Most commonly, a Terms of Service agreement shows up as one of the lines of small print on the bottom of a Web site, along with copyright notices and a privacy policy link, but don't let that fool you. A ToS is a critical document for any service provider.

In a nutshell, a ToS is a contract between the customer and the service provider, and it lets you, as a service provider, detail exactly what you're promising to deliver and what legal obligations you have in terms of accuracy, timeliness, etc.

The CNN Online Terms of Service Agreement

Depending on what type of service you plan on offering, you might include a ToS with your packaged goods (have a close look at the first few pages of the manual included with your next software purchase) or might require a client to print and sign the ToS before delivering your service.

One class of service provider takes the ToS particularly seriously: ISPs. For an ISP, a Terms of Service Agreement lets them specify the guarantee of availability, throughput speed, etc. Smart ISPs also use their ToS to detail expectations of user behavior and activity too, including clauses like "use of our service to send spam is considered grounds for immediate termination of your account without a refund."

AOL's combined ToS and copyright notice

Most critical in any terms of service agreement is to endeavor to indemnify yourself by clearly stating the limits of what you guarantee for your service.

Next up: navigating the rocky waters of employment agreements, both for contract workers and fulltime staff.

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