Which is better? Terms & Conditions or a Client Agreement?

November 5, 2022

Here is a question that a client asked me to explain this week – and my answer, because I know it is a common area of confusion!

What is the difference between informed consent, terms of service, a client service agreement, and a contract? Is one better than the other? How do I know which one I need?

The quick answer is, they are all the same thing – sorta… read on to find out what the similarities and differences are, and how to decide which one is best for your needs.

Informed Consent

Informed consent means giving your clients enough information about your services for them to enter into working with you with their eyes open, knowing what to expect from you, what you expect from them, being aware of potential risks and understanding how to keep themselves safe.

Making informed consent a priority is best practice for every business owner. It is why we include disclaimers in our contracts, to avoid misunderstandings about the scope of your services, communicate your important boundaries, and ensure that your clients know what to do if they have concerns or experience problems.

It means you respect the client’s autonomy and right to make decisions knowing all of the important facts (not hiding risks or restrictive policies from them in order to make a sale, but ensuring the have a thorough understanding of the commitment they are making).

How does this relate to Contracts?

You provide that necessary information and collect your client’s informed consent in a contract, which could be in the form of Terms & Conditions or a Client Agreement.

As soon as you say “I do this thing” and your client says “yes, I want it, here’s my money” – that is a contract! The problem is, the terms of that contract may be unclear or confusing. Some might be in your head, some might be in the client’s, some might be in your sales page, some might be in your emails or Facebook messages. There is a lot of potential for miscommunication and misunderstanding.

I talk more about the three factors I use in deciding what level of contract is required in this blog: Suit of Armour or Flying Naked?

To put it in a nutshell, if it is an inexpensive, one-off, simple service with a low degree of risk, and you are quite confident in offering it, then that basic offer, acceptance & payment is likely to be sufficient.

However, the greater the investment in time and money, the greater the degree of risk or vulnerability and the more uncomfortable or anxious you are, the more important it is to provide the information required for informed consent in a way that makes it easy for the client to understand what they are agreeing to.

It is not all or nothing, though – there are degrees of contractual protection.

Terms & Conditions

Website Terms & Conditions, Terms of Service,  Terms of Purchase, Terms of Participation… these are all names for the type of contract that is generally short, sometimes sweet & almost always unilateral (meaning one-sided). That means they are set by the provider, and the client either accepts them or they don’t use the website, buy the product or book the appointment. It’s a “take it or leave it” kind of offer. 

There are a number of ways that terms might be provided for acceptance by the client – and I demonstrate them all right here on my website!

  • Website T&Cs are displayed in the footer of the website and act as a billboard, informing potential clients about what it is like to work with you. They are required under Australian Consumer Law to ensure that consumers have at least basic information about a seller or service provider before they make a purchase. Look down the bottom of this page to find mine (and yes, I used my own DIY Pack to create them!)
  • I have Terms of Purchase for my Contracts that Care DIY Packs. They are clearly linked above the BUY button. If you don’t like them, your only recourse is to go somewhere else and not buy my product. If you do buy, then you have accepted and are bound by the terms that were clearly displayed at the point of sale – you have given your informed consent and entered into a contract by making the purchase. I also post a copy of them out when I confirm your purchase, so you have a record of what you agreed to and can easily consult it if you need to.
  • The risk level with my consultations is slightly higher. As a result, I have built Terms of Service into my intake form. If you look at any of my consultation pages, you can see I have provided a link to the terms above the booking button for convenience, so you can read them in advance. Then, when you book in, you are asked to fill in an intake form. The last question on the intake form is a link to the same Terms of Service, and it says “Enter your initials if you have read and agree to my Terms of Service for this consultation – and please do read them!” (I find this gets more people to actually read them than the ubiquitous “tick the box” alternative.) By entering your initials, you are giving your informed consent and entering into a contract for the provision of that consultation, knowing what to expect. 

Terms & Conditions like these are most appropriate for the low to mid range of investment, risk & confidence (the three factors I describe in that blog I mentioned earlier.)

Client Agreements

Client Agreements or Service Agreements (or even Client Service Agreements) are the next level of contract – they still set out your terms & conditions, but they are generally a little bit more mutual, more comprehensive, possibly more personalised. For example, you might have a schedule with specific client details or specific inclusions for getting the most out of the service they have purchased. You might put a lot more detail in there to create a more thorough understanding between you and your client, to manage expectations around a more complex relationship. Often, you will want to get the client to sign the agreement, in order to have clear proof that they have given their informed consent. Client Service Agreements are generally used for offers that are in the mid to high range of investment, risk and confidence.

There is no hard line or distinction that shows where terms & conditions stop and contractual agreements begin. They blend into each other, as they are all shades of the same thing! The longer you stay in business, the more likely you are to need a full range of contracts.

You might have a comprehensive contract to manage the higher risk and greater discomfort that comes from working longer term, providing services to clients who are more vulnerable, or working with international clients where the risks and uncertainties are greater. You might also prefer to create simpler terms of service for single session consults, or use your website T&Cs to cover purchases of ebooks or simple evergreen programs.

Watch Your Language

One thing to remember is that neither terms and conditions or service agreements need to be forbidding and formal in their approach. You can make the language of both as gentle, caring, compassionate and connected as you like. An approach that is friendly and readable is going to be much more effective at obtaining your client’s informed consent, as they are more likely to read and understand it.

There’s no magic in legal jargon, and contracts do not need to be heavy handed – there’s usually a soft way to say what needs saying. Think about an individual client and imagine explaining a clause in your contract to them – that is often a good way to access the language you are looking for.

The best of both worlds

The client who inspired this blog has clients who regularly transition from a single session to a longer term more intensive working relationship, and she wanted to know if she could have simple terms appropriate to an initial consultation, while still keeping the protection of a  more comprehensive service agreement.

My answer was that you can definitely have both short Terms of Service available at the same time as a longer Service Agreement, so long as you are clear about what the client is agreeing to. You might word it something like this, for example –

“I have extracted my most important terms of service for you here on my intake form. Please tick the box to show you have read, understand and agree to them. More information about working with me can be found in my comprehensive Client Service Agreement, which I will ask you to read and accept if our relationship develops beyond a standalone session. Please contact me before proceeding if you have any questions or concerns.”

Inviting your clients to contact you is another way to prioritise informed consent, because you are giving them a clear opportunity to clarify any confusion they may have before they accept your terms.

How I can help

If this has inspired you to create terms and conditions or service agreements to manage your relationship with your clients, then my Contracts that Care DIY Packs are a great way to take ownership of your boundaries, prioritise informed consent and communicate your expectations clearly. If you don’t know what you need, book a free chat.

Would you like more helpful guidance on best practice for brilliant business owners?

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