The Basic Legal Documents Every Online Business Needs
/***This article was created for education/informational purposes and should not be considered legal advice. For specific legal questions concerning yourself or your business you should contact an attorney.
If you think that your business needs one or more of these documents visit www.DigiMarketingLaw.com for affordable legal solutions.
1. Terms of Use/Privacy Policy – While technically these two documents are separate, they really do go hand in hand. The Terms of Use will spell out to visitors to your website the rules they are expected to abide by, and what they can expect of you in return. A Privacy Policy lets site visitors know exactly how you will be collecting, using, disclosing, and managing the information they submit. Many business simply copy and paste these documents from other similar websites, but this is a very dangerous practice, and not only because you have no idea how the business you copied got those documents in the first place. No two businesses are exactly the same, so there are bound to be some inconsistencies between what is in the documents you copied, and what you’re actually doing. And… if a consumer ever makes a complaint against your website/business and you aren’t following your Terms of Use and Privacy Policy 100%, you could find yourself with a hefty amount of legal trouble.
2. Proper Disclaimers - If you have any kind of sales pages or sales materials on your website then it is essential that you use proper disclaimers in your advertising. The Federal Trade Commission (FTC) is the government agency that looks out for false or misleading advertising, and using proper disclaimers is one of the best and easiest ways to keep them off your back. The types of disclaimers you need depend entire on the type of products/services you offer, the industry you are in, and what is said in your advertisement itself. Penalties for failing to use proper disclaimers start at a minimum of a hefty fine, and in some cases could result in your business being shut down.
3. Independent Contractor Agreements – As an online business, chances are you aren’t hiring too many full-time employees. When a task comes up that you can’t perform yourself, you’ll probably look to hire someone to perform that task, and nothing else. In a perfect world, we’d love to have simply handshake agreements and not have to worry about it. Unfortunately, we don’t live in a perfect world, and we need to protect ourselves and our businesses. A good independent contractor agreement spells out exactly what service is being performed, how long it is supposed to take, and the pricing. Also, if someone is creating something for your business you will want to make sure that you retain all intellectual property rights. The default rule is that if some makes something for you, they get to keep the rights. It’s up to you to make sure the agreements states that your business is the one who keeps the rights instead.
4. Non-Disclosure Agreements – To grow our businesses, we often talking to others about potential opportunities. Sometimes these talks resulting is something significant, sometimes they don’t. Almost all the time these discussions involving talking about information that is very important to your business, and would be harmful if your competitors found out. When entering these kinds of talks it becomes very important that each party signs a non-disclosure agreement. This agreement will ban someone from discussing your private business information from anyone else, and if they break the agreement they will be subject to substantial penalties.
5. Customer Agreements - No matter what you’re selling, and especially if you’re selling online, you will need to have an agreement between yourself and the customer. The agreement will set forth exactly what services you are providing, and will spell out the rights of you and your customer. With such an agreement, an unhappy customer is free to make any claims and drag you through the mud. No matter what you’re doing, all sales should be in writing. This applies to everything, including coaching, consulting, advising, information products, physical products, SaaS, software products and freelancers.
6. Affiliate Agreement – Selling through affiliates is one of the most popular methods of getting your product in front of as many potential customers as possible. Far less popular are adequate affiliate agreements. A good affiliate agreement will make it clear to each party what they are putting in and what they can expect to get out. If there is a disagreement then the answer will in the agreement itself, saving everyone time and money. A well written agreement will also help avoid lawsuits from those particularly unscrupulous people.
***Note: One of the biggest complaints I hear from people is that they recently performed work for someone, but haven’t been paid, and the person or business who owes them money is nowhere to be found. This is such a common problem and it can be easily solved by a well drafted contract. When the terms of a contract are clear, and one party violates those terms, then having that issue remedied becomes easy. There is no need for a long and costly lawsuit, instead you can get a simple order from a judge instructing them to pay. Any business that ignores an order like that from a judge probably won’t be in business much longer.