Service Level Agreements (SLAs) are agreements between a service provider and a client (usually found in a SaaS Agreement or Master Services Agreement) that outline the expected performance metrics and levels of service to be provided.
SLAs typically specify measurable performance targets for the services provided, such as:
- Uptime: The percentage of time the service or system must be operational (e.g., 99.9% uptime).
- Latency: The amount of time it takes for a service to respond to a request or perform a specific action after it has been initiated.
- Support Responsiveness: The number of minutes, hours, or days before the provider’s customer service team will respond to and resolve a technical issue.
Often, SLAs include “service level credits” as a remedy if an SLA is breached, usually in the form of a refund of a percentage of the monthly subscription fee. If you are a provider offering an SLA and service level credits, you want to ensure that these service level credits are the customer’s exclusive remedy for missing SLAs, so that the customer cannot also seek breach of contract damages. If you are a customer, you of course do not want this to be the exclusive remedy and want the option to seek damages and/or terminate the agreement if the provider continually fails to meet SLAs.