Most contractor disputes were predictable. The contract had a problem, both sides chose to ignore it, and months later someone paid the price.
None of the clauses below are rare. You'll see versions of them in contracts from well-meaning clients who copied a template from Google. Knowing what to look for — and what to ask for instead — is how you avoid becoming a cautionary tale.
This isn't legal advice. If significant money is involved, pay an attorney to review the contract.
1. A Non-Compete That's Too Broad
Non-competes in contractor agreements are common and often unenforceable, but they can still create friction and expense to fight.
Red flag: "Contractor agrees not to work for any competitor of Company in the [industry] space for 12 months following the end of this engagement."
If you're a frontend developer, this language could prevent you from taking any tech client for a year. If you're a marketing consultant, it could bar you from the entire industry you specialize in.
Ask for instead: A narrowly scoped restriction — no direct solicitation of the client's specific customers you worked with, for a defined short period (3–6 months). Competing as a category should not be restricted.
2. IP Assignment That Captures Personal Projects
Standard IP assignment clauses say the client owns work you create for them. That's fine. Some go further.
Red flag: "Contractor assigns to Company all intellectual property created during the term of this agreement, including work created outside Company's scope."
This language attempts to claim ownership of anything you build while under contract — including your side projects, personal tools, and late-night experiments.
Ask for instead: IP assignment limited explicitly to work created within the scope of this engagement and using Company's resources. Add a carve-out for prior work and personal projects clearly unrelated to the engagement.
3. Net-90 Payment Terms (or No Terms at All)
"Net 30" means payment is due 30 days after the invoice. "Net 90" means 90 days. Some contracts don't specify terms at all.
Red flag: Any payment term longer than Net 30, or a contract that doesn't specify payment terms.
Net-90 is standard in some enterprise industries. As an independent contractor, it means you're extending a 90-day interest-free loan to your client. If they pay late on top of that, you could be waiting four months to get paid for work you already delivered.
Ask for instead: Net 15 or Net 30. For larger projects, 50% upfront is reasonable to propose. If a client insists on Net-60 or longer, price in the carrying cost.
4. Unlimited Revisions Language
This one hides in scope-of-work sections and often sounds friendly.
Red flag: "Revisions included until client is satisfied" or "Contractor will provide revisions as needed."
Without a defined revision limit, a client can request changes indefinitely. Weeks of back-and-forth aren't covered by your original fee, but you have no contractual basis to charge more because you agreed to unlimited revisions.
Ask for instead: A defined number of revision rounds — "Client receives two rounds of revisions; additional rounds billed at $X/hour." This protects both of you and forces scope clarity early.
5. Unilateral Termination With No Kill Fee
Clients should be able to terminate a contract. The question is whether you get paid for work already done.
Red flag: "Company may terminate this agreement at any time for any reason with [3/7/14] days' notice. Upon termination, Contractor will receive payment for work accepted by Company."
"Work accepted" is the landmine. If the client terminates after you've spent two weeks on a project and they haven't formally accepted any deliverables, you may be owed nothing.
Ask for instead: A kill fee clause — typically 25–50% of the remaining contract value — triggered if the client terminates without cause before completion. Plus payment for all hours worked to date, regardless of acceptance.
6. No Change Order Process
Scope creep is how fixed-price contracts become unprofitable.
Red flag: A contract that has a detailed scope section but no mechanism for handling changes to that scope.
Without a change order process, the client can claim that the new thing they're asking for was always implied by the original scope. You have no agreed-upon way to get paid for expanded work.
Ask for instead: A simple change order clause: any modification to the defined scope must be agreed upon in writing (email is fine), including the additional fee and timeline. Make it easy to execute so neither party avoids it.
7. Personal Liability / No Liability Cap
This one can be genuinely dangerous.
Red flag: "Contractor shall be personally liable for any damages arising from Contractor's work, including but not limited to direct, indirect, incidental, and consequential damages."
Without a liability cap, a mistake on a $5,000 project could theoretically expose you to a six-figure lawsuit if the client can argue consequential damages. This is especially true in tech, legal, financial, and healthcare-adjacent work.
Ask for instead: A mutual liability cap, typically limited to the total fees paid under the contract. "Neither party shall be liable for damages exceeding the total fees paid under this agreement." If you have professional liability (E&O) insurance, you can negotiate from a stronger position.
These clauses don't mean the client is dishonest. They mean the contract was copied from a template, and nobody thought through the failure cases. When you ask for changes, frame it as cleaning up the contract rather than challenging their intentions — most clients will agree.
Ready to price projects so these risks don't sink you? ProJobCalc handles contractor proposal pricing, rate calculations, and project estimates.