According to michalsons SLA Guide (, an ALS is an agreement that describes the services (not goods) that one company will make available to another. When goods are delivered, an ALS is not the right contract. It`s a kind of contract, and in the IT context, it`s a computer contract. John Giles, executive counsel at Michalsons: "In South Africa, there is a lot of confusion about service level agreements. People seem to have different understandings of who they are and why they should exist. There are many types of service level agreements that baffle the problem. Chetty commented: "The escalation clauses are essential for the IOC. CIOS are often extracted from the day-to-day engagement with IT service providers. The IOC needs to know when service and performance issues need to get worse. An ALS is a kind of contract (even if it is called an agreement) and contract law is therefore the most applicable right. Contract law is based primarily on the common law (such as case law).

There are many cases where there have been recent things like: Once service levels have been determined, it is necessary to look at the effects of non-compliance, and the amount of compensation must be determined. Negotiations often focus on the compensation the claimant must pay for lost benefits (whether in the form of penalties, service credits or damages). SLAs must indicate what service a customer can expect, when, how, how many times downtime can be expected, and what corrective action can be taken if the provider does not deliver on one of its promises. In reality, they are often confusing and complicated documents that really do not help either the service providers or the client in managing the relationship, especially when things go wrong. According to Michalsons, to create a working ALS, you need to define: — the service to which ALS applies – a number of criteria or objectives, to determine the levels of service that can be used to measure whether your goals have been met, for which ALS is valid, the responsibilities of each person involved, as service levels are measured (if they cannot be measured, there is no need to have a level of service) – perform actions to be performed if service levels are not met (for example. B service level credits).