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Doubts about service agreement - would you sign this?
Thread poster: Austra Muizniece

Austra Muizniece  Identity Verified
Latvia
Local time: 14:44
Member (2004)
English to Latvian
+ ...
Nov 25, 2005

I've never signed an agreement that actually sets the contractual penalties, is that normal for European agencies? This agency does not have a BB record, which makes me even more suspicious.Also, how would you interpret the clause about completing the job after the termination of contract? I've provided some articles of the agreement, not the whole thing:

If [Translation agency] or, as the case may be, the End Client incurs damage as a result of the Contractor’s negligent execution of a Job, the Contractor shall be fully liable for such damage and provide full compensation.

The Contractor shall complete a Job even after termination of the contractual relationship.

10.3. If violating the obligations laid down in Art. VII. (7.1.) and/or (7.2.), the contractor shall pay a contractual penalty amounting up to double the price of the confirmed Purchase Order.

[10.3. refers to the following paragraphs:
7.1. The Contractor shall immediately confirm the receipt/acceptance of a Job by e-mail. [Translation agency] shall confirm the receipt/acceptance of a completed Job from the Contractor. If failing to receive such a confirmation within 1 hour after the completion deadline agreed for the Job, the Contractor shall contact [Translation agency] by telephone without undue delay.
7.2 The Contractor shall immediately contact [Translation agency] if there are any circumstances that could
jeopardize the timely completion of a Job.]


10.4. If failing to comply with the obligations specified in Art. VII. (7.4), (7.5.), and/or (7.6.), the Contractor
shall pay a contractual penalty of [amount equal to 1600 EUR] for each individual
breach.

[Art.VII – about not contacting the end client]

10.5. If failing to comply with the obligations contained in Art. VIII. (8.3.), the Contractor has committed a criminal offence and [Translation Agency] shall be entitled to a contractual penalty amounting up to [amount equal to 16 000 EUR]

[Art.VIII refers to ownership rights and prohibits using their TM for other clients.]

10.6. A contractual penalty shall be due and payable within 15 days after the claim to such contractual penalty arose.


[Edited at 2005-11-25 11:06]

[Edited at 2005-11-25 11:08]

[Edited at 2005-11-25 11:14]


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Samuel Murray  Identity Verified
Netherlands
Local time: 13:44
Member (2006)
English to Afrikaans
+ ...
No Nov 25, 2005

austra muizniece wrote:
If [Translation agency] or, as the case may be, the End Client incurs damage as a result of the Contractor’s negligent execution of a Job, the Contractor shall be fully liable for such damage and provide full compensation.


No. Compensation should be limited to refunding any payment received.


The Contractor shall complete a Job even after termination of the contractual relationship.


...say what?


10.3. If violating the obligations laid down in Art. VII. (7.1.) and/or (7.2.), the contractor shall pay a contractual penalty amounting up to double the price of the confirmed Purchase Order.


Stiff, but if the obligations referred to, are reasonable, then you may feel free to sign this. Let's take a look, therefore, at the obligations:


7.1. The Contractor shall immediately confirm the receipt/acceptance of a Job by e-mail.


No... if the job is 100 pages, you can't reasonably be expected to acccept or reject the job "immediately".


If failing to receive such a confirmation within 1 hour after the completion deadline agreed for the Job, the Contractor shall contact [Translation agency] by telephone without undue delay.


Why can't *they* use the telephone? Nonetheless, it's a reasonable stipulation (but it's not fair to penalise you double the entire payment for failing to adhere to it, IMO).


The Contractor shall immediately contact [Translation agency] if there are any circumstances that could jeopardize the timely completion of a Job.


Obviously. Goes without saying.


If failing to comply with the obligations specified in Art. VII. (7.4), (7.5.), and/or (7.6.), the Contractor shall pay a contractual penalty of [amount equal to 1600 EUR] for each individual breach. [Art.VII – about not contacting the end client]


Not contacting the end-client is a fair expectation, but I dislike the penalty clause. Still, how likely are you to accidently breach it?


If failing to comply with the obligations contained in Art. VIII. (8.3.), the Contractor has committed a criminal offence and [Translation Agency] shall be entitled to a contractual penalty amounting up to [amount equal to 16 000 EUR] [Art.VIII refers to ownership rights and prohibits using their TM for other clients.]


I use seperate TMs for each client anyway. Don't you?


A contractual penalty shall be due and payable within 15 days after the claim to such contractual penalty arose.


No... because a breach must be proven to qualify for the penalty, and proving it may take a long time.


