5 Reasons You Need A Signed Contract

Handshake deals may feel like charming throwback to a simpler time, but unfortunately can leave you open to unnecessary risk and unfulfilled expectations. No matter how trustworthy the contractor, these 5 reasons show why no one should begin work until everyone has signed on the dotted line.

Contracts Ensure the Scope is Clear

Contracts keep everyone on the same page, including stakeholders– such as residents or tenants– who have a vested interest in the work. Formal written agreements provide an understanding for all of:

• the tasks the service provider is expected to perform;
• the timeframe for completion;
• the cost and payment schedule; and
• designated points-of-contact.

Contracts Hold Everyone Accountable

In addition to clarifying expectations, contracts can provide defined pathways for handling disputes. For example, in the event of unsatisfactory performance, your contract may contain mutually agreed-upon steps for remedying the issue from notification to resolution. 

Contracts Mitigate Risk

To protect you and your clients, it’s important any service provider you hire carry appropriate insurance for their activities, including general liability insurance, automobile liability insurance, and worker compensation. A contract should stipulate these policies remain in good standing for the duration of your agreement, along with the coverage levels required to give you adequate protection. 

Contracts Ensure the Work is Adequately Staffed

When a contract outlines the crewmembers, specialists, and equipment that will be dedicated to the job– you can be confident your work will be performed by qualified individuals and adequately staffed and resourced. This is crucial to service quality. 

Good Contractors Won’t Work Without a Contract

If a contractor insists a contract isn’t necessary, run! Good contractors know a contract is crucial for their own protection and yours. If they’re willing to skimp on this important step, what other corners might be cut? 

Requiring a contract for every service provider you hire doesn’t make you a stickler; it makes you smart. And if you’re still a fan of the handshake agreement, go ahead and shake on it anyway… just make sure you sign on it first.