Legal documents

Legal documents aren’t very sexy, but they’re extremely important

There are a million and one things you will be thinking about when starting your business and, for many entrepreneurs, legal documents may not be the top priority. However, getting this step right is crucial to ensuring that your business is adequately protected and has the best possible chance of success.

This blog will outline the legal documents you may need to put in place as a start-up business owner to enable you to sleep safe in the knowledge that you’re doing things the right way and to kickstart the future success of your business.


1. Standard terms and conditions

Depending on the type of business you are running, you will usually need a standard set of T&Cs for both your customers and suppliers. T&Cs are a legally binding contract which outline the rights and responsibilities of both you and the company or individual you are entering into them with.

Customer T&Cs allow you (amongst other things) to set out how and where your goods or services are to be delivered on a standard basis, how they are to be paid for and to limit your liability should a complaint arise, and many insurance companies require professionally drafted T&Cs for any insurance to be valid.

Supplier T&Cs similarly allow you to set out the scope of what is being provided. Importantly, they will outline your rights and responsibilities, as well as those of the supplier. It is important when dealing with supplier T&Cs that you have regard to risk and that this risk is linked to the liability you want to take on, and the liability you want the supplier to have. For example, your position with regard to liability may be very different when dealing with a stationary supplier, as opposed to the company providing the platform in which your entire customer database is held!


2. Employment contracts

If you’re employing even one person, it is vital that you put in place an employment contract. An employment contract is a legally binding agreement designed to give both parties security and protection. It sets out the employee’s employment conditions, rights, responsibilities and duties – providing guidelines and expectations to be met. There are many provisions in an employment contract that can protect your business’ interests, such as preventing employees from moving to your main competitor, poaching your other employees and/or running away with valuable trade secrets.


3. Consultancy Agreements

In today’s world, flexible working arrangements are becoming widespread and many entrepreneurs favour consultancy arrangements rather than engaging employees. Consultancy agreements are just as important as employment contracts because for one, they define the business relationship. A consultant is not an agent or an employee of the business and so they don’t operate in the same way. It is important that expectations and responsibilities are agreed in writing as well as the scope of the work, payment terms, duration and that any confidentiality issues are captured.


4. Non-disclosure agreement (NDA)

Information is power and can be one of your business’ biggest assets. Information that falls into the wrong hands can be extremely detrimental and so it’s no surprise that people often go to great lengths to protect it. An NDA is a legal agreement requiring the person you enter into it with to keep quiet about certain information. NDAs are common in the world of business and are often used to protect intellectual property and other trade secrets. The NDA will enable you to seek damages where the terms of the Agreement are breached and so can be great incentive on people not to run their mouth!


5. Privacy Policy

If you process personal data, it is a legal requirement to have a privacy policy. This will sit on your website and provide information relating to who you are, what personal data you process, why you process the data, how long you process it for and who you share it with, as well as offering information on the rights that individuals have in relation to that data. Drafting this document as early as possible will prevent an angry knock at the door from the Information Commissioners Office (and if you’re unlucky, a hefty fine)!


6. Website Terms of Use

Website terms of use also sit on your website. They are distinct from the T&Cs outlined above, as they are only concerned with the way the website is used. They typically detail the permitted uses of the website content, registration requirements, website availability and any requirements around user generated content and fees. It is a legal requirement to provide information about your company details on your website and website terms of use are the perfect place to include this information.

Your business is your baby and you want to ensure that it is well protected and has every chance of succeeding. Hopefully this blog has made you think about the essential legal documents you need in place to make this happen!


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