Service Level Agreement (Standard)

This Service Level Agreement template is designed for longer-term B2B service arrangements where a client needs more than a basic services contract. It combines the core terms for the provision of services with agreed service levels, performance monitoring, and remedies if the required standards are not met.

It is suitable where consistency, accountability, and ongoing review are central to the relationship between the service provider and the client.

The data protection provisions in this document have been reviewed and updated for Brexit. References to data protection legislation have been updated with reference to the UK GDPR.

What this Service Level Agreement template covers

This SLA template covers both the services being provided and the standards to which they must be delivered. It creates a practical framework for measuring service performance, reporting on delivery, and managing service failures in a structured way.

It also includes provisions for reviewing the wider contractual relationship, making it well suited to ongoing outsourced or managed service arrangements between businesses.

When to use an SLA instead of a basic services agreement

A simple services agreement may be enough for short-term or straightforward work. This Service Level Agreement is more appropriate where the client needs the service provider’s work to meet defined and measurable standards over a longer period.

It is particularly useful where the parties need clear rules on:

• service performance standards;
• service level monitoring and reporting;
• review meetings and contract management; and
• penalties or termination rights if agreed service levels are not achieved.

Service levels, performance monitoring, and penalty provisions

The agreement includes two levels of meetings to monitor both service delivery and the wider contract.

• Operational meetings are intended for employees with detailed knowledge of the services and performance reports.
• Management meetings are intended for representatives with authority to make decisions on behalf of the parties.

This structure can be adjusted to suit the organisations involved.

The template also deals with the consequences of failing to meet agreed service levels. The default drafting assumes two levels of penalty:

• an initial penalty fee; and
• a further penalty fee together with the client’s right to terminate the agreement.

These provisions can be adapted, and additional levels of penalty may be inserted if required. The penalty fees themselves should be set out in Schedule 2.

Key drafting options on third-party services and intellectual property

Clauses 6.8 and 6.9 are optional and address the parties’ freedom to deal with third parties. One or both may be included depending on the commercial balance required.

Clause 6.9 allows the client to obtain similar services from a third party without affecting the service provider’s rights under this agreement, but it may also restrict the service provider’s freedom to deal with the client’s competitors.

That clause should be used with care, particularly because restrictions of this kind may be challenged as a restraint of trade if consent is withheld unreasonably.

The intellectual property clause also contains alternative drafting options, so internal cross-references should be checked carefully when choosing between them.

Schedules covering services, fees, service levels, and data processing

The schedules are central to how this Service Level Agreement works and should be completed in as much detail as possible. Once completed, they should operate as a practical reference point for both parties.

The schedules cover:

• the services;
• fees, payment, and penalty fees;
• service levels, performance monitoring, and performance reports; and
• data processing.

Main legal provisions included in this UK Service Level Agreement

This template includes clauses covering definitions and interpretation, term, the parties’ respective obligations, fees and payment, provision of the services, service and agreement monitoring, performance management, confidentiality, intellectual property, termination, post-termination matters, liability and indemnity, force majeure, data protection, data processing, assignment and sub-contracting, non-solicitation, dispute resolution, and law and jurisdiction.

Service Level Agreement (Standard) is part of Business . Just £38.50 + VAT provides unlimited downloads from Business for 1 year.