People in the U.S. are mostly used to paying for products and hiring employees. While there are business to business agreements between large organizations, the concept of small organizations providing services to businesses of all sizes can seem new to a lot of people.
Service businesses don't necessarily advertise their business to the public, they may not have enough workers to take on new business without notice. They definitely take the time to make sure the work specifications are well understood by all parties before a payment is exchanged. They don't intentionally break agreements and request meetings when this happens to discover how to mend the agreement or terminate the relationship without injury. Taxes are normally up to date and paid on time and there is some form of compliance or regulatory environment that produces an expected level of work quality.
Most services start with a request and an agreement, either the worker is inquiring about a request that was posted somewhere such as a job board, work description, or request listing or the worker is responding to an inquiry made directly to them such as a phone call or email that was used after viewing a website or business card.
The worker is responsible for understanding the request, making a service proposal, completing the work to specifications and agreements, requesting the correct amount of payment, and paying the appropriate taxes on the services.
While the work is being completed, the worker is responsible for following standards. Nearly all service work has a minimal set of standards that must be followed in order to offer certain types of services. While services can have standards that exceed the minimum requirements, they can not go below the minimum requirements without putting themselves at risk of breaking the service agreement. This is viewed as a responsibility to correctly represent the quality of service being offered and to explain how it relates to the minimum service requirement.
Few workers will agree to a work specification that is above their qualification level, unrelated to the services they are offering, or without a sufficient amount of workers to complete the work before the agreed upon date.
Working outside of this context creates liabilities. These are possible costs a service worker may have to incur to reimburse payments for work not completed to agreement or that is below a minimum standard and viewed as misrepresentation.
Most service workers are self insured, even if they have an insurance policy, the first step is to redo the work or reimburse for unfinished work. The insurance will pay for someone else to complete their work but they will often require the worker to agree not to continue offering such services in order to keep their insurance policy.
The final liability is warranty, in providing quality services, a service worker may have to guarantee that their work is sufficient to meet requirements for a certain period of time. This means that they filed the correct paperwork, reviewed all the data, and made the appropriate recommendations, completing the work to specifications and expectations representative of the service agreement.
Most agreements resemble a work order. There is a request, a specification, an agreement, and an inspection that verifies the work was completed as agreed. In a more professional environment there is a request, an inspection or interrogatory, a proposal, a meeting or hearing, an agreement, and then the various work phases. During each phase, the work is often inspected for quality to make sure the agreement is still valid and that the work so far is satisfactory or exceeded expectations. This also provides the opportunity to ask about changes to the service agreement or to plan for an upcoming project once the current project is complete. Many service agreements are viewed as tasks, projects, or work orders.
An agreement can have amendments, addendums, or additional agreements that are part of an initial agreement that was made for services.
During the different phases, payments are made as parts of the agreement are marked as satisfactorily completed. Before the final payment is made, the agreement is marked as completed to satisfaction and there may be some final paperwork submitted indicating that the project is done and the service worker is no longer liable or responsible for any work related to the agreement.
In the event that work was omitted or that something changed related to the agreement after the work was marked as completed, a warranty is available. These often last 5 years but can be modified with agreement. It does not cover modifications to the work done by others after the agreement was marked as completed, but this can result in a work order. An inspection may also determine that even though the work was modified, some or all of the discrepencies in quality would be covered by the warranty. This is often because it may be implied that other people would add to or make modifications to the work within the 5 year period. It would vary and be examined on a case by case basis, by default modifications to a work result in a lack of liability.
Services imply that a person is not an employee, however it is possible to have an ongoing agreement for services that lasts 2-3 years. This will often not be an exclusive agreement by default meaning the same services can be offered to other businesses including competitors. In contrast, independent workers must often assess whether there is a conflict of interest before accepting or agreeing to work. This is because they may be working with organizational data that is specific to an organization that can not be reused with a competing organization without breaking service agreements on conduct, ethics, quality, and compliance.
Ongoing service work is possible for up to 10 years with most service workers and work longer than this might require a service assessment or the work might need to be transferred to somebody else or a different organization. The stipulation is that the ongoing service requests are a justified expense and provide an ongoing benefit for the organization.
Published: 2026-01-01
Last Updated: 2026-01-01
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