Do I need an IT master services agreement (IT MSA)?
If the parties will be entering into a long-term relationship for B2B IT services to be provided on multiple occasions, then an IT master services agreement template can establish the legal framework to help the relationship run smoothly. You would not use this document for a short-term or one-off scenario, or for a B2C relationship.
A well-drafted IT MSA will outline the legal terms between a service provider and a customer for all future transactions. This will allow the parties to quickly enter into new engagements without the need to renegotiate legal terms each time.
What is a master services agreement for IT services?
An IT master services agreement is a contract that governs the relationship between a service provider and a customer. It sets out the essential terms and conditions between two or more parties that enter into multiple transactions or engagements. Within the master services agreement, the parties will agree on the principal legal terms that define how the parties will transact with each other, their key responsibilities and any expectations.
For a deeper dive into the world of master services agreements, explore our comprehensive guide.
Please note, this MSA template is applicable for services that include digital or technology services. If you are searching for an MSA template for transactions that will not involve digital or technology services, click here.
How are new services or projects agreed upon under the framework of a master services agreement?
The IT MSA provides the skeleton for the relationship between a service provider and a customer, and a statement of work (or purchase order as it is sometimes known) provides the “meat” of the specific services or project. Together they form the agreement between the parties.
The statement of work (SoW) is a separate legally binding agreement that details the scope of the services of a specific project and any relevant terms. Any points that are unique to a particular engagement will be detailed in the SoW. This will allow the parties to vary certain practical elements, such as the project timeline or a software specification.
Although the SoW is its own contract, it will also incorporate the terms of the master services agreement. As the master services agreement will contain the majority of the terms and conditions agreed between the parties; it is important to ensure the master services agreement is drafted and negotiated carefully to protect both parties' interests at the outset of the relationship.
Uncover the key differences between master services agreements and statements of work (SoWs) in this blog.
What are the benefits of using Docue's IT master services agreement template?
To save time and money: Once the IT MSA has been signed, the parties can contract without the need to continuously negotiate the legal terms for each new project. Only a SoW will be needed to commence each new project, so you can spend your time and resources on other areas of your business!
To start projects fast: If a framework of legal terms is in place, the service supplier can start providing the services based on the terms agreed in a SoW. A well-prepared master services agreement enables you to commence new projects quickly!
To simplify the business relationship and offer certainty: Once agreed, if there is any ambiguity or uncertainty relating to a SoW, the parties can refer to the more general terms of the IT master services agreement. The master services agreement can also be drafted to clarify which document will take precedence in the event of a conflict of terms, i.e. the more granular terms of the SoW or the more general terms of the master services agreement.
To manage risk and protect your business: A master services agreement gives a high-level snapshot of the parties’ overall business relationship and liabilities. It lays out any confidentiality provisions (i.e. that the parties won’t share any secrets with outside parties), intellectual property rights, limitations of liability and how the parties will resolve any disagreements. The master services agreement can also cover other areas that may be important for a party to include due to regulatory or statutory requirements, such as anti-bribery or data protection obligations. For more information about protecting your intellectual property rights in software, check out this blog.
Do you still have questions about your master services agreement template? We've got you covered with these handy FAQs.
This master services agreement template assumes that the relationship between the parties is B2B, that the supplier will be processing personal data on behalf of the customer, and that the agreement is subject to English law and the English courts.
What are some examples of where an IT master services agreement may be used?
Here are some real-life scenarios in which companies may use an IT MSA:
Managed hosting and cloud services: Many companies rely on third-party providers for managed hosting, cloud computing, and infrastructure as a service (IaaS) solutions. Using a master services agreement to govern the relationship between the parties can be used to outline the key legal terms between the parties, relating to the parties' liability, warranties relating to the services, termination of the agreement, etc, while each statement of work will set out the specific details of the services, licences or usage requirements, along with the supplier's charges and the applicable licence fees.
IT consulting and advisory services: Companies may engage IT consulting firms to provide strategic advice, technology assessments, and recommendations for improving IT infrastructure and operations. A master services agreement can formalise the relationship for IT consulting services, detailing important legal terms such as confidentiality obligations, IP ownership, etc. Each statement of work will set out the scope of services, deliverables, consulting fees, and confidentiality obligations.
