Small business owners are busy professionals with a long task list. Often lost on the to-do list is securing the contracts that contribute to long-term success—and prevent negative legal issues later. Fortunately, the task doesn’t have to be cumbersome if the right legal professionals are consulted. Note, too, that there is value in consulting a local lawyer knowledgeable in local regulations.
This list of business contracts is not inclusive; there are other business contracts necessary for day-to-day operations. To get a comprehensive list and customized contracts, contact an experienced business lawyer.
Partnership Agreement
Drafting a Partnership Agreement is an important step in starting a business (including choosing an entity, more information here) that can have long-term ramifications. A Partnership Agreement is between all parties that invest in a business and should include the financial details, rights, and responsibilities.
The Partnership Agreement should detail the parties involved in the business, how profits and losses are handled, steps to be followed if a partner wants to leave the business, duties of each party, conflict resolution steps, and any process information for adding a partner. Because the details in the document need to be as specific as possible, contact a lawyer to draft this important contract. The absence of a Partnership Agreement may lead to serious conflicts and legal situations that could have been prevented.
Independent Contractor Agreement
Outsourcing services is an essential step for most small businesses. After all, there are some processes that make more financial sense to outsource as opposed to hiring an employee (and incurring those costs). In addition to independent contractors, this contract can also be used to short-term employees and consultants. An Independent Contractor Agreement details the exact nature of the relationship and that the business is not responsible for financial and tax obligations incurred for an employee.
Employee Offer Letter
Hiring an employee is a process that should be formalized before the first employee is hired. This eliminates any situations that can turn into a headache later, both legal and financial. An Employee Offer Letter explicitly spells out the details of the job, such as the position title, responsibilities, and finances. “At will” language should be included to indicate that the position can be terminated by the company or employee. The Employee Offer Letter should also specify other details, such as conflict resolution and that a Confidentiality Agreement should be signed.
Confidentiality Agreement
A Confidentiality Agreement is a vital part of business asset protection. This contract ensures that business proprietary information is kept confidential. This document should be signed by any party (employee or otherwise) that needs access to proprietary information or may develop products, strategies, or services that may become proprietary.