Service Level Agreement (SLA)

Formal

An arrangement whereby one party to a contract agrees to provide a detailed level of services to the other party. The SLA contains the performance levels required to meet the standards of the contract.

Real-world Example

A software vendor commits to 99.9% uptime and a 4-hour response time for critical issues in its SLA - a contractual agreement defining the standard of service the customer can expect, often with penalties if it's not met.