A freelance contract often feels like a quick, flexible solution: you download a template from the internet, fill in your name and rate, and get started. That is precisely where the risk lies. Innocent-looking phrases can have major consequences: bogus self-employment due to overly strict management (DBA Act), unclear scope with endless extra work, loss or uncertainty about intellectual property, unilateral liability without a ceiling, payment terms of 60 or 90 days, or a termination clause that makes early termination impossible. The result: discussions, stalled projects and costs that you could have avoided.
In this article, we list the tempting pitfalls of a freelance contract, always with: why this is risky, signs and red flags, which provisions you do want to include or change, and practical tips. All examples are based on Dutch law and hiring and assignment practices. This allows you to sign, make adjustments or seek legal advice in good time with confidence. Ready for the first check? Then let’s start with preventive contract review.
1. Have your freelance contract reviewed preventively by Law & More
A quick contract scan allows you to eliminate the biggest risks before you start—practical, concrete and often cheaper than litigation afterwards.
Why this is a pitfall
Model agreements and good intentions often mask the tempting pitfalls of a freelance contract: bogus self-employment (Wet DBA), unclear scope, missed IP transfer, unilateral liability and unworkable termination or payment agreements.
Signals and red flags
Phrases that require personal labour or give extensive right of instruction; no replacement clause; missing IP transfer; vague deliverables; payment terms of 60+ days; no possibility of interim termination or exit.
Provisions to include or amend
Replacement clause or non-authoritative wording (DBA-proof), IP transfer/licence, clear scope and acceptance criteria, liability limit with cap, reasonable termination and exit arrangements, payment within 14–30 days and (partial) advance payment.
Practical tips
Have Law & More review the agreement before you start, record the actual collaboration (DBA), send your changes in track changes and schedule a free introductory meeting to determine priorities.
2. Bogus self-employment: authority relationship, personal labour and the DBA Act
False self-employment arises when wages, personal labour and authority come together. Under the DBA Act, the actual implementation carries more weight than the text.
Why this is a pitfall
This is one of the tempting pitfalls of a freelance contract. The impact is significant: additional wage tax and contributions, fines and loss of entrepreneur’s allowance. Labour law protection may also still apply.
Signs and red flags
Red flags: mandatory personal commitment, no replacement, fixed working hours or attendance. Mandatory work instructions, leave or sick leave procedures and use of company accounts as an employee.
Provisions to include or amend
Include a substitution clause (freely replaceable). Lay down results and quality agreements without employer authority, without working hours, and emphasise independence.
Practical tips
Ensure that the paperwork and practice match: grant autonomy, invoice in your own name, no leave requests or company ID. Use model provisions from the Tax and Customs Administration as a basis, but tailor them to your specific situation.
3. Unclear job description: scope, deliverables and additional work
If the assignment is vague, the work will slip unnoticed and hours and expectations will get out of step. Especially with a fixed price, discussions about ‘what is included’ can quickly arise. This is one of the tempting pitfalls of a freelance contract: a lack of framework leads to disputes about additional work and invoice stress.
Why this is a pitfall
Without a clear scope and end result, parties spend time on the wrong activities, especially with fixed prices. Expenses and revision rounds also remain unclear, resulting in discussions upon delivery.
Signals and red flags
Look out for these red flags before you sign or start.
- Vague description: ‘as discussed’ without elaboration or deliverables.
- Fixed price without a list of functionalities/milestones.
- Post-calculation without an hour cap and without a rate per role.
- No arrangement for expenses/travel costs.
- No acceptance criteria or revision rounds.
Provisions to be included or amended
Explicitly define the content and boundaries of the assignment and arrange for additional work in advance.
- Scope matrix: in-scope/out-of-scope and assumptions/dependencies.
- Deliverables + milestones with deadlines and acceptance criteria.
- Additional work procedure: written change request, rates, lead time.
- Hour cap/budget ceiling and escalation in case of exceeding.
- Expense policy: what is included, what is charged at cost price.
Practical tips
Make it concrete and verifiable, even outside the contract.
- Write a concise SoW in plain language for each deliverable.
- Link payment to milestones or partial deliveries.
- Confirm scope changes by e-mail before implementation.
- Request input from the client in good time and note dependencies in the planning.
4. Intellectual property: transfer, licences and portfolio rights
Intellectual property seems like a minor issue until delivery approaches. Then it becomes clear who is allowed to do what with code, content or design. The tempting pitfalls of a freelance contract can be summed up in a few words: transfer, licence, source files and portfolio.
Why this is a pitfall
By law, copyright belongs to the creator. There is often an exception for employees, but not for freelancers. Without explicit transfer, the client usually has no ownership, only limited use.
