For any business owner, it is imperative that all agreements related to the company are put in writing in order to protect his or her rights and interests. However, business contracts are important for outlining the expectations of the parties on all sides, whether a business, vendor, or employee. In simple terms, a contract is a legal document that governs the relationship between two or more parties. These contracts should be carefully reviewed by all involved parties because it is important to take into consideration what other factors impact this type of relationship, including any relevant laws or statutes.
Types of Business Contracts
Different types of business contracts define terms of an arrangement, which can be between various parties. Business partners may enter into an agreement that defines their roles and responsibilities and the consequences if one partner leaves the company. The nature of that contract depends on whether the business partners are part of a limited liability corporation, partnership, or corporation. Another type of contract is an employee agreement, which outlines the roles and duties of the employment, salary and overtime pay, hours, paid time off (PTO), medical leave, healthcare benefits, as well as non-compete agreements. Additionally, confidentiality clauses restrict employees from taking trade secrets and going to work for a competitor. Another type of business contract is a vendor agreement, where business owners hire third-party vendors. Vendor agreements typically outline the duties they are performing, prices, intellectual property, confidentiality, non-compete terms, and dispute resolution.
Know What You Are Signing
Regardless if you are the owner of a company or one of its employees, you should understand what can and cannot be included in any contract that you are asked to sign. Certain terms of a contract may not be enforceable by a court of law, even if two parties agree to those terms. It is important to note, however, that one party may still be liable for specific issues if these aspects of the relationship cannot be governed by a contract. There is a lot of outside research that goes beyond simply reading what is put on paper. That is why it is essential that you hire an experienced business attorney or contract lawyer who can assist you with the review and negotiation process before signing on the dotted line.
Below are several crucial actions that you can take to protect yourself in the event a business contract cannot help you achieve your goals:
- Review the existing terms: People sign documents all the time without actually reading through them. However, that can get you into trouble down the road because this will not be a defense in court. Thoroughly look over the terms listed in the contract, which means reading the fine print and comprehending their meaning and how it applies to you.
- Change or remove terms that should not be there or are not enforceable: An example of an illegal or unenforceable term would be if the employer and employee agree to the employee receiving less than minimum wage for work performed.
- Conduct research to add terms that should be included: A knowledgeable business attorney can help you find any important information that might be missing from your contract. You can then make sure to include it in the final contract before signing it.
- Consider common scenarios of dispute: An experienced business attorney knows the most common areas of dispute. You should be extra careful in being clear about terms regarding compensation, services, or products included, and what the parties’ rights are in the event of a business divorce or dispute.
Contact a Villa Park Business Law Attorney
Laws that regulate businesses are put in place to protect owners and employees alike. Contracts are essential legal documents that explain the terms of any business relationship, whether it is between the employer and employee or the owner and a client or a third-party vendor. A skilled and committed DuPage County business lawyer at Shakfeh Law LLC can help you review the terms of your contract to make sure your livelihood is protected. With more than 10 years of experience working in the legal field, Attorney Danya Shakfeh is well-versed in Illinois business law. Call us today at 630-517-5529 to arrange for your consultation.