How to grow your Business

5 Essential contracts for small businesses

Charles BrecqueCharles Brecque
Last updated on:
July 29, 2022
Published on:
November 9, 2021

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Small businesses need to create and manage legal contracts but don't always have the resources to retain a legal team to support their contracting efforts. Not having access to up-to-date templates for a wide coverage of types of contracts can hamper your business development initiatives which are essential for the success of small businesses. Not protecting your intellectual property sufficiently in your contracts when hiring employees, freelancers or consultants can put your longer term business plans at risk. Small disadvantaged businesses don't need to bear unnecessary legal risk or miss out on business opportunities because of a lack of legal support now thanks to Legislate. This article is an essential read for all entrepreneurs as it will explain the essential contracts you need for your small business and how you can create them with Legislate.

Why do small business owners need robust legal documents?

Small businesses should use the correct legal documents ranging from employment contracts to confidentiality agreements in order to protect their business. Legal risk can creep into poorly written contracts which can negatively affect a small business' legal obligations. Moreover, the key terms of contracts should be tracked digitally so that small businesses can manage contracts and keep track of renewals and end-dates.

Create a non-disclosure agreement to protect your confidential information

B2B small businesses often help larger organisations solve specific problems which would be too costly to fix themselves. Ahead of a business contract, the client and solution provider will need to exchange information with each other in order to determine if they can work together. The information which needs to be exchanged to determine the fit is often confidential. In order to protect the confidential information and prevent the other party from using it or disclosing it, parties should enter into a non-disclosure agreement (NDA). Small businesses can create robust non-disclosure agreements using Legislate. To start, the small business will need to define the purpose for the disclosure of confidential information. This can be for example a potential commercial partnership. The next step is to define the term of the agreement which is how long the information needs to be kept secret by the recipient. Finally, if both sides will be disclosing confidential information, the coverage of the NDA should be set to mutual, alternatively the NDA should be one-way. Finally, after reviewing the contract terms, invite the other party via email. The following video demonstrates how to create a NDA with Legislate. Alternatively, read our NDA tutorial.

Create a consultancy services agreement to hire consultants

Small business owners and startups often choose consultants and freelancers to work on  projects as it can be more cost-effective than hiring full-time employees for skills which might only be required momentarily. A consultancy services agreement allows a client to hire a consultant for a fixed term or rolling project during which the consultant will be paid to provide services or a deliverable in exchange for consultancy fees. To create a consultancy agreement with Legislate, simply specify the nature of the services and how the consultant will be paid. Read our consultancy agreement tutorial to see how to set the key contract terms now.

Create an employment offer letter to hire employees

When a small business has decided they would like to hire a new employee, they can use an employment offer letter as way of summarising the key terms of employment before entering into the formal employment agreement. An offer letter will specify the prospective employee's job title, line manager, salary and other key contract terms such as holiday, work location and benefits. Setting the key contract terms of an offer letter with Legislate involves completing a simple questionnaire.

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Create an employment contract to onboard employees

A small business will need to create a formal employment contract if ever their offer of employment is accepted. An employment agreement needs to include key clauses such as confidentiality, intellectual property and restrictions in order to protect the employer. Employers in England and Wales also have responsibilities towards their employees which need to be clearly spelled out in the employment contract. Legislate's employment agreement can be tailored to a wide variety of employment situations ranging from part-time to full-time, fixed-term of indefinite. Legislate's employment contract can also include special contract terms such as a probationary period, paid over time and benefits.

You can also read our tips for hiring a team quickly and what to look out for in a recruitment agency agreement.

Create a staff handbook to easily share your company policies with employees

After hiring employees, it is essential to onboard them to your company policies and culture. A staff handbook is a document which contains a company's rules and policies ranging from holiday, health and safety, and equal opportunities policies. Staff handbooks are often overlooked by entrepreneurs as they are not compulsory or deemed to be essential. However, presenting a staff handbook to employees gives a sense of professionalism and is useful for sharing the company's rules which are too practical or specific to be included in the employment contract. SMEs will also need to demonstrate that they have a number of policies in place during procurement processes when competing for government contracts or contract opportunities with large organisations. As a small firm, you can create a staff handbook with a complete set of policies effortlessly using Legislate. Moreover, your employees will be able to access their staff handbook from the same portal as their employment offer letter, employment contract and any other document you have created with them. Read our staff handbook tutorial to create one today.

About Legislate

Legislate is a legal technology startup which allows large landlords, letting agents and small businesses to easily create, sign and manage legal documents that are prudent and fair. Legislate's platform is built on its patented knowledge graph which streamlines the contracting process and aggregates contract statistics to quickly unlock valuable insights. Legislate's team marries technical and legal expertise to create a painless, smart contracting experience for its users.

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