Signals and red flags
Does nowhere it say ‘transfer of copyright’? Are there no agreements about source files, rights of use for preliminary work or third-party components? Vague language such as ‘work remains property’ without a clear licence scope is a warning sign.
Provisions to include or amend
Put in writing: explicit transfer of copyrights to deliverables, the moment of transfer (upon payment/delivery) and the scope of licences on existing material. Regulate access to source files and third-party/open-source conditions.
Practical tips
Use clear language (what is/is not covered by the transfer) and involve all actual creators in the transfer. Explicitly agree on portfolio rights: showcase or no showcase, with or without name/logo, after going live.
5. Termination and term: early termination, notice periods and exit arrangements
This is where things often go wrong: the tempting pitfalls of a freelance contract lie in an unclear term and the lack of a proper exit. Then you are stuck with work or costs without control over transfer and settlement.
Why this is a pitfall
In the case of a fixed-term contract without an interim termination clause, early termination is usually not possible. If there are no clear notice periods and exit agreements, this will result in stagnation, discussions and loose ends regarding payment and transfer.
Signals and red flags
Be aware of fixed-term contracts without an explicit interim termination option, unilateral termination rights for the client, excessively long terms, and no agreements on settlement, handover or access to source files at the end of the contract.
Provisions to include or amend
Include a clause for ‘interim termination by both parties’ with symmetrical notice periods (e.g. 14–30 days). Specify grounds for termination, an exit arrangement (pro rata settlement, delivery/transfer, IP status) and a handover schedule with milestones.
Practical tips
Make the type of term explicit (fixed or indefinite) and link payments to milestones until the end date. Work with an exit checklist and plan the transfer in advance. Have Law & More review the termination and exit provisions before commencement.
6. Personal labour and replacement: use of third parties and subcontractors
If your contract prohibits replacement or subcontracting, you are drawing the appearance of self-employment towards you. The DBA Act looks closely at the element of ‘personal labour’: the stricter you are in requiring to deliver personally, the greater the risk of qualification as employment and of continuity problems in the event of illness or scarcity.
Why this is a pitfall
The combination of mandatory personal commitment and extensive right to give instructions is exactly what the DBA wants to prevent. Without properly arranged replacement, you lose flexibility, projects come to a standstill, and it remains unclear who is liable for the work of third parties engaged.
Signals and red flags
Pay attention to phrases such as ‘only the contractor performs the work’, a total ban on subcontracting, or ‘replacement only after prior written permission per half-day’. Fixed working hours/attendance and internal leave or sick leave procedures reinforce the image of personal labour.
Provisions to include or amend
Include a genuine substitution clause (freely replaceable, with appropriate qualifications). Specify that the contractor remains responsible for quality, security and compliance, including chain obligations (NDA, IP transfer, GDPR). Specify a reporting obligation when engaging third parties and a workable acceptance test.
Practical tips
Ensure that practice and paperwork are consistent: introduce a replacement pool, document replacements in advance by email, onboard third parties with NDAs and access restrictions, and use a short checklist (competencies, security, IP/GDPR) before anyone joins your project.
7. Liability and indemnities: limitations, caps and excluded damages
Liability often only receives attention after an incident. Many models lack a comprehensive arrangement, which means that a single mistake can result in unlimited claims and messy indemnities towards third parties. This makes discussions expensive and projects uncertain.
Why this is a pitfall
This is one of the tempting pitfalls of a freelance contract: without caps, exclusions and clear indemnities, your risk is practically unlimited, especially in the case of IP or privacy claims involving third-party damage.
Signals and red flags
Watch out for wording that opens the door to unlimited liability.
- “The contractor is fully liable for all damage.”
- No distinction between direct/indirect damage; no cap.
- Broad indemnification “for all third-party claims” without control.
Provisions to be included or amended
Establish a balanced, workable risk arrangement for both parties.
- Liability limit (cap): e.g. up to invoice value/multiple thereof.
- Exclusion of indirect damage: with carve-outs where necessary (intent/gross negligence, IP infringement, data breach).
- Indemnification process: duty to report, cooperation, control of defence and settlement.
- Duty to mitigate & insurance: damage limitation and appropriate policy obligation.
Practical tips
Keep it short, specific and symmetrical; no hidden one-way risks.
- Mirror provisions: caps and exclusions apply to both parties.
- Link exceptions to specific risks (IE/GDPR), not ‘everything’.
- Have Law & More review the clauses for consistency with scope, IP and privacy.
8. Rates and payment: terms, advances, indexation and suspension
Cash flow can make or break your assignment. The tempting pitfalls of a freelance contract often lie in long payment terms, unclear expenses and no right to suspension or interest in the event of late payment.
