Services Retainer Agreement (Payment For Set Number Of Hours)
This Services Retainer Agreement (Payment For Set Number Of Hours) is one of several Agreements in this subfolder catering for a supplier of services wishing to provide services to its client under a retainer arrangement. For an explanation and discussion of retainer arrangements generally, please see our Guidance Note: Retainer Arrangements in this subfolder.
This template establishes a retainer arrangement under which the client must pay an agreed retainer fee in advance at stated intervals, e.g. every three months. This gives it the right to order up to a set maximum number of hours of work to be carried out during the relevant period (e.g. three months). In this particular form of agreement, the retainer fee is not only the consideration payable for that right but it is also full payment for all those hours of work however few or many that the client orders up to the maximum. The client is not bound to order any minimum number of hours, but if it orders less than the maximum in any period, or indeed if it orders no work at all, it receives no rebate of any of the retainer fee.
There is no provision either for the client to order or pay for any hours above the set agreed maximum or for the supplier to provide any hours above that set maximum. However, since the Client is paying a retainer fee which is in effect the fee for services up to the set maximum hours, the Provider must provide the quantity of services (up to the set maximum) that the client orders in each period. Contrast this with “call off” arrangements under which the supplier is not bound to accept any order at all that the client places in any period.
If this template does not meet your needs, you might consider whether one of our other templates will better suit your needs.
The retainer fee can be any sum that the supplier considers appropriate, but it will need to be at a level which takes into account the supplier’s commercial, financial and practical needs and circumstances. These may include the fact that the supplier is assured of a guaranteed amount for the set maximum hours whether or not the client requires it to provide all of the set maximum. However, the supplier will need to have the capacity to provide up to the set maximum. It might set the hourly rate to match, or to be less or more than, its standard non-retainer rate, depending on these factors. The client may be content to agree to this retainer arrangement if it is confident that it will need the set maximum (or at least a substantial number) of hours in each period and that it will not need more than the set maximum. If the amount of the retainer fee represents an attractive hourly rate from the client’s point of view, i.e. one as good as or better than the supplier’s usual rate or better than the market rate but in any event one fixed in advance for a certain period, the client may be willing to agree to this type of retainer arrangement even if it considers that it is unlikely to order as many as the set maximum number of hours.
This agreement states that the retainer arrangement will continue indefinitely until either party gives notice to terminate after a stated minimum period. It may be adapted so that it instead continues only for an agreed fixed period subject to notice terminating it sooner.
Optional phrases / clauses are enclosed in square brackets. These should be read carefully and selected so as to be compatible with one another. Unused options should be removed from the document.
This Services Retainer Agreement (Payment For Set Number Of Hours) contains the following clauses:
1. Definitions and Interpretation
2. Provision of the Services
3. Ordering Procedure and Other Order Details
4. Client’s Obligations
5. Fees, Payment and Records
6. Liability, Indemnity and Insurance
8. Intellectual Property Rights
10. Force Majeure
11. Term and Termination
12. Effects of Termination
13. Data Protection
14. Data Processing
15. No Waiver
16. Further Assurance
19. Assignment and Sub-Contracting
21. Relationship of the Parties
23. Third Party Rights
25. Entire Agreement
28. Dispute Resolution
29. Law and Jurisdiction
and the following schedules:
SCHEDULE 1: Specification of Services
SCHEDULE 2: Fees and Payment
SCHEDULE 3: Order Form [pro forma]
SCHEDULE 4: Data Processing
This Services Retainer Agreement (Payment For Set Number Of Hours) is in open format. Either enter the requisite details in the highlighted fields or adjust the wording to suit your purposes.
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