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General Services Agreement
A service agreement refers to a contract in which one party agrees to provide a particular service or services to the other party in return for payment as specified in the contract. The term “general services agreement” is used to signify that the contract is somewhat generic and can be used in multiple circumstances.
General service agreements are common in the construction industry, where businesses or property owners enter into agreements with general contractors. Similarly, general contractors enter into numerous general service contracts with subcontractors. For example, a general contractor might enter into separate agreements with a grading contractor, framing contractor, electrical contractor, and a painting contractor, just to name a few. An effective general service agreement typically addresses at least the following basic terms:
- Careful identification of the parties to the contract and who will be providing the services.
- A description of the exact services to be provided and a schedule of when they will be performed.
- The price that will be paid and when it will be paid.
These terms represent a bare minimum. Careful contract drafters would likely address many other issues, such as warranties; remedies/damages for breach (including untimely performance); alternative dispute resolution; specifications on the level of quality for materials and services; insurance; limitations of liability; and so forth.
Frequently Asked Questions
What’s the difference between a general services agreement and an SOW?
The general services agreement sets the standing legal terms, things like payment mechanics, insurance, warranties, liability limits, and dispute resolution. The statement of work sits underneath it and describes one specific engagement: the deliverables, schedule, and price. That split lets you negotiate the heavy legal terms once and then add new projects with a short document each time.
What should a services agreement include beyond price and scope?
Beyond the parties, the services, the schedule, and the payment terms, cover insurance requirements, warranties on workmanship and materials, indemnification, limits on liability, intellectual property ownership, confidentiality, subcontracting rules, termination rights, and how disputes get resolved. Construction agreements often add lien waivers, change order procedures, and safety obligations. The bare minimum terms won’t protect you when something actually goes wrong.
Can one services agreement cover multiple projects?
Yes, and that’s usually the point of a general form. Structure it as a master agreement with the standing terms, then attach a separate work order or statement of work for each project. Each new engagement references the master rather than restarting negotiation. Just make sure the master says which document controls if a work order conflicts with it.
