MSA Review Checklist: What to Check Before Signing a Master Service Agreement

What is a Master Service Agreement?

A Master Service Agreement (MSA) is a framework contract that sets the terms for an ongoing relationship between two parties — typically a service provider (freelancer, agency, vendor) and a client. Individual projects or engagements are then handled through separate Statements of Work (SOWs) that reference the MSA.

Because the MSA governs the entire relationship, its terms can affect every project you do together. A bad clause in an MSA can create problems on every SOW that follows. This makes the MSA review more important than any individual project contract.

MSA review checklist

Payment and invoicing

• What are the payment terms? (Net-30, Net-60, upon completion?)
• Is there a late payment provision or interest on overdue invoices?
• What is the invoicing process — are there approval requirements that could delay payment?
• Are there conditions under which the client can withhold payment?
• Who pays for out-of-pocket expenses, and is there a reimbursement process?

Intellectual property

• When does IP transfer? Upon delivery or upon full payment?
• Does the IP transfer include all work product, including drafts and concepts?
• Does the client claim rights to tools, frameworks, or methodologies you bring to the engagement?
• Are you permitted to use the work in your portfolio?
• Are there any license-back provisions that let you use the work after the engagement?

Termination rights

• Can either party terminate the MSA for convenience (i.e., for any reason)?
• What is the notice period for termination?
• What happens to in-progress SOWs if the MSA is terminated?
• Is there a kill fee or compensation for work completed at time of termination?
• Are your termination rights symmetric with the client's?

Liability and indemnification

• Is there a cap on liability? (Usually a good thing — caps your exposure to a reasonable amount.)
• Is the indemnification clause mutual or one-sided?
• Are you being asked to indemnify the client for their own negligence or misconduct?
• What types of damages are excluded? (Consequential, indirect, lost profits?)
• Are there any uncapped liability provisions?

Confidentiality and NDA

• What counts as confidential information?
• Are there standard carve-outs for publicly known information?
• How long does the confidentiality obligation last?
• Can you disclose information if legally required?

Non-compete and exclusivity

• Are there any restrictions on working with competitors?
• Is there any exclusivity obligation — can you only work with one client in this space?
• How long do any restrictions last after the MSA ends?

Change orders and scope

• How are changes to scope handled?
• Is there a change order process that requires written approval before additional work is done?
• What happens if the client requests changes verbally — are you protected?

Governing law and disputes

• Which state's laws govern the agreement?
• Where must disputes be resolved? (If it's far from you, litigation becomes impractical.)
• Is there a mandatory arbitration clause?
• Are class action rights waived?

Common MSA red flags

• IP transfers before payment is received
• One-sided termination rights — client can terminate for convenience but you cannot
• No liability cap for the service provider (you)
• Uncapped indemnification for third-party claims
• Net-60 or longer payment terms with no late payment provisions
• Broad non-compete that restricts your entire industry
• Client's right to unilaterally modify the MSA

MSA vs. SOW: which governs?

Most MSAs specify that in the event of a conflict between the MSA and a SOW, one takes precedence over the other. Check which document wins in a conflict. This matters because clients sometimes try to negotiate favorable terms into individual SOWs that override the protections in the MSA.

Ideally, your MSA should establish the minimum protections that apply to every engagement, with SOWs adding project-specific details only.