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American Translators Association (ATA): Business Smarts-Rejecting Contract Clauses

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American Translators Association (ATA): Business Smarts-Rejecting Contract Clauses

Rejecting Contract Clauses


Keeping track of contracts is an important part of managing a small business. Freelance contractors should always read the fine print of cooperation agreements sent by agencies and other organizations, and never accept them without a thorough review.

Dear Business Smarts:

A translation agency that sends me large quantities of regular work recently asked me to sign a new independent contractor agreement. In addition to the customary clauses concerning confidentiality, not contacting the agency’s clients directly, and the ownership of materials to be translated, the agreement contained the following rather confusing clause toward the end:

"The Company reserves the right, in its sole discretion, to conduct audits of Contractor’s facilities, business practices, and any other matters reasonably relating to the performance of Contractor’s services hereunder. Contractor acknowledges that the Company’s right to conduct such audits is a condition of Contractor’s engagement hereunder, and Contractor agrees to cooperate fully in such audits. Although the Company, where practicable, will endeavor to provide advance notice to Contractor of its intent to conduct an audit, the parties agree that the Company may conduct an unannounced audit."

Does that mean I may have a group of auditors invade the privacy of my cramped home office, without prior notice if I am unlucky? How would I protect the confidentiality of other client documents in such a case? Which of my “business practices” would the auditors look at? Although I like working for this company, I am so upset about this requirement to accommodate potential audits that I am contemplating not signing this agreement. Will I be denied further work assignments if I do not sign the agreement?
— No Audits, from Texas

Dear No Audits:

You are very wise to read the content of any such agreement carefully before signing. The clause in question most likely refers to dealings with much larger business entities than yours, for example, other agencies specializing in certain language groups or fields. Audits have become much more common in the corporate world, and are used to document compliance with the requirements of a variety of quality and accounting standards. Nevertheless, the agreement was sent to you as the sole proprietor of a small business, and your signature would indicate that you agree, at least in theory, to have such investigations performed at your business premises. While it seems highly unlikely that any company would spend resources on auditing a freelance translator, your approval of the clause leaves the door open for a possible invasion of your privacy and the possible breach of confidentiality agreements you have with other clients.

Given the fact that you do not want to sign the agreement in its current form, but are interested in continuing your working relationship with the company, you have several choices. One course of action would be to communicate with the project manager who sent you the agreement, with a copy to his or her supervisor. Explain politely that you cannot accept this specific clause and ask what the company policy will be with regard to future assignments if you do not sign the agreement. Be sure to print and save any responses you receive. As an alternative, you can also clearly delete any clauses you find unacceptable, and mark the deleted sections with your initials. Write a brief and courteous explanation on a separate sheet, including your signature and the date, and ask that a counter-signed copy of the agreement be returned to you for your records. It would certainly not be inappropriate to follow up on this request if no response is forthcoming. A third alternative may be simply to ignore the agreement and continue to accept assignments from the company, although this would provide the least amount of contractual protection.


Reprinted from The ATA Chronicle: June 2008, p 34