The Westminster Confession of Faith gives us nice summaries of these two kinds of covenants.
The first covenant made with man was a covenant of works, wherein life was promised to Adam, and in him to his posterity, upon condition of perfect and personal obedience.
Man, by his fall, having made himself incapable of life by that covenant, the Lord was pleased to make a second, commonly called the covenant of grace, whereby He freely offereth unto sinners life and salvation by Jesus Christ, requiring of them faith in Him, that they may be saved; and promising to give unto all those that are ordained unto eternal life His Holy Spirit, to make them willing, and able to believe.
In the pages of the Bible there are these two basic types of covenants. In the Covenant of works, God and man have a relationship where man has a duty to perform for a wage to earn, namely eternal life. In the covenant of grace, God and man have a relationship where God promises to perform the duty of giving man eternal life.
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