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What are IT Service Contracts?

Article Details
  • Written By: R. Kimball
  • Edited By: Daniel Lindley
  • Last Modified Date: 18 May 2019
  • Copyright Protected:
    2003-2019
    Conjecture Corporation
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IT service contracts are agreements among companies for the provision of information technology services. These agreements may include terms regarding the specific services to be provided, the term of the service contract, service level agreements with regard to different aspects of service, and a variety of other terms specific to the type of service provided under the agreement. Generally, the service provider has a form agreement used as the basis of the service contract between the parties.

A variety of technology services are provided by service providers. Some clients may choose to outsource their technology functions to one company, and other clients may choose to work with a number of providers. Each client may choose how it wishes to implement its technology infrastructure within its organization. Contracts between the client and each service provider are negotiated based upon the client’s technology infrastructure.

Each of the IT service contracts typically include the same basic terms. The basic terms describe the type of service provided under the given contract. Set time periods are included within the agreement for the length of the entire contract and for response times for specific activities under the agreement. A description of the process for initiating a project underneath the service contract is included within the basic agreement. Costs associated with and payment terms for each of the different services under the contract should be included in the service contract.

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Set terms associated with service contracts typically are a part of the agreement as well. These terms include the choice of law for the contract, the dispute resolution procedures for any problems under the contract, the termination procedures, and the specific definitions of terms for the contract. Depending upon the jurisdiction in which the contract is executed, there may be additional requirements within the contract, such as signatories, witnesses, notarization, or publication or registration with a government body. If a party to the IT service contracts is a governmental agency, then there might be additional terms and conditions required within the agreement.

Certain service agreements may have set service level agreements within the IT service contracts. A service level agreement varies based upon the services to be provided under the agreement. The service level agreement may require a description of the specific services, the time frame in which a response is expected and a resolution required, and any guarantee or warranty information. These service level agreements are individually negotiated between the parties to the agreement. They may also be negotiated as part of the services provided under the IT service contracts themselves.

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