12 Red Flags in a Freelance Contract
Client contracts are written by the client's lawyer to protect the client. That is not malice, it is their job. Your job is to spot the terms that shift ordinary business risk onto you and ask for the standard fix.
Here are the twelve that show up most often, in rough order of how much money they can cost you.
Payment red flags
- Payment on "client acceptance" with no definition of acceptance — ask for deemed acceptance after a set number of days without written objection.
- Pay-when-paid, where you are paid only if their end customer pays. Ask for a backstop date regardless.
- Net 60 or Net 90 terms on a small project. Counter with Net 14 or Net 30 plus a deposit.
- No late-payment remedy. Add 1.5% monthly interest and the right to suspend work.
- Broad set-off rights letting them deduct unrelated claims from your invoice.
Scope red flags
- Unlimited revisions, or "revisions until client is satisfied". Cap them: two rounds included, further rounds at your hourly rate.
- "And other duties as required" appended to a defined deliverable list — strike it or bound it with a change-order clause.
- Deadlines binding on you but not on the client's feedback. Add a clause pausing your dates when their input is late.
Ownership and rights red flags
- Work-for-hire language covering everything you produce during the engagement, including work for other clients. Limit it to the deliverables.
- IP transfer on delivery rather than on payment. Change it — this is your leverage if the invoice goes unpaid.
- No carve-out for your pre-existing tools, templates and libraries. Add one, licensed rather than assigned.
- A portfolio ban with no compensation. Either keep display rights, or price the confidentiality.
Liability red flags
An uncapped indemnity on a $5,000 project is the clearest sign the contract was not sized for the deal. Ask for liability capped at fees paid, exclusion of consequential damages, and a mutual indemnity limited to your own negligence and IP infringement.
Requirements to carry professional liability insurance at levels that cost more than the project profit are also worth flagging early rather than discovering at invoice time.
How to raise these without losing the client
Do not send back a marked-up document with twenty changes. Pick the three that matter — payment trigger, liability cap, IP on payment — and put them in a short email as commercial points rather than legal objections.
"Happy to sign; two things I need to adjust so this works on my side" gets a yes far more often than a redline attachment with no explanation.
Run it through the checker before you sign
Upload the contract and get a 0-100 risk score, a plain-English list of the clauses that work against you, and suggested wording to send back.
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LegalAIContracts provides document automation and AI analysis, not legal advice. Professional review is advisable for high-value or unusual agreements.