FREELANCE CONTRACT FOR SERVICES
This agreement (hereinafter the "Agreement") has been entered into in [City where the contract is signed] on [Contract date] between the following parties:
1. PARTIES
1.1 Client:
[Client's name]
Commercial Register code: [Client's Commercial Register code (if a company)]
(hereinafter the "Client")
1.2 Freelancer:
[Freelancer's name]
Personal identification code / Commercial Register code: [Freelancer's personal identification code or Commercial Register code]
Status: [Freelancer's status]
(hereinafter the "Freelancer")
2. TYPE OF AGREEMENT AND INDEPENDENCE
2.1 This agreement is a CONTRACT FOR WORK (Law of Obligations Act (VÕS) § 635 et seq.) — the Freelancer undertakes to achieve the result described in clause 3 and is liable for its conformity with the terms of the Agreement. The Client may terminate the Agreement at any time; in that case, the Freelancer is entitled to the agreed fee less what it saved as a result of the termination of the contract or what it acquired or could reasonably have acquired by using its labour otherwise (VÕS § 655 (1)).
2.2 This agreement is not an employment contract and the Parties do not thereby create an employment relationship. The Freelancer decides independently on the manner, time and place of performing the Works or the service, uses its own work equipment unless the Parties have agreed otherwise, bears the risk associated with its own economic activity and may at the same time provide services to other persons. The provisions concerning employment contracts do not apply to a contract under which the person obliged to perform work is independent to a significant extent in choosing the manner, time and place of performing the work (Employment Contracts Act (TLS) § 1 (4)).
3. SCOPE OF THE WORKS/SERVICE
3.1 Description: [Description of the works/service]. Deliverables and acceptance criteria: [Deliverables].
3.2 The Freelancer performs the Works or provides the service in accordance with the Agreement, the legislation applicable to works of that type and good practices recognised in its economic and professional activity, and at least with the average quality customary for works of that type.
3.3 The Client has the right to monitor the progress of the Works or the provision of the service on an ongoing basis and the Freelancer provides the information necessary for this. In doing so, the Client does not give the Freelancer instructions concerning its working time or work organisation.
3.4 The Freelancer notifies the Client of the completion of the Work and hands over the deliverable. The Client inspects the deliverable and notifies the Freelancer of defects within a reasonable time, describing them as precisely as possible. If the Client unjustifiably fails to accept the Work within a reasonable term granted to it for that purpose by the Freelancer, the Work is deemed accepted (VÕS § 638).
3.5 The Client provides the Freelancer in good time with the information, materials and access necessary for the Works or the service. If the Client is in delay with this, the Freelancer's deadlines are extended by the period of the delay.
4. SCHEDULE
4.1 Start date: [Start date]. Termination: [Termination]. End date: [End date].
5. FEE AND PAYMENT
5.1 Type of fee: [Type of fee]; amount: [Amount of the fee (€)] euros. Estimated number of hours: [Estimated number of hours (recommended for an hourly rate)]. Together with the invoice, the Freelancer submits an overview of the work performed and the hours spent on it (timesheet).
5.2 Payment deadline: [Payment deadline]. Invoicing frequency: [Invoicing frequency]. Number of free revisions: [Number of free revisions (if applicable)].
5.3 Works or services falling outside the scope described in clause 3.1 are performed and paid for only by prior agreement of the Parties, made in writing or in a format which can be reproduced in writing.
5.4 If the payment deadline is exceeded, the Freelancer may claim late interest at the statutory rate (VÕS § 113 (1)).
6. TAXATION
6.1 The Freelancer is a private individual (not acting as a sole proprietor). The fee referred to in clause 5.1 is a gross fee. If the Client is a resident legal person or a sole proprietor (Income Tax Act (TuMS) § 40 (1)), it must, by law, withhold income tax, the unemployment insurance premium and the mandatory funded pension contribution from the fee and pay social tax and the payer's unemployment insurance premium on the fee. The basic exemption is applied only on the basis of a written application by the Freelancer. This obligation arises from the law, not from an agreement of the Parties.
7. INTELLECTUAL PROPERTY
7.1 Ownership of intellectual property: [Ownership of intellectual property]. The Freelancer's prior/existing intellectual property (e.g. its own tools, frameworks) remains with the Freelancer unless otherwise agreed. The Client has a free, perpetual non-exclusive licence to use the Freelancer's prior intellectual property incorporated into the result for the purpose of using the result.
7.2 The author's economic rights in works created as a result of the Works or the service are transferred to the Client in full, without territorial restriction and for the entire term of copyright. The Client has the right to modify, adapt, process and distribute the result and to grant sub-licences.
7.3 The moral rights of the author are inseparable from the person of the author and are not transferable (Copyright Act (AutÕS) § 11 (2)); the Freelancer does not exercise them in a manner that prevents the use of the rights belonging to or granted to the Client. An agreement on the transfer of the author's economic rights must be in writing (AutÕS § 49 (1)). As the Freelancer is not an employee of the Client, the economic rights are not transferred to the Client by law (AutÕS § 32), but only on the basis of the Agreement.
