Module 3 Task 7

Take the quiz. Answer the true/false questions first. Then, read the text on the purpose of the contract (see Learning Point 4) or watch the video material (Video 4) to confirm your choices. Check with the Key.

LEARNING POINT 4: PURPOSE OF CONTRACT  

Every contract as an act of communication is meant to serve three main purposes that may be referred to as: PROTECTION, PERMISSION, POWER (see e.g. Tudor, 2015).

The first reason why we need a well-negotiated contract is PROTECTION. Both parties of the contract are protected by the rules/regulations, points of reference, or frames of reference stated in that agreement—some of which constitute the non-negotiable regulations (quite often legal) and some other—the negotiable points. In case of some doubts or confusion, we may always go back to the non-negotiable rules, which will help us find the baseline of our mutual agreement, and revise the negotiable rules—are they still valid? Do they serve their purpose? Or maybe we need to renegotiate some points. Usually, when we enter a foreign country, the non-negotiable points relate to the law of that country and the social rules that help us navigate social life. It might be interesting to learn the similarities and differences regarding that aspect. 

PERMISSION is the second reason for having a well-negotiated contract. It establishes what is allowed if there is any space for creativity, autonomy, and experimentation in the line of our cooperation. It may be referred to as a breathing space between the partners. Quite often, formal contracts may take the form of a list of all permissions the workers/students want to have in the business or educational institution. In the cultural context, the permissions may refer to cultural differences in approaching the realisation of tasks that require the contracting process. It may be important for both parties of the contract to discuss how realistic these permissions are considering the rules, which refers back to the question of protection.

The third reason that underlines the importance of a contract is POWER, which is understood as empowerment. Who is empowered by this contract? Do both parties feel energized and competent? What do we all get in the end from this agreement? On the other hand, who feels powerless or powerful? In this case, the contract is probably not a mutual agreement but is founded on a one-sided, imposed set of rules that were not consulted with the other party. Finding balance in the rights and responsibilities ensures that everyone involved signs the contract with confidence and trust.

For the contract to be valid, all members of the cooperation need to show verbally or non-verbally that they accept the contract. They may sign it, raise their hands, or nod. Oral agreements should be well respected as written ones.