Hold Your Horses!

Once you have incorporated your new company you will be excited  to get things running as soon as possible. However, before its ‘off to the races’ it is crucial that ironclad  contracts are implemented protect you and your business so that it can expand quickly and safely. In this article, examples of essential  business contracts you will need for your growing business or startup and some of the essential clauses you should look out for are highlighted.

1. 1.    Employment agreement and offer letter

One of the most essential contracts is the captioned i.e, an employment contract. These contracts are important especially since you will likely want to engage staff to help you manage  and service your business day to day operations. Having  watertight  employment contracts is crucial to protect your business and your business’ interests.

The core features of a contract of employment for a new employee include (this list Is not exhaustive)

• The employer’s name and address;
• The employee’s job title and brief job description;
• Place of work;
• Date of agreement;
• Start date and duration;
• Hours of work (such as whether it is full time of part time) and holiday entitlement;
• Termination, notice periods and dispute resolution or grievance procedures;
• Optional benefits, such as sick pay, and;
• Intellectual property (IP), personal data and non-compete clauses.

Whilst you can find free templates online that might serve this purpose they probably will not offer you the flexibility or protection that your business deserves and needs and often times many of these online contract are wholly inadequate.

 2.    Consultancy and Independent contractor agreement

Another essential type of contract is a consultancy, or contractor, agreement. These types of service agreements might be more appropriate for your business model than taking on employees as they are responsible for their own pension and national insurance contributions. A consultancy agreement is used for a variety of reasons, most commonly to appoint a self-employed consultant to provide services.

A consultancy agreement should contain similar basic information as employment agreements, such as: start date, duration of work, termination and notice. Confidentiality clauses and IP clauses are particularly important when taking on consultants, especially if you have hired them to design something for your business. Under a consultancy agreement, a consultant is obligated to provide the services as prescribed in the contract, invoice the client as per the payment terms in the contract and have professional liability insurance among other things you might also wish to specify the nature of the services and any deliverables the consultant is expected to provide within your consultancy agreements for clarity.

3.    Confidentiality Agreements

 A businesses’s intellectual property is one of its most important assets/ Protecting your business’ confidential information is extremely important but you will need to share information about your business to certain individuals in order for your business to grow. Employees  are an obvious example of these sources  and in your employment agreements it is prudent to ensure that you have a clause that relates to the handling, processing and sharing of confidential information both to protect your trade secrets .

It might also make sense for your business to partner with other businesses in order to scale growth quickly. Typically, in order to see whether two businesses are a good match they will need to share information about their user base and strategies. In these situations it is key that you have access  and create non disclosure agreements to ensure that the information you do share remains confidential and, if you decide to officially partner with a partnership agreement, you want to ensure that there are also relevant clauses relating to confidentiality in this new agreement.

 4.    Company Policies

It is prudent that a company has clear policies for any issues that may arise and also to prevent unnecessary legal issues/litigation. For example, you will want to ensure that you provide your employees with a staff handbook to supplement your employment agreement and outline company procedures in the case of illness or grievances, sexual harassment etc

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Conclusion

Having these contracts in place protect your business from its inception. At McFarlane and Partners we have over a decade of experience at the Jamaican Bar and handling legal matters for small and large scale companies/businesses. Call us at 876-388-0935,email:mcfarlaneandassociates@gmail.com