not in your interest, or if important issues are not covered, note them, and negotiate with the person with whom you are working.

Negotiate Professionally

Negotiating does not have to be bellicose. A lot can be accomplished through a calm exchange of positions, wishes, and needs. The long-term goal of the negotiations is a productive, ongoing working relationship based on a contract that provides advantages for all involved.

There Are No Nonnegotiable Contracts

Sometimes an employer tells you a contract is nonnegotiable. That is a bargaining stance. All contracts are negotiable to some degree. It is up to you to find the negotiable points and to exploit them to your advantage. When someone tells you a contract is nonnegotiable, he or she is simply saying, "I don't want to change this contract."

If you can fulfill what the client needs, the "it's nonnegotiable" stance is likely to weaken when you express your disagreement. It is not uncommon for employers, especially large ones, to have more than one "nonnegotiable" contract. The first and worst is for the "pushovers." A second is for the "whiners." Another is the "golden deal" for writers who won't work for less.

Know What You Want and Be Prepared

The real trick to negotiating is a carefully thought-out strategy. Consider what you want out of the deal. Then divide your wishes into categories based on desirability. For instance, you could look at the various provisions of a contract as:

  • The things you absolutely cannot live with.
  • The things you absolutely cannot live without.
  • The things you would like, but can give up without much pain.
  • The things you would give up only in exchange for something else.

Approach negotiations with a series of demands and fallback positions. The goal is to get as much of what you want as possible, but not to back the other party into a corner where their only out is to break off negotiations. It is important to be realistic and prepared. On the one hand, do not make wild demands. On the other, don't give up easily what you really need to make the deal work for you. Be firm about the things you definitely want. By approaching negotiations in a professional, thoughtful way, you will make better deals.

Be Sure Side Agreements Are Enforceable

Sometimes an editor is not willing to change the company's contract but will agree to changes or additional terms in a separate memo or an email. Such a side agreement, also called a side letter, can be a helpful tool to get what you need. However, take care to be sure the agreement is enforceable. Some contracts forbid side agreements with language such as, "This contract constitutes the full and complete understanding ...." In that case a side agreement is not legally binding on the company.

Don't Commit Until You're Ready

Finally, be sure you are in the right state of mind when you negotiate. If someone takes you off guard by calling unexpectedly, say you are occupied and will call back in ten minutes. Use that time to breathe, look in the mirror, go over your negotiating points, and gush to your cat about how excited you are to get the offer. Then call back on time, feeling steady and prepared to talk.

TIPS TO NEGOTIATE A BETTER DEAL

Remind yourself that all contracts are negotiable.

Read the whole contract before you sign.

Present your own contract first whenever possible.

If you are an NWU member, ask a union contract advisor to review the contract with you.

Ask the client questions about sections of the contract that you don't understand. Ask for examples of how these sections will apply to you.

Remember that your strongest negotiating moment is when someone commits to hire you or use your writing.

Negotiate with your feet on the ground. Take a break and call back if necessary.

Be knowledgeable but not obnoxious when you negotiate.

Start a little high because it's easier to negotiate down than it is up.

Stop talking after you say what you want. Let the other person respond.

Be sure that a "side agreement" made with an editor is enforceable.

FOR MORE INFORMATION

Members of the National Writers Union can have contracts reviewed by specialists in their genres, including work-for-hire contracts. The union has guides to many kinds of writing contracts.

Your local library and bookstore will have many books on negotiating skills.
Sunday, July 06, 2008 1:03 pm