Part 3: Top 10 ‘Must Haves’ in Every Digital MSA

Today, we’ll share the last three ‘Must Haves’.

We’re covering Poaching, Promotion and Credit, and Payment Schedule. If you missed part 1 or part 2, I suggest you go back and read them.

8. Poaching: I Love Your Employees.  Are They for Sale (or Maybe Lease)?

Key Discussion Points: In most good relationships both parties are extremely vested. You work closely with one another towards a common goal. Hopefully you like one another.  Sometimes you like each other a lot. What happens when your client wants to hire the intelligent, enthusiastic and experienced point contact from your team? How about when you want to hire your perfect client? It’s a sticky issue and one that’s sure to put a kink in any relationship.

Suggested Language:

We spend a great deal of time and money training our employees and ensuring they stay at the top of their game.  We have no doubt you’ll love them—but they are not for sale—so don’t even think about it.  (If we gave away our employees, where would that leave us?)

During the term of this Agreement and for a period of one (1) year following the last date on which AgencyNet provides you with any deliverable or Project, you and we both agree that neither of us will (i) solicit or hire any of the other party’s employees, directly or indirectly, or assist or encourage any third party from doing so, or (ii) directly or indirectly request, induce or advise any of the other party’s employees to withdraw, curtail or terminate their relationship with the other party.

9. Promotion and Credit: We’re proud of the work we do—and we want to show it off.

Key Discussion Points: Will you be able to showcase the work? How about the ability to submit it to award sites? Are you working as an outsource partner to another agency(s) – if so, how will the credit be dispersed?

Suggested Language:

We’re proud of the work we do—and we want to show it off.  You agree that we are allowed, in perpetuity and without any restrictions other than those described below, to display the project in the “Portfolio” (or similar) section of our company’s website and on promotional materials, sufficient to demonstrate our talents and the type of work that we did for you.  It is agreed that our use will be limited to no more than three (3) screenshots or a video recap of the project, and (where possible) will have links to the project.

Additionally, we agree that we may submit the work under this MSA and/or applicable SOW for various awards in the digital category or its equivalents and will inform you of such submissions where applicable. All submissions of the work under this MSA, whether initiated by you or us, will bear joint credit.

NOTE: Thanks to our good friend Jason Prohaska at Big Spaceship for some of the language on this clause.

10. Payment Schedule.

Key Discussion Points: How much will it cost you in overhead to begin developing the project? Can you afford to cover that until you receive your first payment? Will you be billing in advance? Providing 7-day payment terms? 21 days? 30? What are the opportunity costs associated with taking on this project? Are you walking away from another project to take this one on? Would you suffer financially if the project were terminated mid-development?

Suggested Language:

Obviously we’re a Digital agency and not a bank. That wouldn’t be so hot nowadays, would it? As such, we will bill you as follows:

  • First Payment, 30% of total project invoiced upon execution of the SOW.
  • Second Payment, 30% of total project, invoiced after completing the first phase of the SOW.
  • Third Payment, 30% of total project, invoiced after completing the third phase of the SOW.
  • Final payment, 10% of total project, invoiced upon execution of the project release form.

We’ll ask that you pay all invoices within 7 (ok, 21) days of receipt. That’ll keep our employees well-fed and focused on your work .

If at any time you terminate a Scope of Work without cause or we terminate a Scope of Work for cause, you understand and agree to pay us a cancellation fee equal to twenty percent (20%) of the total cost of the project. You also agree that the cancellation fee is in addition to any other amounts previously paid or payable to us. We further agree that the cancellation fee is not a penalty; instead, it is an amount that the parties believe to be reasonably sufficient to cover AgencyNet’s lost opportunity costs and other intangible costs involved in the shutdown of the project.

About this series:

A number of people have asked me why I decided to share the information contained in this post.

Well, my answer is threefold:

  1. This part of the business is a drag.  We love creative, strategy, innovation, and technology – not law. If we did, we’d all be lawyers (and the world certainly doesn’t need any more of those.)
  2. If I was an ActionScript developer, I’d develop some slick programmatic motion experiment and open-source it to the community.  If I was a designer, I’d develop a killer desktop wallpaper, some cool typography or a Photoshop brush and share it. This is my open-source – hope it’s helpful.
  3. AgencyNet is a member of The Society of Digital Agencies and I promised the rest of the Board of Directors that I’d take a first pass at creating a starting point on this for the membership to weigh in.  Be sure to check SoDA’s Blog in a month or so to see the consensus of the group.

Well, if you’ve made it this far… thanks for reading – I thoroughly enjoyed writing this piece.

DISCLAIMER: While I strongly recommend that these topics be included in your MSA, it’s important to note that I am not an attorney by trade.  As such, I would suggest that your contractual language is created or reviewed by an attorney licensed to practice in the state where the contract is governed.  If you have additional questions, feel free to reach out.