Service Agreement

What is a service agreement contract?

A service agreement is a legally binding contract that sets out the scope of services, key terms, and responsibilities of both the service provider and the client. This is a popular contract template in Australia that provides a solid legal framework for the provision of various types of services. The typical contract of services template defines:

• details of the parties involved;
• scope of services;
• duration of the provision of services;
• termination of the contract;
• mutual parties’ rights and obligations;
• limitation of liability; and
• applicable law.

It helps protect both parties by clearly defining service delivery expectations, payment terms, and dispute resolution processes, reducing the risk of misunderstandings and legal issues.

What is the difference between a service agreement and an employment agreement in Australia?

At first glance, both documents may seem similar, and this is partially true. Both documents involve engaging a person for the performance of a certain type of work in exchange for payment. However, this is only superficial understanding. In reality, the two types of documents differ on numerous criteria, including:

• Parties involved. Under an employment contract, a business or company hires an individual to perform work. In contrast, a services agreement can involve work performed either by a company, solo trader or individual.
• Relationships. The contract for services template establishes an equal relationship between the service provider and the client. In other words, the service provider shall perform work or provide services according to the agreed scope and timeline. However, the client cannot dictate how the work should be carried out. Contrary to that, the employment contract stands for the relations of subordination.
• Remuneration. The service provider in a contract for services template is being paid for the provision of services or work done in full or per milestone, meaning the client pays for the result. For example, the service provider shall provide the legal advice or tax consultation, complete tax filing, or repair a vehicle. The worker in the employment contract is being paid regardless of the result of their work. For example, even when an employee is on sick leave, the company shall still pay the employee’s salary.
• Termination. The parties to a service contract agreement template in Australia can agree on the exact list of circumstances in which the contract shall end. Termination of the employment contract is not an easy task and must comply with the Fair Work Act. The company cannot simply end the employment contract at will.
• Benefits and Entitlements. Under the employment contract, employees enjoy a wide range of additional benefits provided by applicable state or territory legislation, awards, or enterprise agreements. Those benefits include paid sick leave, paid annual leave, pension contributions, etc. However, these benefits are not paid under a service agreement.

Who needs this service agreement template?

A service agreement sample is one of the most commonly used legal templates in Australia that is being used widely in daily life and business situations. A solid sample service contract template can be helpful for:

• individuals who want to engage professional services and need to properly secure their rights under a contract;
• small business owners who do not have in-house legal teams and require a professional services contract for daily operations;
• freelancers and independent contractors seeking a solid sample contract for services to engage new clients.

What to include in a sample service agreement in Australia?

Australian law provides a robust framework for regulating contract of services templates in Australia. A well-drafted contract template shall align with applicable federal, state and territory consumer, competition and fair work legislation. While Australian law does not prescribe a service contract agreement format, the inclusion of certain clauses remains essential. These clauses ensure both the document’s clarity and legal validity.

Below, there is a summary of the most important elements every service agreement template in Australia must have.

Description of Services

This is the first and most important pillar for any contracts for services template. This section of every contract must answer three key questions:

• What? The text of a services agreement must explain in detail services that are being provided. If the description is too long, a separate annexure could be attached to the contract.
• When? The service provider should be able to understand the exact timeline according to which services shall be performed. In particular, each sample service agreement must define the commencement date, the completion date, and, here relevant, the list of milestones according to which services shall be delivered to the client.
• How? Every service agreement template shall outline exactly how services must be provided, including (i) whether subcontracting is permitted; (ii) whether the service provider is required to supply any equipment; (iii) whether the service provider is required to supply any materials; (iv) whether particular professionals should be engaged in the provision of the services (this is especially important for highly qualified services like legal, accounting, architectural, etc.).

Identification Details of Parties

The parties to a sample service agreement are a client and a service provider. Thus, the text of a final document must include the following details:

• full legal name (if a party is a company or business) or name;
• registered business or mailing address;
• ACN or ABN number (if a party is a company or business);
• Contact email and phone number.

Each party must sign and date the document. The document must be signed in two copies, one copy for each party to keep for further record.

Obligations of Service Provider

• Compliance with Laws. Under the contract for services template Australia, the service provider must fully comply with all applicable legislation and regulations in the process of the provision of services. Moreover, the service provider shall indemnify the client against all possible and future claims that may arise due to violation of applicable laws by the service provider.
• Quality of Services. Unless otherwise stated, the service provider must deliver services to a standard consistent with generally accepted industry practices.
• Confidentiality. The service provider must keep confidential all information provided by the client for the purpose of the provision of services under this contract. It means that the service provider shall refrain during the whole duration of the contract, and for a certain time after its termination, from disclosing the client’s sensitive information. In Australia, the standard post-termination non-disclosure period amounts to a maximum of 3 calendar years.

Service Fees

Another important element of a sample service agreement contract is the inclusion of the service provider’s compensation. The parties are free to choose any payment model they prefer. In fact, the services contract in Australia shall define:

• the amount of fees in Australian dollars, exclusive of GST (for example, hourly rate, weekly or daily rate, fee per project or fee per milestone);
• invoicing frequency (for example, every week, upon completion of the project);
• accepted payment methods (for example, cash).

Governing Law

Every sample service agreement shall also contain the reference to applicable state or territory law that will apply to the interpretation, execution and termination of the present contract. This is usually the law of a state or territory where services are actually provided, or a place where either party to the contract is placed or doing its business.

Termination

Last but not least, an important component of a solid sample service agreement template is the termination clause. This section of a contract defines how and when either party can end the agreement in a legally compliant way. That’s why the parties to this agreement must define:

• list of circumstances upon occurrence of which the service provider can end the contract (for example, unpaid fees);
• list of circumstances upon occurrence of which the client can end the contract (for example, breach of confidentiality);
• events that result in immediate termination (for example, the service provider loses the licence required for the provision of certain services in Australia); and
• notice period (this is a period of time in which one party shall notify the other party about the contract’s termination).

Why choose FasterDraft for a customisable service agreement contract?

Among the many online platforms offering customisable legal documents, FasterDraft stands out for the following reasons:

• You get a contract for services agreement created by legal professionals and never by AI;
• The document that is fully customisable for your particular situation and needs;
• The service contract template is fully compliant with Australian law, including the Independent Contractor Act, the Fair Work Act, and other relevant legislation.
• The document is written in clean and plain English for everyone to understand.
• The template is a well-structured contract and follows best contractual standards in Australia.
• The final documents are available in both PDF and Word formats.
• Thee template is customisable with the local regulations of all six states and to territories across Australia.
• The entire process takes up to 5 minutes.

How to customise this service agreement template with FasterDraft?

To get a fully customisable service contract template, follow the instructions given below:

1. Click the “Create Document” button.
2. Answer simple questions in the form.
3. Select a service contract agreement format – PDF or Word.
4. E-sign the document for free.
5. Make a payment.

Download instantly your customisable service sample agreement.