A master services agreement (MSA) is sometimes called framework agreements. They’re commonly used to outline the scope of services between two or more parties. MSAs allow the parties to create a contract framework for their future agreements. The terms and conditions in the initial contract are referred to when entering into sub-agreements under the MSA (commonly referred to as “Statements of Work,” “Order Forms,” or something similar).
Here’s what you need to know about MSAs and how to use them.
What is included in an MSA?
MSAs help one party (the provider) provide services to another party (the client). Your company may be the service provider or the client, depending on whether you’re engaging with vendors.
MSAs need to be customized for the parties and projects involved. It’s important to avoid using generic template agreements. Because the MSA acts as a high-level scaffolding for the business relationship, you will need to define the details of the project. This includes the scope of work to be performed, payment terms, change order processes, dispute resolution, and how the agreement or any particular statement of work (SOW) can be terminated.
When to use a master services agreement?
Master services agreements are particularly useful when a project will involve multiple stages, or when you plan to continue working with a particular client or provider in the future. If you’re not sure whether to use an MSA or a plain services agreement, consider the following.
When deciding whether to use an MSA, you’ll need to determine whether the terms of the MSA should take precedence over the statement of work, or whether the terms of the SOW should take precedence over the terms of the MSA, in the event the terms of the MSA and SOW conflict with one another. This is an important consideration because often non-legal team members (e.g., sales representatives) will assist in populating the SOW.
If you want to afford your team members flexibility in defining the terms of the SOW, you should have the SOW govern. If you want to limit your team members on the terms they can add or change in the SOW, have the MSA govern.
SixFifty’s MSA generator also provides a third middle ground option, where the MSA governs unless the SOW expressly provides that it will override the MSA on a particular term. This saves time later, should you need to change the terms of the agreement for just one project or phase.
What is the difference between a services agreement and an MSA?
A standard services agreement is similar to an MSA, with one major difference: whereas a standard services agreement contemplates only a single project-based or ongoing engagement between the client and the provider, an MSA contemplates that there may be multiple service engagements or projects each under a separate statement of work. This enables providers and clients to save time on drafting future agreements.
Master services agreement template
Companies often wonder if there’s an MSA template available, so they don’t have to hire a lawyer or burden their own in-house legal team. Unfortunately, using a generic one-size-fits-all template lacks the precision and customization MSAs demand. That’s why SixFifty created an MSA generator. You can create custom MSAs, simply by answering a few questions.
The MSA generator allows you to choose whether the terms of the agreement should be pro-provider, pro-client or neutral between all parties. After you fill out the requested information, the software also generates a form of SOW and a form of change order (a form that should be used by the parties if ever they want to make a change to an SOW) you can use with your MSA.
Generate a customized master services agreement with SixFifty
When you want to save time and money drafting legal documents, SixFifty’s automated legal tools make a big difference. All you have to do is fill in the requested information and our software will automatically generate a custom MSA, SOW, and change order. It’s the fastest, most cost-effective way to create a personalized MSA.
Ready to get started? Schedule a product demonstration with SixFifty to see the document generator in action. Create your own customized master services agreement today with a Business Docs subscription or à la carte in the SixFifty Marketplace.