Why this is a pitfall
Without strict payment agreements, you shift the liquidity risk to yourself. With fixed prices or post-calculation without caps, discussions quickly lead to delayed invoices and cash flow stress.
Signals and red flags
Watch out for 60–90-day payment terms, no advance payments, ‘payment after internal acceptance’ or PO release. Also risky: unilateral rate changes by the client and no arrangements for expenses or indexation.
Provisions to include or change
Establish payment within 14–30 days, with advance or milestone invoices and annual indexation. Include suspension rights, retention until payment, statutory interest and reasonable collection costs; framework for expenses and hour caps.
Practical tips
Invoice immediately per milestone with full PO number and proof of deliverable. Send timely reminders, issue formal notices of default and suspend work in the event of non-payment; have Law & More fine-tune your payment clauses.
9. Confidentiality and restriction of competition: NDA, non-competition and relationship clauses
NDAs and competition clauses are often adopted indiscriminately and are therefore far too broad. This not only increases your claim risk, but can also unnecessarily restrict your freedom of enterprise and even reinforce the image of an employment relationship if the clauses are too ‘restrictive’.
Why this is a pitfall
Overly broad confidentiality hinders your work and the reuse of generic knowledge. A non-competition or relationship clause that goes too far can block your next assignments and is also undesirable in freelance relationships from a DBA perspective.
Signals and red flags
Pay attention to these before you sign.
- Unlimited NDA: no purpose, no duration, even for publicly available information.
- Comprehensive non-compete: ‘no work for competitors’ without sector/area/duration.
- Relationship clause on all contacts (including latent leads) with high, unilateral penalties.
- Unilateralism: confidentiality and penalties apply only to the contractor.
Provisions to include or amend
Set the restriction strictly and workably.
- Purpose-specific NDA with exceptions (public, already known, independently developed) and reasonable duration.
- Targeted non-compete or, preferably, relationship clause: limited to customer list, clear activities, reasonable duration and region.
- Penalty clause reasonable and symmetrical, with right of mitigation and damage ceiling.
- Use & reuse: carve-out for generic knowledge, tools and templates.
Practical tips
Make agreements concrete and verifiable.
- Request a customer or competitor list instead of an industry ban.
- Opt primarily for a relationship clause; non-compete only if strictly necessary.
- Mark confidential information and apply need-to-know access.
- Let Law & More tighten up your NDA/clauses in terms of proportionality and DBA compliance.
10. Privacy and data: processing agreement, security and data breaches
Sharing personal data without clear privacy agreements is asking for trouble. The tempting pitfalls of a freelance contract often lie in vague NDAs that do not regulate roles (GDPR), security and data breaches. This leaves you without direction if things go wrong.
Why this is a pitfall
Without clear role definitions (controller vs. processor) and concrete security and reporting agreements, you run the risk of claims, stalled projects and GDPR problems. The law looks not only at paper, but also at actual implementation.
Signals and red flags
Be aware of these red flags in contracts and practice.
- Only an NDA; no processing agreements.
- Unrestricted data access without need-to-know.
- No agreements on data breaches, logging or deletion.
- Free use of subcontractors without a pass-through obligation (chain clause).
Provisions to include or amend
Establish strict privacy provisions in the contract (separate VWO or integrated).
- Role clarification under the GDPR and purpose limitation of processing.
- Security measures: access matrix, encryption, logging, backups.
- Data breach procedure with strict reporting deadlines and incident response.
- Subprocessor consent and chain obligations (NDA/IE/GDPR).
- Data minimisation, retention periods and data return/deletion at the end of the contract.
Practical tips
Limit what you receive and what you share, and ensure compliance.
- Work with separate environments and least-privilege access.
- Keep a processing register and track data flows.
- Test your incident process (tabletop) and document decisions.
- Have Law & More review your processing agreements and security clauses.
11. Workplace and resources: access, tools, safety and health and safety
Where you work and what resources you use also determine your risk. Excessive integration into the organisation (office obligations, internal schedules, company accounts) increases the risk of DBA, while inadequate onboarding/offboarding and loose BYOD agreements lead to data leaks, licensing problems and discussions about security and damage.
Why this is a pitfall
Workplace and access agreements directly affect authority, safety and security. Mandatory attendance, internal procedures and full employee tooling can evoke the image of employment. At the same time, unclear tooling (who provides what, what rights, what security) increases the risk of incidents, resulting in claims, downtime and loss of data or IP.
Signals and red flags
Look out for signs that DBA and security risks are accumulating before you start or extend. Without clear frameworks, the risk of errors and discussions increases, especially when multiple parties share access.
