Most contracts include a clause that allows them to be terminated early. So, even though your contract may be written to end on a certain date, every contract I’ve ever seen gives the client the ability to end it early. Typically, there’s a paragraph that states something to the effect that the client can end the contract early by providing XX number of days’ notice.

1. Should Your Contract
Cancellation Clause
Be Based On Hours?
David Kushan
Managing Partner
Healthcare IS

2. Unfortunately, some of the lessons
you learn in the contracting business
are learned the hard way.

3. The hard way generally means that you were dealing
with someone who took advantage of a situation that
caused you some major inconvenience. Once these
situations occur, of course, you do what you can to
prevent them from happening again.

4. Most
contracts include a clause that allows them
to be terminated early.
So, even though your contract may be written to
end on a certain date, every contract I’ve ever
seen gives the client the ability to end it early.
Typically, there’s a paragraph that states
something to the effect that the client can end the
contract early by providing XX number of days’
notice.

5. On one occasion with a contractor whom we had
working primarily from home, the client notified
us that they were going to be ending the contract
early and that they were giving us the required
notice.
Since this contract was not very long to begin
with, they were required to give us only two
weeks’ notice.

6. So, if we were given notice on Monday, February
10, the contractor’s last day would be Friday,
February 21.
The client gave the notice because they had just
hired someone and decided to pass off the
future work to this person. But although they
gave a two-week notice, they were no longer
sending the contractor work to perform.

7. However, the contractor understood a two-week
notice to mean two more weeks of paid hours, so
the following week he submitted a timesheet for
40 hours.
Unfortunately, the client said they would not
approve the timesheet because the contractor did
not actually do any work.

8. I hope you see the technicality here.

9. I believe you will not run into this type of client
very often.
But the point is that if you change the
cancellation clause from providing two weeks’
notice to providing-80-hours-of-billable-work
notice, you have a much lower likelihood of this
ever happening to you.

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