10 Legal Documents Every Business Needs
When you’re starting up a business, it’s imperative for you to ensure that all of your legal requirements are covered. Here are some of the legal documents that your small business might need:
A partnership is essential for a small business, especially if the business is to be run smoothly. Why? It’s because the partnership agreement specifies exactly what is expected from each partner and how the business is supposed to be run under the partnership. This ensures that there no significant conflicts during the course of business; which can be gold dust for the growth of the business.
Articles of Incorporation
The Articles of Incorporation is a legal statement that contains the names of the founders of the business and their intention to incorporate it. It also outlines the rules and regulations that the company must adhere to. So, if you’re willing to incorporate your business, you will need to ensure that you’ve got the Articles of Incorporation in order.
Employment contracts are a legal necessity, no doubt, but that doesn’t mean that they don’t have any other utility to offer. For instance, employee contracts can be a great way for the employees to know exactly what it is that the employer is expecting from them. This can do wonders for the employee-employer relationship and ensure that both of the parties are on the same page. Some of the key areas that employee contracts should cover are: pay, benefits, holidays, sickness, termination etc.
It’s essential for every business to protect its ideas and intellectual property. This is the reason why it’s of utmost importance for businesses to have a confidentiality agreement in place. A confidentiality agreement is a non-disclosure agreement that ensures that the confidential information pertaining to your business is not made public or exploited, as you can take legal action to claim damages if such information is leaked in any possible manner.
Health and Safety Policy
It’s your responsibility—as the employer—to ensure the health and wellbeing of your employees. This is the reason why your small business needs to have a written health and safety policy in place. This will not only give your employees the assurance that they’re working in a safe environment, where they are protected from injury and liability, but also ensure that you’re seen as a responsible employer.
A Shareholder Agreement is a document that governs the relationship between the founders and the shareholders of a business. It not only outlines the investment, ownership and equity among the shareholders but also advises on matters such as transfer of shares, exit strategies and shareholder disputes.
The company bylaws specify how the company will govern itself. From matters regarding shareholder disputes to the entire voting procedure—these company bylaws have got it all. To put it more clearly, company bylaws are the managerial and administrative rules that guide the operations of the company.
A business might even be required to keep a track of the minutes of meetings. The meeting minutes are a formal account of everything that was discussed in the meeting, including any business decisions that might have been taken towards the end of it. A formal record of meeting minutes ensures that there’s no dispute regarding the happenings of the meetings afterwards.
Memorandum of Understanding
A Memorandum of Understanding (MOU) is another important document that a business needs to be in the habit of utilizing. An MOU is a kind of a handshake that documents any important conversations which you might have had with your suppliers, customers and potential partners. The biggest utility that MOUs offer is that they put everything that’s decided on paper so that it can serve as a basis for a strong, fruitful relationship for both of the parties. The document, however, is not legally binding!
So, these are some of the legal documents that are imperative for a business to have. Be advised, however, that this list is non-exhaustive and that there might be some other legal and non-legal documents which your business might need!