6 Legal Things To Consider In Your Terms Of Service
First things, first. Do you even need a terms of service agreement? Absolutely. Whenever there is an exchange of money there are some legal touch points which need to be addressed. Otherwise you run the risk of getting into some murky waters. Now, as much as I like to believe that were are all one with love, there are some people out there who, unfortunately, will be a pain.
As such, there’s nothing wrong with legally protecting yourself should anything occur. That’s the role of the terms of service agreement. Additionally, by setting clear legal boundaries you essentially lay everything out on the table. That means your clients and customers have been made aware of everything and are consenting to abide by your particular terms of service.
Things to be mentioned in the terms of service document
In this article we’re going to discuss some of the things that need to be mentioned in the terms of service document on your website. While this list is by no means exhaustive, and while every business is slightly different, this is a good place to start.
1. Refund Policy
Most people don’t think about a refund policy until they have someone asking them for a refund. This is a major problem that can lead to some headaches down the road. As such, before engaging in a transaction with anyone, your terms of service agreement must be clear on what your refund policy is. There is no right or wrong here as it entirely depends on your business. For example,
- Some businesses only offer refunds for the first 30 days after a product has been purchased.
- Service-based providers, like coaches or consultants, may not offer refunds at all due to the fact that when clients agree to come aboard it limits these business owners from seeking new clients due to lack of time.
At the end of the day it’s your business, therefore it’s your terms of service policy. If someone ends up having a problem with it then they aren’t your ideal client anyway.
Disclaimers are crucial in a “terms of service” document—especially in the world of online business. For example, many blogs offer advice and strategies for different issues. For the sake of simplicity we’re going to stick to health and entrepreneurship. In recent years you may have noticed there’s been a surge in people wanting information on how to run business and live healthier lives.
Those who’ve noticed this surge have responded to the market by creating businesses to fit those needs. Now, here is where disclaimers come in. If you’re a business coach, you’re often times dealing with money. The issue becomes when one of your clients isn’t seeing the results they want. You know as a coach that this could be happening for a multitude of reasons that may have nothing to do with the actual coaching.
As such, it would be in your best interest to have a disclaimer in your terms of service that states results are contingent upon the client and there are no guarantees. If you’re a health coach disclaimers are extra important in your terms of service because you may be dealing with medical conditions.
Let’s face it, you’re not a doctor. Let’s also face the fact that everyone’s body is different and there is no one-size-fits-all formula for weight loss, skin conditions or anything else people may be seeking in the health industry. In this case you would need a terms of service disclaimer that states you will not be legally held responsible if anything goes wrong and that clients are advised to consult their doctors before undergoing anything.
3. Cancellation Policy
One of the biggest complaints I hear among clients and colleagues is when their clients are no-shows to meetings. The best way to avoid this is to have a clear and specific cancellation policy laid out in your terms of service. Again, it’s your business so you can do this any way you please. Can clients cancel the same day? How much advanced notice do you need for a cancellation? What’s your policy for missed appointments? This is one of the areas where it’s very easy to lose money if you don’t set a boundary. Additionally, you will be teaching clients how to treat you and holding them accountable.
4. Affiliate Relationships
By law, you must disclose whether or not you have affiliate or ad relationships in which you receive a commission in exchange for recommended products. As a business coach clients are constantly asking me about which tools I use to run my online business. This could be anywhere from web hosting to accounting software. I am legally bound to disclosing whether or not I recommend any products in which I will receive a commission. The place to do that can be in your terms of service, though it doesn’t have to be.
5. Termination Policy
You know what’s more annoying than clients who don’t show up to meetings? Clients who disappear into thin air. Again, it’s imperative that your terms of service agreement is crystal clear on what your termination policy is, otherwise you could lose money. Does termination need to be in writing? What is appropriate notice?
For instance, perhaps you decide that in order to terminate a contract it must be written with at least 30-days notice. This helps you protect your money, protect your time and give you time to plan for what will happen when this client is no longer around.
I saved the best for last. What’s the point of running a business if you’re not getting paid? In your terms of service you must provide payment terms for the client. How much are they paying you? How often? Do you require a deposit? What’s the late-payment policy? Do you allow payment plans? Are there any fees associated with the payment plan? These are all important questions you must lay out clearly in your terms of service agreement before beginning to work with anyone.
If you’re running a business you will inevitably have to lay out some legal ground rules if you expect to keep working. These legal ground rules are meant to protect you and your client as you engage in work together. They also set out clear boundaries and expectations so there aren’t any surprises down the road. The terms of service does that, and so much more. Use it; protect yourself; succeed.