- Require office/schedule and internal leave procedures as if you were an employee.
- Unlimited system rights without need-to-know or logging; no MFA/VPN requirement.
- BYOD without security requirements (encryption, antivirus) or data minimisation.
- No offboarding process: no deadline for revoking accounts and returning resources.
- Vague safety/health and safety instructions when working on site; unclear who supplies PPE/tools.
- Licence and ownership uncertainty regarding software, hardware and configurations created.
Provisions to be included or amended
Briefly and specifically record what is allowed, what is required and who is responsible. Explicitly mention independence and results-based management, not attendance-based management, and ensure security and exit.
- Access matrix and security: least privilege, MFA/VPN, logging, confidentiality.
- Tooling/BYOD policy: requirements for devices, updates, encryption; who supplies/maintains.
- Safety and health and safety at the location: following instructions, PPE, incident reporting obligation.
- Licences & ownership: who pays for and owns hardware/software and configurations.
- Onboarding/offboarding deadlines: account creation, key cards, data return and deletion.
Practical tips
Keep paperwork and practice strictly in line and work with checklists. This will help you avoid surprises at the start and end and minimise DBA and security risks.
- Start and exit checklist: accounts, rights, resources, data return, IP handover.
- Segregation: separate tenant/project environment; no standard employee profiles.
- Document deviations by email (home/office, extra rights) with end dates.
- Test your offboarding: revoke access and logging within 24 hours; verify data deletion.
12. Choice of law and forum: applicable law, competent court and alternative dispute resolution
Without a clear choice of law and forum, a conflict will result in a costly process to determine where and under which law the dispute should be settled. This is one of the tempting pitfalls of a freelance contract: you lose time, money and negotiating power before the content is even discussed.
Why this is a pitfall
In the absence of or unfavourable choice, complex referral rules apply and the other party can forum shop, resulting in higher thresholds and less leverage for you.
Signals and red flags
Exclusion of Dutch law, exclusive foreign arbitration, mandatory litigation abroad, language requirements that disadvantage you, or a prohibition on summary proceedings/provisional measures.
Provisions to include or amend
Explicitly opt for Dutch law, a competent court in the Netherlands, and establish an escalation ladder: consultation > mediation > (optional) arbitration or court. Determine the language and place of dispute resolution and retain the right to provisional measures.
Practical tips
Check the ‘battle of forms’ (whose terms and conditions apply), tailor your choice of forum to your evidence and witnesses, and ensure that urgent measures can be taken before the Dutch court; have Law & More review this in advance.
13. Delivery and quality: acceptance criteria, testing and guarantees
Completion is the moment when expectations collide with reality. Without clear acceptance criteria, testing agreements and guarantees, a project can get bogged down in endless iterations, withheld payments and discussions about what constitutes “completion” — classically one of the tempting pitfalls of a freelance contract.
Why this is a pitfall
Payment is often linked to acceptance. If acceptance is not strictly regulated, the client can delay, revisions can continue and the risk shifts entirely to the contractor.
Signals and red flags
Vague wording and open ends predict acceptance problems. Watch out for language that does not test anything and leaves everything open, or, conversely, absolute guarantees that are not feasible.
- “Delivery in accordance with the client’s wishes/instructions” without criteria or a deadline.
- “Acceptance after internal approval” without procedure, roles or dates.
- No acceptance deadline or “unlimited revision rounds”.
- Absolute “bug-free” or “fit-for-any-purpose” guarantees without scope.
Provisions to be included or amended
Establish a compact acceptance procedure with criteria, deadlines and recovery. Link partial deliveries to milestones and arrange what happens in the event of rejection.
- Acceptance period (e.g. 5–10 working days) and written rejection or approval.
- Objective criteria and severities; repair and retest deadlines.
- Fictitious acceptance in the absence of a response or commissioning.
- Warranty period (e.g. 30–90 days) for error recovery; maintenance separate.
Practical tips
Demonstrate a working version before formal delivery and record test data, roles and findings. Link invoices to accepted milestones and keep a shared list of defects to avoid discussions.
Conclusion
Small sentences, big consequences: false independence, a scope that spreads out, missed IP transfer, infinite liability, long payment terms, overly broad NDAs, shaky privacy agreements, unclear workplace/access, an unfavourable choice of forum and vague acceptance procedures. Do you recognise any red flags? Stop, renegotiate and ensure that the paperwork and practice are consistent. Document every change and monitor milestones, payments and exit.
Want certainty before you start? Let Law & More preventively review your contract and actual collaboration. Fast, pragmatic and multilingual, with an eye for DBA compliance and commercial balance. Schedule a free introductory meeting and take the first step today towards carefree hiring or being hired through Law & More.