Contracts, Employment Law

What Documents Should My Team Sign?

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As your business begins to grow, you’ll have indep Calzoncillos Calvin Klein España end ent contractors working on projects. Eventually, you may bring on an employee or two. Before you know it, you’ll have a bustling team working for you. Congratulations! You’re now officially the owner of a growing business.

Now the bad news: there’s a certain amount of red tape that comes with bringing on new team members. Full-time employees create the most work on your end, since you’ll need to worry about taxes, health insurance, and any number of other issues. But even with interns and independent contractors, you’ll need to protect yourself and your company by having them sign certain documents.

Which documents should I have my team sign?

There’s no blanket answer to this question: it depends in large part on the circumstances and who is sitting on the other end of the table (for example, employee, independent contractor, intern, or partner/collaborator). That said, here are just a few documents that you may want your team member to sign:

  • Nondisclosure agreement (NDA): An NDA sets forth specific information that you plan to share with the other party, and requires that they keep the information confidential. NDAs are very common, and as a best practice, it’s wise to have anyone that will view any internal company information sign one before getting a seat at the table. Regardless of whether the other party is an independent contractor, employee, or potential collaborator, if you don’t want them to steal your information, it’s a good idea to have them sign an NDA.
  • Covenant not to compete: This is a promise by the other party that they won’t open a business that competes with yours, or, in some cases, go work for one of your competitors. Covenants not to compete can be tricky to enforce, as courts don’t like to validate agreements that last for an especially long period of time, or cover a large geographical area. For that reason, it’s important to draft your covenant not to compete so that it’s sufficiently narrowly-tailored to protect your business while still being enforceable.
  • Independent contractor agreement: An independent contractor agreement sets forth the terms for any work you give to an independent contractor, including the duties for which they’ll be responsible, their hourly rate, liability and indemnification, how either party can end the relationship, and any warranties given by you or the independent contractor, among many other things. The agreement also explicitly states that the contractor is not an employee, and therefore isn’t entitled to health insurance, tax withholding, or any of the other benefits that come with an employer-employee relationship. The agreement also states that the contractor won’t have the authority to act as an agent for your company.

Depending on the situation, all, some, or none of the above documents may be appropriate. By the same token, there are many other contracts and agreements that you may want your team members to sign. It depends on the type of work you’re doing and who you are working with. Check with your attorney to see how to best protect yourself and your company when bringing new people on board.

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