Agent Agreement

An Agency Agreement, also sometimes called an Agent Agreement, is a document between two parties, a principal, and an agent. With this agreement, the principal gives the agent the authority or capacity to do certain things on behalf of the principal. In many cases the agent is given the authority to create or affect legal relations between the principal and third parties. However in some other cases, this involves the agent simply being authorised to make representations on behalf of the principal.

Within this Agency Agreement, the principal and agent outline their expectations for the agency. They clarify the terms between the agent and principal, including the rights and obligations of each party.

An Agency Agreement is different from an Employment Agreement. The relationship between a principal and an agent is different from that between an employer and an employee. It is important that when parties are creating the agency relationship, they do not create an employment relationship. In an employment relationship, the employer has additional obligations including such things as workers' compensation, superannuation, annual leave, sick leave and long service leave.

In order to avoid creating an employment relationship, the parties may wish to consider the following:

• if possible, the agreement should be consistent with it being a contract of service (rather than an employment contract).
• the Agent should not be under the Principal's control in terms of the manner of performing the work.
• if possible, the Agent should be hired to produce a result (for example, sell a certain number of products) rather than to provide a particular service (for example, be present at the sales stand for a certain number of hours).
• if possible, the Agent should be paid for results (for example, a fee per sale) rather than being paid for time worked (for example, an hourly rate).
• the Agent should be allowed to engage third parties (such as employees or subcontractors) to assist with providing the services.
• the Agent should be responsible for paying his or her own insurance and taxes.
• the Agent should not present him or herself in public as a part of the Principal's business.
• if the Principal has to dictate certain things about how the Agent may provide the services, it may be best if this is done through the use of restrictions (for example, by saying that the Agent is not allowed to do certain things) rather than through specific directions (for example, by saying that the Agent must act in a certain manner).

If in doubt, seek legal advice.

How to use this document

Enter the relevant information in the form when prompted including information about the parties, about the nature of the agency relationship, and about any fees that the principal might be paying to the agent.

In an Agency Agreement, the parties will be able to provide various details of the parties' relationship, including such things as a description of the services that the agent will be performing, as well as the general business of the principal, and how the principal is expected to pay. This Agency Agreement can also deal with dispute resolution and governing law.

After inputting the required information, print the Agreement and have it signed by both parties. The parties can both keep a copy on file for their own records.

Applicable law

The general principles of agency in Australia arise out of the common law. Common law principles of contract law may also apply.

In addition, many forms of agency are also affected by specific legislation in Australia. For example, real estate agents, auctioneers, tax agents, finance brokers, travel agents, mercantile agents, insurance agents, and various other agents, may all be affected by industry specific legislation at the state or commonwealth level.

In addition, in some cases the Australian Consumer Law which is set out in the Competition and Consumer Act 2010 (Commonwealth), may also apply.

If in doubt, seek legal advice.

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