Managing your human resources is perhaps the hardest part of a growing business. When you only had a handful of employees, it was easy to meet with each of them face to face to discuss performance and expectations. Handshake agreements and verbal commitments were the norm for all but the most complicated of arrangements between you and your staff, and a business lawyer was a mere afterthought.
Once you expand beyond a handful, the situation becomes trickier. Different departments have different salary structures and expectations. Managers or department heads perform most of the hiring for your business, and you spend face to face time with only a fraction of your staff. At this moment, your company is at a tipping point, where a business lawyer and employee agreements become essential.
As a business owner, there are four agreements of particular importance.
How many times have you heard one of your employees say “That’s not my job”? It’s a common refrain for a reason: employees don’t want to be overburdened by tasks outside of their job description, especially if failing that task could mean trouble for their career.
When your staff grows large enough, employees develop specialized roles that require clear definition. With a business lawyer you can lay out the expectations for each employee in every position in your company, and use the written expectations as legal grounds for firing, raises and promotions.
More and more employers are turning to arbitration agreements to defend themselves against lawsuits from disgruntled employees. A legally binding arbitration agreement can require employees to give up their right to sue for any number of grievances, ranging from wrongful termination to discrimination.
You need the help of a business lawyer to create an arbitration agreement that will hold up in court. Mandatory arbitration agreements as a condition of employment are legally binding, but they must be balanced in their treatment of employer/employee rights. A poorly developed arbitration agreement may fail the unconscionability test, and become void.
In today’s business world, employees change employers several times throughout their lifetime. The rate of turnover can become problematic for your company, if the employee leaves to take a position with a competitor or someone in a similar industry.
Non-compete and non-solicitation agreements protect your business after an employee leaves. The non-compete agreement prevents employees from joining another company in the same industry, while the non-solicitation agreement stops former employees from poaching your clients when the employee takes another job.
These agreements are delicate legal documents, subject to intense scrutiny when challenged. A judge may void either agreement if the agreement does not contain specific language about the duration of the non-compete, geographic considerations, or a definition of competing activities. Your business lawyer is an essential ally to draft an ironclad set of agreements.
In the early days of your business, a simple set of documents covering these topics is enough to meet your needs, but as your company grows, you’ll need more detailed and specific language. Douglas Park Law can assist you with your business law needs, including the development of employee handbooks and company policies that protect you and your company from litigation in the future. Contact Douglas Park Law today to discuss your needs.