Documentation, although often considered boring and mundane, plays a key role in protecting your business’s interests, and can protect the business owner as well. While a single piece of paper might not seem like a significant component to business success, it can provide immense protection should a legal issue raise it’s head down the road.
While helpful in establishing, protecting and maintaining business relationships, and overall business policies and procedures, these documents can also benefit for your business beyond the legal relam. For example, they can serve as an important go-to resource for your employees and associated partners and help build a strong foundation for your business to grow and succeed.
Here are some of the legal documents that are vital to your business. While DIY sites can provide a starting point, an experienced lawyer can ensure that you maximize your protection, and offer additional insight that answering a few questions on-line cannot provide.
1. Employee Performance and Discipline Documentation
As your business grows over time, the number of employees will likely grow along with it. Whether you have five employees or 50 employees, business owners should understand the importance of documenting the administrative aspect of the employer-employee relationship, such as employee performance and discipline.
Documentation that tracks and records employee performance and discipline not only provides a resource in your business to help your employees grow professionally at the same rate as your business, this type of documentation can also help protect your business in the event of issues regarding employees. As a business owner, what would you do if one of your employees started slacking off over time, thereby costing your business financial and reputable harm? Wouldn’t you like to have some sort of document to review, or support, decisions that you made?
In the event that an employee promises to turn things around but fails to see that plan through, the consequences of those actions can be legally enforced, as long as they’re agreed upon and established through the right documentation. Also, proper documentation can help you avoid unnecessary charges to your unemployment account, and support those disciplinary decisions.
No one ever wants to envision that they would have to take legal action against an employee, or vice versa, but these documents can serve as meaningful protections and also save your business time and money in the long-run.
2. Employment Agreements with Workers
A written employment agreement clarifies expectations of both the employer and its employee to help avoid future conflict by addressing important aspects of the employment agreement. An employment agreement typically establishes compensation, benefits, responsibilities, confidentiality and more. This type of documentation not only establishes a formal relationship between the employer and individual it seeks to employee, but it also serves as a resource and reference if a dispute arises over any misunderstanding regarding the employment arrangement. Also, such Agreements can prevent an employee from running off with your customers, or your best workers. Who wouldn’t want to add that layer of protection?
3. Confidentiality Agreements
Ever wondered how the Coca-Cola formula has remained a secret for over a century? Many businesses with secrets to their product or trade enforce confidentiality agreements with their employees and workers.
A confidentiality agreement or clause was designed to keep an employee from disclosing company secrets and information to a competitor or third-party. With younger employees switching jobs more than ever now, a confidentiality agreement is certainly worth considering if you need to keep a lot of your business operations and information under wraps. How you do what you do, and who you provide that service to are just two small examples of the types of information that you can protect with a Confidentiality Agreement.
4. Employee Handbook
An employee handbook isn’t just one document, per se, but a collection of company and workplace policies and information that detail important topics for your employees, and establish the company’s norms. Business owners are required to inform their employees of certain rights and obligations. Establishing and writing them in a handbook that is reviewed and accessible to employees is a common method to ensure your business avoids civil fees and penalties.
An employee handbook should not only cover important topics, but it can serve as a reference for workplace policy, good and bad behaviors, and more. While neither state, nor federal, law establish what an employee handbook must include, best practices would suggest including the following topics:
- Compensation and benefits
- Leave policy
- Standards of conduct (such as computer use, and no toleration for theft)
- Safety and security
- Harassment and anti-discrimination policies
An employee handbook is a critical tool in establishing and enforcing these policies now and in the future. Having these details outlined in an employee handbook also eliminates the possibility of misunderstandings between an employee and employer, thus, limiting liability to lawsuits involving these subjects.
5. Privacy Policy and Terms of Service
A few of the most commonly sought-after legal documents in business are terms of service and privacy policy. Why are these two legal policies so important for businesses? First, employers have a responsibility to safeguard the personal information of both employees and customers. A privacy policy, for example, clearly communicates what information is allowed to be made public and what is required to stay private – such as employee health records, phone numbers, physical addresses or email addresses.
Second, a terms of service policy and a privacy policy protect your business in a number of ways, including limiting or preventing lawsuits from users regarding use of their information, having the ability to take action against a user who misuses your website – whether it is posting something offensive or abusive, or hacking the website.
Being proactive in assessing which documents your business needs to establish is critical for business success. Business owners who recognize the necessity of these documents can save time, money, and headaches in the long-run by avoiding legal mishaps due to a misunderstanding or lack of communication.
Additionally, business owners should understand that having an experienced business lawyer draft these documents can help them avoid the disaster from an improperly crafted document.
Need assistance understanding which documents your business needs to establish or assistance crafting these legal documents for your business? Contact my office today.
