Your degree of involvement in contracting may vary depending on the company you work for. For example, safety directors at small companies typically get involved in the actual contract writing of a contract, while at larger companies that chore is generally assigned to in-house counsel. But all safety directors have at least some involvement in making contracts, e.g., with suppliers and contractors. And they all tend to make similar mistakes. Here are a couple to avoid.

Pitfall 1: Handwritten Changes

Did you ever take a typed form contract and scribble changes onto it? That’s a big mistake. Handwritten changes raise all kinds of questions that can come back to bite you. For example, it’s often hard to read what the change says and figure out when—or even if—anybody agreed to it.

Lesson: Once you get your agreement in place, type it all up into a final document.

Pitfall 2: Oral Changes to Written Contracts

It’s not unusual for companies to sign a contract only to decide they want to change it later. In some cases, they reach an oral agreement and shake hands on the change. Or, if they’re paying closer attention to the legal niceties, one side may send the other a written and signed note describing the change. In each situation, the parties soon learn that the agreement they thought they had isn’t effective and that they’re stuck with the terms of the original contract.

Lesson: Generally, a written contract that’s been signed by both sides can only be changed by another written agreement signed by both parties. Oral agreements don’t work; neither does a letter signed only by one party to the agreement.

However, you can use a letter agreement signed by the sender to change a written contract if you add one line at the bottom of the letter stating something to the effect of: "I agree to the amendment set forth in this letter." The recipient of the letter must then sign the letter and return a copy of the signed version to the sender.

Conclusion

The best advice I can give you about contracting is this: Don’t be a hero. If you don’t understand the legal implications of what you’re doing, by all means get help from an attorney. While it’s true that attorney time costs money, it’s equally true that contract errors that aren’t corrected cost jobs.

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