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Anjo Sterringa  Identity Verified
Spain
Local time: 13:44
Member (2003)
English to Dutch
+ ...
Certainly not Nov 25, 2005

Because of the ridiculuous penalty clauses, enforceable or not, but also because of the liability clause. I have personally never seen a Translator's Agreement containing such penalty clauses in Europe, but I've only read about 20. My 2 cents.

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Siegfried Armbruster  Identity Verified
Germany
Local time: 13:44
Member (2004)
English to German
+ ...
What is their offer? Nov 25, 2005

Why are you even considering to sign such a document?

What do they offer:

- upfront payments,
- payment within 5 days,
- a penalty payable to you if they deliver less than 50,000 words a month.


Read the complete contract, sign it if you thing it is good, edit it if you think it needs editing (and send your version to them), or just put it in the bin (something I would do).

Kind regards
Siegfried


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Austra Muizniece  Identity Verified
Latvia
Local time: 14:44
Member (2004)
English to Latvian
+ ...
TOPIC STARTER
Thanks, Samuel Nov 25, 2005

My thoughts exactly - how can they set out a penalty out of the blue that is not related to the payment in any way.
I guess I'll contact the agency and discuss the contract, unless they agree to change some stipulations, I won't sign then. The reason why I've been considering this is good rates and, as far as I have seen, interesting projects...


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Burkhard Ziegler  Identity Verified
Germany
Local time: 13:44
Russian to German
+ ...
Contractual penalties - (injustified ?) bypassing of the legal way of civil claims Nov 25, 2005

Sveika, kollegas kundze!

austra muizniece wrote:
I've never signed an agreement that actually sets the contractual penalties, is that normal for European agencies?

Some do, some don't. I wouldn't accept them, because they are bypassing the (mandatory) legal claim via the courts instances.


austra muizniece wrote:
This agency does not have a BB record, which makes me even more suspicious.

If you feel bad with that client don't accept the job/frame contract - I presume that this is a frame contract.

austra muizniece wrote:
If [Translation agency] or, as the case may be, the End Client incurs damage as a result of the Contractor’s negligent execution of a Job, the Contractor shall be fully liable for such damage and provide full compensation.

Of course, under certain conditions you may be held responsible for your work even if the service has been rendered to an agency. But the agency is trying to bypass the juridical instances of a claim and to collect the possible value in dispute as easyly and quickly as possible. I don't know which right has the higher priority in Latvia / EU: the liberty of contracts (bypassing and excluding other laws and rights) or the mandatory claim via civil courts/tribunals.

Excourse: When making contracts with final consumers (physical persons) in Germany/EU excluding certain consumers rights is almost impossible; when making contracts between entrepreneurs there is more possible.

austra muizniece wrote:
The Contractor shall complete a Job even after termination of the contractual relationship.

This may be legal. In a relation to a final consumer and in case of a lack of quality the seller/ service provider must provide improvement(s) and in worst case compensations.

As I understand the agency in your case, they want to throw all work to you, e.g. even if a client's complaint is injustified. Have a nice time with them. I personally hate endless discussions with agencies about alleged lacks of quality for translations done at already minimum rates.
austra muizniece wrote:
10.3. If violating the obligations laid down in Art. VII. (7.1.) and/or (7.2.), the contractor shall pay a contractual penalty amounting up to double the price of the confirmed Purchase Order.

[10.3. refers to the following paragraphs:
7.1. The Contractor shall immediately confirm the receipt/acceptance of a Job by e-mail. [Translation agency] shall confirm the receipt/acceptance of a completed Job from the Contractor. If failing to receive such a confirmation within 1 hour after the completion deadline agreed for the Job, the Contractor shall contact [Translation agency] by telephone without undue delay.

This is simply mad!

On the other hand, in Germany we have a word called "Scheinselbstständigkeit" - Working under freelancer's conditions for only one employer (bypassing social and fiscal obligations). This kind of fixing your person to the agency might be considered as this one. Normally, the agency contacts you, offers you a job and you decide. But they cannot fix times to do so.
(Favourable marketing behaviour and service orientation to your clients is the other side of the medal.)


austra muizniece wrote:
7.2 The Contractor shall immediately contact [Translation agency] if there are any circumstances that could
jeopardize the timely completion of a Job.]

