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If you’re engaging a service provider or offering services yourself, you may have heard the term “service levels”. In today’s fast‐paced business environment – particularly in 2025 – maintaining clearly defined service standards is more important than ever.
In any service business, a client will expect a minimum level of quality and consistency from their provider. In industries such as marketing and technology, these expectations are commonly encapsulated in what we call “service levels”.
To ensure the service provider commits to these standards, service levels are often set out in writing as part of a Service Level Agreement (SLA). This written record helps to hold both parties accountable as business practices evolve.
But what exactly is a Service Level Agreement, anyway?
What Is A Service Level Agreement?
A Service Level Agreement (often abbreviated as “SLA”) is a contract that specifies the minimum level of service a client can expect from their provider. It outlines key performance indicators (KPIs), response times, availability targets and other measurable metrics that ensure your service delivery stays on track.
The easiest way to understand an SLA is through an example.
Imagine you run a creative agency that designs and develops websites for clients. While your general Service Agreement outlines roles, responsibilities, payment terms, and other essential clauses, an SLA is introduced for more sophisticated projects. It specifically details the service levels required – such as guaranteed response times for website issues or bug fixes.
For instance, your client might stipulate that any website problem is addressed within a set number of hours. By documenting these expectations in the SLA, both you and your client are crystal clear from the outset about performance standards and the timing of responses.
Often, an SLA will also detail the consequences of failing to meet these standards – including provisions for service credits, partial refunds, or other remedies.
How Do I Use A Service Level Agreement?
An SLA typically works alongside your general Service Agreement. In many cases, your SLA is included as a dedicated Schedule appended to your Service Agreement, providing a clear, separate outline of the service levels.
This setup allows you to maintain a standard Service Agreement while having a distinct section that focuses purely on service performance. For particularly sophisticated projects, you might decide that a longer, stand-alone SLA is more appropriate.
When drafting your SLA in 2025, consider incorporating modern elements such as digital performance metrics and cybersecurity KPIs. Many contemporary SLAs now include provisions for remote support and cloud services – ensuring they are as robust and adaptable as today’s technology demands. In addition, periodic reviews via a contract review can help update your agreements as industry standards change.
It is also not uncommon for SLAs to intersect with other IT contracts. From Managed Services Agreements to Master Services Agreements, ensuring consistency across your contracts is key. If your service provision requires adjustments over time, you might use a deed of variation to update the SLA without renegotiating the entire contract.
What Can I Find In A Service Level Agreement?
While the content of an SLA can vary depending on the project and your client’s expectations, there are several standard components that most agreements include:
- Response Times – detailing the expected time frame in which the service provider must respond to client issues.
- Up-Times or Availability – particularly relevant for IT services, this clause sets out the minimum online availability required for hosted services or websites.
- Consequences for Non-Compliance – specifying remedies such as service credits or partial refunds if the agreed service levels are not met.
Staying Up-to-Date with Your Service Levels
In 2025, it’s imperative to regularly review and update your SLA to ensure it reflects current industry trends and technological advancements. For example, many service providers now include provisions covering data security protocols and remote support for cloud-based applications. A periodic review of your contracts can help you identify areas for improvement and keep your agreements competitive.
This proactive approach means you can adapt your SLA to evolving expectations without needing a complete overhaul. In practice, minor updates can be made using a deed of variation, ensuring that your service commitments remain robust and legally compliant.
Need Help With A Service Level Agreement?
Whether you need to include an SLA schedule in your Service Agreement or require a stand-alone document, our team is here to help tailor your contracts for today’s market.
As a best practice, it’s always a good idea to consult with an experienced lawyer who understands your industry and its unique challenges. Our guide on choosing the right lawyer can provide additional insights to ensure your agreements are both compliant and effective in 2025.
Our legal team at Sprintlaw is well versed in drafting and reviewing these types of contracts. Don’t hesitate to have a chat with us on 1800 730 617 or drop us a line at team@sprintlaw.com.au if you need assistance.
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