Hardware procurement, software licensing and support services: Companies often require new hardware infrastructure, such as computers and mobile phones, along with licences for the software used by the business as part of its day-to-day operations. A master services agreement can include terms governing the supply of goods, warranty terms, installation services, software licences and any support services along with service level agreements provided by the supplier. Details of any hardware specifications, pricing, delivery schedules and support and maintenance services can then be outlined in each applicable statement of work throughout the parties' relationship.
What are the key terms that this master services agreement template includes?
Key terms: This master services agreement template includes the following key provisions:
• The term of the contract;
• The parties’ responsibilities;
• Acceptance testing provisions;
• Charges and payment terms;
• Change order process;
• Supply of goods (if applicable);
• Support services (if applicable);
• Warranties;
• Liability;
• Intellectual property rights (IPR) and IPR indemnities (if applicable);
• Termination;
• Non-solicitation clause (to ensure your best talent is protected!); and
• Governing law and jurisdiction.
Learn more about the essential key terms included in our master services agreement template by reading this guide created by qualified lawyers.
Related agreement templates
When should the statement of work template be used:
The statement of work template should only be used once the legal framework between the parties has been agreed upon (i.e. the master services agreement). After the IT master services agreement has been finalised, one or more SoWs can be prepared to set out the scope of the services and all of the relevant terms to the project. Once the content is agreed and the SoW is signed, the parties can commence the services. You can find our Statement of Work template here. You can also find out more about how these two templates work together harmoniously to create a more streamlined contract process in this guide.
When should a services agreement be used instead of an IT master services agreement template:
If you're considering entering into a business relationship for a one-off transaction with another company, a services agreement may be a more suitable choice than a master services agreement.
A services agreement is a simpler, more concise contract that defines the terms and conditions for a specific project or service. This template is ideal when you don't anticipate an ongoing, long-term relationship with the other party and want to keep the agreement focused on a single transaction. You can find our services agreement template here.
On the other hand, an IT master services agreement, as mentioned earlier, is designed for situations where multiple transactions or projects involving digital services are anticipated between the same parties over a more extended period. It establishes a broader framework for the relationship, with specific terms outlined in separate SoWs for each project.
Docue gives you options to tailor this master services agreement template to meet your business needs
Customise our templates to suit your circumstances: This master services agreement template contains alternate clauses depending on whether you are the service provider (known as the supplier) or the customer. You can easily select different options throughout the template to cater to the circumstances of your contractual relationship. If you are currently in the process of negotiating a master services agreement, learn how to navigate negotiations with confidence with this helpful guide.
Favourable terms: Your contracts are your company's legal armour, protecting your most important assets, such as your intellectual property. Without it, your business may be exposed to liability. For this reason, it's always best to get your contracts in writing with terms that benefit you. Depending on the party that you are acting on behalf of, Docue gives you the option to select terms that are more favourable for your business in the master services agreement template. To find out more about protecting your intellectual property in your master services agreement template, check out this blog curated by our legal experts.
Strengthen your business relationships: A well-drafted master services agreement template can enhance supplier/client relationships by establishing clear expectations, roles, and responsibilities. This clarity reduces misunderstandings and builds trust and transparency. It also sets performance standards and quality metrics, ensuring the supplier delivers as promised, which boosts the client's confidence. For more guidance on how to use your contracts to strengthen business relationships, check out this article.
Why use Docue?
Simple: Docue is easy to use and can help you create a high-quality master services agreement template without the typical hefty legal bill. Our template bank of 120+ lawyer-drafted templates covers a wide range of business scenarios to suit your needs.
Safe: Once you have created a contract that is tailored to your business needs, you can send the contract to each of the parties for e-signing. After the contract is signed, you can store the agreement in Docue’s storage vault, Docue Drive, to ensure you always have quick and easy access to your contracts in one place.
Affordable: Our pricing is cost-effective and transparent, with plans that are designed to suit your business.
Tags: IT master services agreement, IT framework agreement template, IT services agreement.
