Retainer Template

Stop losing money on Machinist projects.

Send your first 3 retainers for free. Stop letting your CNC machines sit cold and idle while waiting for clients who 'might' have work for you. If you don't charge for the capacity you reserve, you're paying for their flexibility out of your own pocket.

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Retainer Agreement

Ref: 2026-001 • Standard Business Template

1. Scope of Reserved Capacity

This agreement establishes a monthly reservation of machine shop capacity. The Machinist agrees to reserve [Number] hours of spindle/labor time per calendar month exclusively for the Client. This time includes machine setup, programming, actual machining, and quality inspection.

2. Retainer Payment and Minimum Commitment

Client shall pay a non-refundable monthly fee of $[Amount] (the 'Retainer'). This payment is due on the 1st of each month and guarantees the Client priority in the production schedule. This fee covers the availability of the shop, regardless of whether the Client provides work orders.

3. Unused Hours and Rollover Policy

To maintain shop efficiency, unused hours do not roll over indefinitely. A maximum of [Number] hours may be rolled over to the immediately following month. Any hours not used by the end of the rollover period are forfeited to compensate the Machinist for the reserved capacity that could not be sold to other parties.

4. Materials and Tooling

The Retainer covers labor and standard machine use. All raw materials, specialized jigs, fixtures, and custom tooling required for the Client's specific projects will be billed as a separate line item with a [Percentage]% markup for procurement and handling, due upon invoicing.

5. Excess Hours and Expedited Rates

Requests for work exceeding the monthly reserved hours will be billed at the Machinist’s standard hourly rate of $[Rate]. If the Client requires a turnaround faster than the standard lead time, an 'Expedited Surcharge' of [Percentage]% will be applied to those specific hours.

6. Termination and Cancellation

Either party may terminate this retainer agreement with [Number] days written notice. If the Client terminates without notice, the Retainer for the current and subsequent month shall be due in full to cover the loss of scheduled capacity.

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Uncompensated Opportunity Cost

Turning down a high-paying production run because a 'regular' client hinted at work that never actually materialized.

Tooling Inventory Bloat

Purchasing specialized end mills or fixtures for a recurring client who then pauses production without covering your carrying costs.

Unplanned Spindle Downtime

Fixed overhead costs (leases and utilities) continuing to accrue while the client delays providing final CAD files or materials.

What is a Machinist Retainer?

A Machinist Retainer is a legal agreement where a client pays a recurring monthly fee to secure a specific amount of shop capacity, spindle time, or labor. It ensures the machinist is paid for availability regardless of project volume and establishes rules for unused hours and priority scheduling.

Built from real freelance projects

This template is based on real-world scenarios across freelance projects where unclear scope, missing payment terms, and revision creep led to lost revenue. It is designed to protect your time, define expectations, and ensure you get paid.

Why Machinists need a clear retainer

For a machinist, time is literally money, but machine time is even more expensive. Between CNC lease payments, electricity, specialized tooling, and shop overhead, an empty schedule is a financial drain. A Machinist Retainer Agreement shifts the risk of scheduling from the shop owner to the client. It ensures that when a client says 'we'll need you next week,' they are financially committed to that time. This document formalizes the reservation of your shop’s capacity, protecting you from last-minute cancellations that leave you with no work to fill the gap. It also establishes clear rules for material surcharges and expedited 'rush' fees, ensuring that the recurring relationship remains profitable and predictable rather than a series of emergency fires you have to put out for free.

Real-world scenario

Mark runs a high-precision aerospace shop with two 5-axis machines. One of his largest clients, a drone manufacturer, frequently asked him to 'keep the schedule clear' for their monthly iterations, but they were notoriously late with files. In April, they sent nothing, leaving Mark with $12,000 in machine leases and no revenue. In May, Mark implemented this Retainer Template, requiring a 40-hour monthly minimum. When the client went silent again in June, the $6,000 retainer automatically billed, covering Mark’s overhead and allowing him to perform essential machine maintenance without financial stress. When the client finally sent the files, they respected his time more because they were already paying for it.

🛡️ What this retainer covers:

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Reserved Monthly Spindle Hours
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Priority Scheduling Window
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Unused Hour Rollover Limitations
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Consumable Tooling Procurement Terms
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Expedited Tier Pricing for Excess Volume
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Quality Inspection and Report Standards

Best practices for Machinists

Set a Rollover Cap

Never allow more than 10-20% of hours to roll over to the next month to prevent a massive backlog that kills your future capacity.

Separate Material Costs

Always bill materials and specialized tooling separately from the labor retainer to protect your margins against inflation.

Legal Disclaimer: MicroFreelanceHub is a software workflow tool, not a law firm. The templates and information provided on this website are for general informational purposes only and do not constitute legal advice.

Frequently Asked Questions

What happens if I can't fulfill the hours due to machine breakdown?

The agreement should include a 'Service Availability' clause that allows for a pro-rated credit or a scheduled makeup window if the shop is physically unable to perform the work.