7.4 The Freelancer confirms that the result is its own creation and, to its knowledge, does not infringe the rights of third parties. When elements belonging to third parties (e.g. fonts, photographs, software components) are used, their licence terms are complied with and the Freelancer discloses those elements to the Client.
8. USE OF SUBCONTRACTORS AND ASSISTANTS
8.1 Use of subcontractors/assistants: [Is the use of subcontractors/assistants permitted?]. The Freelancer is liable for the activities of subcontractors and assistants as for its own activities and ensures that they comply with the confidentiality and intellectual property terms of the Agreement.
9. CONFIDENTIALITY AND DATA PROTECTION
9.1 Statutory confidentiality obligations apply in any case. A separate confidentiality obligation applies: [Does a confidentiality obligation apply?]. The Parties do not disclose the content of the Agreement or other information that has become known in the course of performing the Agreement and that may reasonably be considered confidential to third parties without the written consent of the other Party, except in the cases provided by legislation; the obligation also applies after the termination of the Agreement.
9.2 In the case of an authorisation agreement, the Freelancer is in any case required by law to keep confidential the circumstances which the Client has a legitimate interest in keeping confidential, also after the termination of the Agreement to the extent necessary (VÕS § 625).
9.3 If the Freelancer processes personal data on behalf of the Client in the course of performing the Agreement, it does so only in accordance with the Client's instructions and for the performance of the Agreement, and the Parties enter into, where necessary, a data processing agreement (Article 28 of the General Data Protection Regulation (EU) 2016/679).
10. TERMINATION OF THE AGREEMENT
10.1 Notice period for ordinary termination: [Notice period for termination].
10.2 Clause 2.1 applies to the Client's right of termination. In the event of termination by the Freelancer, the Freelancer is entitled to a fee for the work performed to the extent that the Client has an interest in what has been done. Either Party may withdraw from the Agreement if the other Party has materially breached the Agreement (VÕS § 116).
10.3 Upon termination of the Agreement, the Freelancer hands over to the Client the results of the work performed and the Client's materials, and the Client pays for the works properly performed or the service properly provided by the time of termination of the Agreement.
11. WARNING ON DISGUISED EMPLOYMENT
11.1 If a person performs work for another person, being subject to the management and supervision of that person, the contract is an employment contract (TLS § 1 (1)). If, under the circumstances, the work can be expected to be performed only for remuneration, the contract is presumed to be an employment contract (TLS § 1 (2)), unless the person performing the work is independent to a significant extent in choosing the manner, time and place of performing the work (TLS § 1 (4)). If the actual organisation of work corresponds to the characteristics of an employment contract (fixed working time, a place of work determined by the Client, a continuous relationship of subordination and an obligation to follow instructions), a court, a labour dispute committee or the Estonian Tax and Customs Board may deem the relationship to be an employment contract regardless of the title or wording of the Agreement. The Parties ensure that the actual organisation of work corresponds to the nature of the chosen type of contract.
12. FORCE MAJEURE
12.1 A breach of obligations arising from the Agreement is excused if a Party breached the obligation due to force majeure, i.e. a circumstance which it could not influence and, based on the principle of reasonableness, it could not be expected to take into account at the time of conclusion of the Agreement, or to avoid or overcome the consequence thereof (VÕS § 103).
12.2 A Party whose performance of an obligation is prevented by force majeure notifies the other Party thereof immediately. If the effect of force majeure is temporary, the breach is excused only for the period during which force majeure prevented the performance of the obligation (VÕS § 103 (3)), and the deadlines arising from the Agreement are extended by that period.
13. NOTICES
13.1 Notices related to the Agreement which have legal consequences are submitted to the other Party in writing or in a format which can be reproduced in writing (including by e-mail) to the address which the Party has communicated in writing to the other Party upon conclusion of the Agreement or later.
13.2 Notices of a purely informative nature may also be given by telephone. A Party notifies the other Party immediately of any change in its contact details; until the notice is received, the previously communicated details are deemed valid.
14. DISPUTE RESOLUTION AND APPLICABLE LAW
14.1 Disputes arising from the Agreement are resolved primarily by negotiation; if no agreement is reached, the dispute is resolved in court in accordance with the procedure provided by law.
14.2 The Agreement is governed by the law of [Governing law].
15. FINAL PROVISIONS
15.1 Amendments and supplements to the Agreement are made in writing or in a format which can be reproduced in writing and enter into force once both Parties have confirmed them.
15.2 A Party may not transfer rights and obligations arising from the Agreement to a third party without the prior written consent of the other Party.
15.3 If any provision of the Agreement is or becomes invalid, this does not affect the validity of the remaining provisions. The Parties replace the invalid provision with a valid one that is as close as possible to it in its economic substance.
15.4 The Agreement (together with its annexes) constitutes the entire agreement between the Parties and supersedes all prior oral and written agreements relating to the subject matter of the Agreement. The Agreement enters into force once both Parties have signed it.
16. LEGAL BASIS
16.1 The Agreement is governed by the provisions of the Law of Obligations Act on contracts for work (§§ 635–657) and the general part of the Law of Obligations Act; in respect of works created, also by the Copyright Act.