Terms of business, and what changes by profession

The name matters less than you think

Three phrases do most of the work here, and people use them interchangeably. Two of them genuinely are interchangeable.

Terms of business is the professional services phrase. Accountants, consultants, recruiters and agencies tend to use it, because the document governs an engagement rather than a sale. Terms and conditions is the broader commercial phrase and covers the same ground, plus selling goods. Either is fine. Nothing turns on the choice.

Terms of service is different now. It has drifted to mean a licence to use a platform - search it and you get Google, WhatsApp and the app stores. If you sell software or run a subscription, it is the right word. If you sell your time and judgment, it quietly tells the reader they are a user rather than a client, and it is worth avoiding for that reason alone.

So the naming question is easy. The harder question is what goes in them, and the honest answer is that it depends on what you sell.

What changes by profession

Every set of terms should cover the same skeleton - what you are doing, what it costs, who carries which risk, how it ends. Below that, each profession has one or two clauses which decide most of its disputes. These are the ones a borrowed document is usually missing.

1. Accountants. Scope, and who is allowed to rely on your work. Most complaints are some version of "you should have spotted that", which is an argument about what you were retained to do - so the scope schedule is the clause doing the real work. Alongside it, a clear statement that the accounts are prepared for the client and not for their bank, their buyer or an investor. Without it, people you have never met can end up treating your work as advice to them.
2. Consultants. Deliverables, not outcomes. The risk is being judged on a result you never promised, so terms should say what you will produce and by when, and stop short of promising what it will achieve. Worth adding: whether the client may share your report outside their business, because a report written for one board reads very differently in someone else's due diligence.
3. Recruiters. What counts as an introduction, and how long it lasts. The whole commercial model rests on it. Define the introduction, set the period it covers, say what happens if the candidate is passed to a group company or a client of the client, and set out the rebate position if a placement does not stick. Terms which are vague here do not produce disputes so much as unpaid invoices.
4. Marketing, design and creative agencies. Ownership and approvals. Who owns the work, and from when - our position until paid is the sensible default, and it needs saying. Then approvals: get sign-off in writing, because "we approved that" is the entire argument when a campaign underperforms. And third-party licences for stock, fonts and music, which is a risk agencies routinely carry without realising.
5. IT and software services. Service levels and data. Say what available means, how it is measured, and what actually happens when you miss it - a service credit is a remedy, an apology is not. Then set out who is controller and who is processor for personal data, because getting that label wrong reallocates a set of statutory duties neither side has priced.
6. Contractors and construction. Variations and payment, with a warning. Work changes on site, and if variations are not priced in writing you are arguing about a conversation. Payment is the unusual bit: for most construction contracts the statutory payment regime overrides whatever your terms say, including the notices each side has to serve and the deadlines for them. You cannot draft your way out of it, so terms should be written to sit inside it rather than against it.
7. Architects, engineers and other insured professionals. The cap and the share. Tie your liability cap to the cover you actually hold, rather than to a figure someone picked years ago, and consider a net contribution clause so you carry your share of a problem and not everybody else's. On a project with several consultants, that clause is frequently the difference between a claim and a catastrophe.
8. Insurance brokers, training providers and suppliers. The pattern repeats. Brokers need scope and regulatory boundaries stated plainly. Training providers need cancellation and rescheduling terms, because empty rooms still cost money. Suppliers need delivery, title, risk and what happens when a customer will not accept goods.

The mistake which beats all of these

You can get every clause above right and still be unprotected, because of when the terms arrive.

Terms which go out with the invoice were not agreed. The contract was formed earlier - when the client accepted your quote or told you to start - and your terms turned up afterwards. At the moment you need them, they are not part of the deal. The same goes for a link nobody had to click through, and for the situation where you signed their purchase order and they never signed anything of yours.

This is the most common problem I see, and it is the cheapest to fix. Send the terms with the proposal, refer to them in it, and get something back before work starts. A tick box is enough. An email saying "happy to proceed on your terms" is enough. Nothing at all is not.

When to look at them again

Annually is a reasonable rhythm, but the real trigger is a change in the business rather than a date in the diary. Worth a look whenever you add a service line, take a first consumer or overseas client, step up in contract size, start subcontracting, or handle a claim your terms dealt with badly.

If you cannot remember what your liability cap is, that is also a trigger. Terms you cannot summarise from memory are terms you are not relying on.

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