This is justified, but without high penalties.

austra muizniece wrote:
10.4. If failing to comply with the obligations specified in Art. VII. (7.4), (7.5.), and/or (7.6.), the Contractor
shall pay a contractual penalty of [amount equal to 1600 EUR] for each individual
breach.
[Art.VII – about not contacting the end client]

Of course, you shall not contact the final client. But it should be discussed with a lawyer if these fixed penaties are justified. Of course, if you violate your contractual obligations, you must compensate the real (but not a fictive!) damage. So must the agency.

austra muizniece wrote:
10.5. If failing to comply with the obligations contained in Art. VIII. (8.3.), the Contractor has committed a criminal offence and [Translation Agency] shall be entitled to a contractual penalty amounting up to [amount equal to 16 000 EUR]


[Art.VIII refers to ownership rights and prohibits using their TM for other clients.]

see above.

austra muizniece wrote:10.6. A contractual penalty shall be due and payable within 15 days after the claim to such contractual penalty arose.

They try to bypass the legal way once again.

So,you have 15 days to close your IU or SIA and to open another one under another registered address or to escape to your big brother's neighbour country. Visu labu.

Please, understand that this is no proper legal advice. Please, contact a confiable lawyer.

Regards,
Burkhard Ziegler
http://www.tilts.de


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Cristóbal del Río Faura  Identity Verified
Spain
Local time: 13:44
English to Spanish
+ ...
No Nov 25, 2005

There are many arguable details as pointed out by Samuel and Burkhard. Another example:



10.5. If failing to comply with the obligations contained in Art. VIII. (8.3.), the Contractor has committed a criminal offence and [Translation Agency] shall be entitled to a contractual penalty amounting up to [amount equal to 16 000 EUR]



If the contractor has allegedly committed a criminal offence, he should be sued and then the court will decide whether this is so or not and whether the translation agency is "entitled" to a penalty, and the amount of it.

But in general, for me such kind of pretended agreements create a bad atmosphere from the very beginning and I could never work for such a company.



[Edited at 2005-11-25 11:56]


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John Walsh  Identity Verified
Italy
Local time: 13:44
Member (2004)
Italian to English
No way Nov 25, 2005

I'd never sign a document like that for all the reasons above.

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Fred Neild  Identity Verified
English to Spanish
+ ...
Run! Nov 25, 2005

If I were you I would say no, no need to repeat all the reasons already stated by our colleagues.

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Wouter van Kampen
Thailand
Local time: 18:44
Danish to Dutch
+ ...
Simply do not sign such contracts Nov 25, 2005

austra muizniece wrote:

--snip--

The Contractor shall complete a Job even after termination of the contractual relationship.

--snip--


This is completely outrageous. You would waive your right to suspend or stop working on an assignment at the very moment they announce dropping your rate for that assignment.


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Benno Groeneveld  Identity Verified
United States
Local time: 07:44
English to Dutch
+ ...
They are setting you up Nov 25, 2005

for a payment to THEM. Why else would they have all those outrageous charges payable by you on the flimsiest of grounds?

[Edited at 2005-11-25 13:34]


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Harry Bornemann  Identity Verified
Mexico
English to German
+ ...
I would edit and discuss the contract - if I had the time... Nov 25, 2005

I would edit the unacceptable paragraphs and double or
triple my rate for the exacting ones.

In case the client has good reasons to make these demands,
he will also have good reasons to accept a corresponding rate.

In case he has no good reasons, he won't be able to discuss them.


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Balaban Cerit  Identity Verified
Turkey
Local time: 14:44
English to Turkish
+ ...
What about their obligations and related penalties? Nov 25, 2005

Hi Austra,

I personally wouldn't sign such a contract. I agree with Samuel and the others. Still, since their rates and interesting projects make you think, I would like to add:

Just like sarmb asks, what do they offer? I'm not only asking about the rate and payment terms, I am asking about the contract.

In other words, which clauses in this contract protect you against very possible situations that can (and do) occur in the translation industry, intentionally or unintentionally? What about their obligations and related penalties if they do not meet these obligations?

As Burkhard says, "of course under certain conditions you may be held responsible for your work", but has this agency put on paper the same stringent conditions for themselves? What about their responsibilities?

After inspecting the offered contract in this light, don't accept it if you feel that there is an unfair approach and please consult a lawyer before signing anything, even if they change it according to your requests. When presented with something like this, I seek professional legal advice even if I think that I understand everything.


[Edited at 2005-11-25 14:36]


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John Walsh  Identity Verified
Italy
Local time: 13:44
Member (2004)
Italian to English
. Nov 25, 2005

Totally agree with Harry.

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Abdellatif Bouhid  Identity Verified
Local time: 07:44
English to French
+ ...
NO WAY! Nov 25, 2005

Even the Ten Commandments aren't that long or that enslaving.

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