What a statement of work adds to a services agreement

In one line. A statement of work describes the job; the services agreement above it describes the relationship, and the two papers are usually written apart so the job can change without the relationship being renegotiated.

People meet the pair the first time a client sends two attachments for one piece of work. The first is long, general and full of clauses about liability and confidentiality. The second is short, specific, and reads like a plan. The question that follows is reasonable: why is this deal in two documents?

Why the work gets described twice

It is not described twice. It is described once, in the second document, and the first one never describes it at all.

A master services agreement — an MSA — sets the terms that hold across every job the two sides might do together. Who owns what is made. How confidential information is handled. How invoices are raised and when they are paid. How either side ends the arrangement. What law the words are read under. None of that changes when the work changes.

A statement of work sets out the job itself: what is being done, by whom, to what shape, by when, for what. That does change, every time, and putting it in the same document as the standing terms would mean reopening the standing terms every time it does.

So the split is practical rather than legal. One paper is signed once and stays still; the other is written per job and expected to move.

Is SOW the same as a contract?

Not usually. A statement of work is normally one document inside a contract rather than the contract itself, and which of the two a given SOW is depends on what the papers say about each other — which is why both usually say something.

An SOW is commonly written to sit under an agreement that already exists. It refers to that agreement by name and date, and it takes the standing terms from it rather than repeating them. Read on its own it can look thin, because it is: the parts that are missing are the parts that live upstairs.

An SOW can also be written to stand alone, carrying the terms it needs inside it. That is common for a single small job between two sides who do not expect a second one, and it is closer to a consulting agreement or a plain services contract in shape.

The two arrangements are not distinguished by the word on the front. They are distinguished by whether the document points at another one and takes its terms.

What sits in the SOW and not in the MSA

The dividing line is usually the same, whoever drafted the pair.

In the statement of work: the description of the work, the deliverables and what counts as one, the dates or the milestones, who is doing it, what the client has to supply for it to be possible, the fee for this job and how it is triggered, and anything unusual to this piece of work — a named tool, a named site, a named person.

In the master services agreement: confidentiality, intellectual property, warranties, limits of liability, indemnities, insurance, termination and notice, subcontracting, data handling, and the governing law clause that says which body of law reads all of it. That clause covers every statement of work made under the agreement, which is a large part of why the pair is arranged this way — you name it once. What governing law decides goes into what that line is actually for.

Where the papers disagree, most agreements carry a line saying which one wins. It is usually the MSA, with a carve-out letting a statement of work vary named terms if it says so explicitly. Where it sits, and how far it goes, is worth reading before signing the second one.

When a statement of work is signed on its own

Two situations come up often.

The first is a new job under an agreement that is already in place. Nothing about the relationship is being renegotiated, so only the SOW is signed, and it names the agreement it belongs to at the top. This is the arrangement the pair exists for.

The second is a change to a job already under way. Scope moves, dates move, a deliverable is added. Depending on how the pair was drafted this is a new SOW, an amendment to the current one, or a change note the SOW itself provides for. In each case the change is written down and signed by both sides rather than agreed in a thread — a version of a document is a fixed thing, and a signature attaches to one.

An SOW signed on its own is still signed. Agreeing to the shape of the work in a call and putting a name to the paper are two separate acts, which is the whole of another post.

At the door. contracts.io makes paper, not legal advice. Describe the standing arrangement and read back a master services agreement; describe the job and read back a statement of work that names it. Both name their governing law from the same list — England and Wales, New York, Singapore or any other on the governing law page. If you are the one being handed the pair rather than writing it, freelance contract or contractor agreement covers the other end of the same deal.