In Short
- Core legal documents like NDAs, shareholders agreements, employment/contractor contracts, service agreements, and website policies protect your agency and clients
- NDAs help safeguard sensitive information during pitches and negotiations
- Employment and contractor agreements should clearly define roles, IP ownership, and restraint clauses to avoid disputes
Tips for Businesses
Begin with key legal documents, such as NDAs, shareholders’ agreements, and contracts, to protect your agency. Use clear service agreements for clients and assign intellectual property rights. Keep website policies current. Seek legal advice to tailor documents for your business and ensure compliance with laws.
Starting your own business is an exciting and busy venture. Suppose you are considering starting your digital advertising agency. In that case, you likely already understand the online environment and how quickly your customers expect you to deliver services. Starting with the right suite of documents can mean the difference between protecting your intellectual property, employees, brand and sanity in the flurry of securing the next major contract.
This article outlines several important documents you should make readily available to protect your digital advertising agency. Of course, you may need additional documents depending on the exact nature of your clients and the services you are offering, but having these is a great start.
Confidentiality or Non-Disclosure Agreement
A non-disclosure agreement (NDA) is an agreement between two (or more) parties intending to share confidential information.
It is a pivotal document for commercial discussions with third parties prior to the establishment of any official legal relationship. For example, suppose you are planning an app for a prominent beauty company. During the pitch, both parties may share commercially sensitive information, and neither would want to worry about unwanted disclosure beyond the meeting.
Presenting a mutual NDA, which protects information disclosed by either party, often appeals more to clients. It means both parties agree to keep certain information confidential. Moreover, it fosters trust with your clients, which is vital, especially for startups.
Shareholders Agreement
Suppose you are launching your agency as a company with multiple partners. In that case, it is crucial to establish from the outset:
- each person’s duties in the company;
- roles and responsibilities;
- profit distribution;
- the company dissolution process; and
- contingency plans.
Drafting a shareholders agreement is also a great way to ensure all your partners are on the same page regarding the agency’s operation and avoid any misconceptions before clients start rolling in.
Continue reading this article below the formEmployees and Contractors
When employing staff or engaging contractors to help provide your services, you should have employment or contractor agreements in place for all individuals employed by the business.
Employment agreements define team member roles and address issues such as:
- remuneration and benefits;
- leave entitlements; and
- expectations.
For contractors, you should have separate contractor agreements that outline the key obligations of the contractor and the services you expect them to provide to you. These agreements will also set out how you will pay contractors for work they perform for you, and should clearly set out the key rights and obligations for both parties.
Here are some key elements for you to focus on in these agreements.
Restraint Clauses
These terms dictate whether the contract restrains your employees from working for your clients or competitors after leaving your agency. The two main types of restraint clauses are non-compete clauses and non-solicitation clauses. A non-compete clause prevents an employee from working for a competitor or starting a similar business for a specified period after leaving their job. A non-solicitation clause prohibits a former employee from approaching the company’s clients or other employees to lure them away for business purposes.
Intellectual Property
By law, any work an employee completes belongs to the employer. However, this does not apply to contractors. Therefore, it is important to include this in your agreements with contractors. This will ensure that any work or materials created by contractors in the course of providing services to you remain your property, and you retain important work products for future business use.
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Service Agreement Including a Standard Statement of Work
You will need an agreement outlining the terms and conditions under which you will provide services to your clients. From the outset of your legal relationship with clients, you must document your obligations to the client and the specific work you will complete in the agreement. When you are excited to develop a project for a client, you might scatter important project details across emails instead of clearly setting them out in a contract. This means you should ensure that you specifically state this in your service agreement, which can provide clarity to both parties.
A comprehensive master services agreement should include several key elements to protect both the agency and the client:
- the scope of services provides a description of the types of services your agency offers;
- payment terms need to be clearly outlined, detailing how and when the client will pay for services;
- intellectual property rights must be addressed, specifying who owns the work produced and any associated IP;
- confidentiality clauses are essential to protect both parties’ sensitive information;
- termination clauses should include explaining how either party can end the agreement; and
- liability limitations which protect you and limit your liability under the agreement.
The statement of work, being project-specific, should contain different details. Include a detailed description of the deliverables, clearly stating exactly what you will produce or deliver as part of the project. You can also include a project timeline with key milestones and deadlines, as well as outline each party’s specific responsibilities, including what the agency will do and what the client needs to provide to enable you to deliver your services and meet client expectations.
Website Terms of Use and Privacy Policy
Your website is often your client’s first impression of you. It showcases your work and professional journey. Therefore, the lack of a robust terms of use document and privacy policy could raise questions that impact your clients’ trust.
Your website’s terms of use explain how users can interact with your website, how you manage comments, and how you handle content.
Your privacy policy can also build trust by clearly outlining how you handle personal information. This is particularly important if you collect any data through your website or large amounts of personal information from your clients. Even if you do not collect much personal or sensitive information, a privacy policy shows that you take data protection seriously and are committed to safeguarding client information in an increasingly complex privacy environment.
Additionally, as your business grows, having these documents in place will provide a solid foundation for your online presence and can be updated as needed to reflect changes in business practices or legal requirements.
Key Takeaways
Ultimately, your primary focus should be on building relationships with your customers, creating innovative content and increasing revenue. It is essential to have a set of core documents readily available. Having these ready to use makes the process of pitching and being hired by clients considerably smoother than if you had to pause each time to prepare the necessary documents to safeguard your business.
If you need help with documents for your digital advertising agency, our experienced contract lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 1300 544 755 or visit our membership page.
Frequently Asked Questions
When launching a digital advertising agency, it is critical to have a set of core legal documents. These typically include a confidentiality or non-disclosure agreement (NDA) to protect sensitive information, a shareholders agreement if you are starting with multiple partners, employment or contractor agreements to clearly define roles and responsibilities of all workers, a service agreement outlining the terms of service provision, and website terms of use and privacy policy to guide how visitors interact with your online presence. Each document serves to protect your business and streamline your dealings with clients, employees, and partners.
When engaging in discussions that involve sharing confidential information, it is best practice for you to have a confidentiality or non-disclosure Agreement (NDA) in place. The NDA should be mutual, meaning that any information disclosed by either party is protected. Ideally, this should be established before any sensitive information is exchanged. The NDA should have terms prohibiting the use of any confidential information to compete with your agency, offer any services similar to your agency’s, interfere with any relationships you have with other clients, or poach any of your staff members.
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