There are certain key documents every business owner should have to protect themselves and their business. The 3 most important types are listed here. If you don’t have these, stop what you are doing and get them done today!
1. Company Bylaws for Corporations or Operating Agreements for LLCs. Your bylaws and/or operating agreement define how your company will run, including your structure, roles, finances, and voting rights. If you don’t have your own you’re the state of Texas will apply the state’s rules to your business, and yes that is about as horrible as it sounds. Most importantly, bylaws/operating agreements help settle disputes between people inside the business and help strengthen your company against lawsuits from those outside your business.
2. Meeting Minutes. This one gives our business owners the most pause, especially when the business is solely owned by them. Every business should track the major decisions it makes in the form of written minutes or written consents. Like your bylaws or operating agreement minutes are key to solving internal disputes and will be one of the first record requests in an external suit. Minutes prove on a decision-by-decision basis that you are operating legitimately.
3. Employment Agreements/Policies. Employees are the so often the greatest asset for a company. For that reason, it can be especially disturbing when something about the employment relationship lands you in legal hot water. This goal of the employee agreement and policies are to set the “obligations and expectations of the company and employee in order to minimize future disputes.” So often putting in place these documents can be the difference in winning or losing a lawsuit.
Some other documents you might consider depending on your business’ needs:
· Non-disclosure agreement
· Business plan
· Marketing Plan
· Memorandum of understanding