A consultant is essentially a freelancer that is not employed by the company but rather serves as an independent expert who provides a service to the client on a self-employed basis. Consultants are not protected by employment rights like company employees. The entire basis of the relationship between a client and a consultant is simply contractual and subject to less statutory regulation.
A Consultancy Agreement is a contract by which a company engages a consultant to provide services as an independent contractor. A person engaged under a Consultancy Agreement is not an employee and does not enjoy statutory rights as an employee.
Under a Consultancy Agreement, a consultant is bound to provide their expertise or knowledge by understanding the client’s requirements and finishing the project by the deadline.
Why do I need a consultancy agreement?
Whenever you enter into any business arrangement, a certain amount of formalization is always necessary. This is to protect all parties and also to ensure everyone is on the same page. The same principle applies when you hire a self-employed consultant. The Consultancy Agreement ensures you have formalized the agreement and everyone is clear about what is expected of them. A Consultancy Agreement is also vital to protect your business when it comes to things such as ownership of intellectual property and data protection.
What is the difference between a consultant and a contractor?
A consultant is a person who is hired to evaluate a client’s needs and provide expert solutions on the basis of their requirements whereas a contractor is hired to work according to the needs and guidelines of the clients.
Why should I appoint a consultant for my business?
Appointing a Consultant gives more freedom to the business instead of hiring a full-time employee because of the less legal formalities and financial burden associated with it. A consultant also helps in increasing productivity because they have specialized knowledge in their respective fields.