Those who become life coaches usually have a deep-rooted drive to help people. They are most fulfilled when able to take somebody’s hand and join them for a while on their journey, helping them choose directions and plot out their path. Being a life coach presents a unique opportunity to have a real impact on another person’s life, whether you’re helping them through a transition, such as a divorce, guiding them as they build businesses or teaching them to manage or overcome real or perceived barriers. You are somewhere between a best friend and a therapist and you probably love what you do. So much so in fact that you may not even feel as if you’re running a business. Yet, the innate need to help others can make life coaches vulnerable, especially because coaches sometimes neglect to legally protect themselves. At least, until they have their first negative experience.
Why Do Life Coaches Need Business Terms?
Every self-employed person or business owner, no matter how large or small, should have a professionally-drafted legal contract. Business terms for life coaches should be signed by any clients you work with (even those you are offering free or discounted services to).
Although it is not a legal obligation to have terms and conditions, most clients will expect you to and it is considered professional to have legal contracts in place. Business terms can even help you establish how you work and improve your processes. Primarily, business terms and conditions should do the following:
Well-written contracts should clarify the points of your client’s journey with you from start to finish. First and foremost, they should set expectations. Your contract is an opportunity for you to formally explain what life coaching is, what clients might expect and what the objectives are. Terms and conditions can work to educate signees on how coaching works and what the outcomes may be.
Define A Process Of Delivery
Drafting business terms can force you to define how your service is delivered. It can help you to assess risk and tighten your processes. Laying out how you intend to deliver your services provides clarity for both yourself and the client.
Ultimately, terms and conditions, if properly drafted, will protect you and your business. It is an agreement between you and the client as to how you will deliver your service and what the client is committing to. If either of you breaks these terms then the agreement may be used as a key document in any legal proceedings.
5 Legal Essentials In Business Terms For Life Coaches
Delivery Of Service
Your terms and conditions should define how your service is delivered. In business terms for life coaches, you’ll probably begin by establishing whether sessions are in person or online. Delivery of service should also clarify how many sessions are included, how these can be booked, the window of time these should be used within and how long sessions are for. You may also want to set out what will happen in the cases where the client:
Has technical issues that impact the session (if the session is online)
Needs to reschedule
In addition, you should specify what will happen if you experience any of the above problems and how you will resolve these for the client.
You may use this part of the contract to offer recommendations for clients attending sessions, such as testing computer equipment in advance and ensuring privacy.
Arguably, ensuring you get paid for your services is the most important part of your business. Although most coaches go into the profession to help people, your business is unlikely to be sustainable if you're not making a profit.
Discussing fees can be awkward, especially in professions that revolve around helping people. Many life coaches find that defining fees in their terms and conditions is more comfortable, being that it is a formal business and legal document.
The ‘fees’ section in business terms for life coaches should encompass:
What the fees for your services are
Whether a deposit is required
When payments are due
How payments should be made
Furthermore, here is where you should set out what the process will be if a client fails to make payment on time. This may include cancelling bookings or suspending services. It should also include details on what your procedure is should a client fail to make payments, such as your right to add interest to invoices.
3. Data Protection
Data protection is very important but it can also be very scary and confusing, so allow me to simplify this for you. Data protection is about how you collect client information, how you use it and how you protect it. Therefore, this part of your contract should be focused on your commitment to securing your client’s personal information.
The Data Protection Act 2018 sets out your responsibilities in terms of data security and provides guidance on what should be considered and the key principles of corporate data protection.
More importantly, it is likely you will be collecting data about your clients health (especially if they discuss things like anxiety or past illnesses with you), and so you need to make sure this is being collected properly. Health data is known as ‘special category data’ and in most circumstances you will need to obtain express consent from your clients to collect and use this type of data about them.
You must understand your data protection commitments, as you are obliged by law to adhere to them.
One of the most important parts of business terms for life coaches will be confidentiality commitments. Clients may even skip straight to this part of your terms, hoping to be assured anything discussed in their sessions with you will remain confidential.
Your confidentiality agreement should confirm your commitment not to share any information disclosed in your sessions. However, it should also highlight circumstances where exceptions may be made.
As your reputation as a life coach will largely be established by what former clients have said about you, you should have a plan for how you will develop case studies and other content that serves as examples of how you work and the successes you’ve had, whilst maintaining confidentiality. Business terms for life coaches that are written specifically for those in the profession should include a statement that works to protect your clients whilst ensuring you can disclose non-specific information to promote the nature and scope of your services.
5. Cancellation Policy
Unfortunately, too many business owners develop a cancellation policy only after having a bad experience. Cancellation policies are crucial for life coaches as there is monetary value in your time. Therefore it must be protected. Accepting a booking with one client means you are unavailable to work with anyone else at that time. For this reason, it is important to ascertain how much notice you would need to be able to reasonably replace a cancelled booking. Partly, this should be the basis for your cancellation terms, however, you should also take into consideration what would be fair and reasonable from your client’s point of view.
Your cancellation policy should confirm:
How a client should cancel a booking
If, and under what circumstances, refunds will be issued
When refunds will be made
How rescheduling will be organised if requested
A cancellation fee isn’t intended to punish or reprimand a client in any way but to recoup a percentage of the costs you have incurred or the fees you have lost out on. Hence, your cancellation policy must be clear and direct. Remember, you can also choose to waive charges but you cannot necessarily enforce cancellation fees unless they have been specified in your business terms and conditions.
Business Terms Template For Life Coaches
Now I’ve explained this all, hopefully without all the legal jargon, it’s time to draft your business terms and put all that legal terminology back in. Life coaches have two choices in obtaining their business terms:
Hiring A Lawyer To Draft Your Business Terms
Working one-to-one with a commercial business lawyer to draft contracts is usually the best option. This ensures your terms are unique and specific to your business. An experienced lawyer, used to working with small businesses, will also ensure that you understand everything in your terms so that you are fully equipped and able to implement your policies.
Working with life coaches is something I specialise in and I would be pleased to help you draft your business terms. Please get in touch to discuss your legal requirements.
Use A Business Terms For Life Coaches Contract Template
Many smaller business owners, freelancers and coaches utilise templates to create their legal contracts. However, there are some very non-specific templates available online that may not suit your needs. Furthermore, it can be difficult to decipher the legal jargon and ascertain whether a downloadable contract is reasonable, enforceable or even covers what you need it to. Therefore, it's wise to seek a template tailored to your profession and guaranteed to be written by a commercial lawyer.
My Coaching Legal Template Package includes:
A recording of my Coaching Legal Masterclass which runs you through how to structure and protect your business, whilst ensuring you’re legally compliant
Coaching Business Terms template with coaching disclaimers and data consent tick boxes
This package is available for purchase and immediate download here