Legal Question in Business Law in California

Re: How to write an employment contract

Just to add a thought - consider that it might not be in your best interests to make this person an employee. Perhaps the better relationship is that of independent contractor.

Even so, you are making an extremely complicated agreement that must take into account not only the law surrounding employment/business relationships, but also intersects with the new law governing the Internet. Plus, when you are giving away ownership in your business, you just don't want to do things "on a handshake" or with an inexpertly drawn contract because the results could be disastrous if something goes wrong.

Take a look at the samples at the end of this email and then reconsider whether you want to draw this up yourself. By the way, the partners at my firm have been practicing employment law since before the invention of the Web. I started writing webmaster agreements in 1998.

http://www.kslaw.com/library/articles.asp?196

http://www.onyxgraphics.com/Main/WebDevCon.html

http://www.affluencywebs.com/agreements/package_agree.htm

Also see http://www.gcwf.com/articles/journal/jil_may98_3.html

Re: How to write an employment contract

I'm sorry to join the chorus, but this is something an attorney should prepare for you, as he or she can build some protections in for you, and not give away too much inadvertantly. They can also discuss with you the best ways to reward employees and go over your options.

Re: How to write an employment contract

you should get an attorney to do it for you for a flat fee, the problem with writing the employment contract yourself is that you may not cover many important issues

you are also going to make the employee a shareholder which opens a new bag of worms

if all goes well you will hardly look at that contract, if things go badly you will wish you had a lawyer look at it

Re: How to write an employment contract

The answer is that you should not attempt to write a contract of this sort yourself.

First, employment contracts are always touchy matters, with great potential for misunderstandings, legal errors, invalid non-compete clauses, and the like.

Also, contracts covering issuance of company stock to employees will invoke the securities laws, whether or not your company is private (or public), and you need to consider repurchase arrnagements if the employee leaves, dies or has to be fired, and on and on.

I recommend you have an attorney draft the documents you need. As a poor alternative, you might find a boilerplate agreement at a law library--that could be a slightly better idea than writing your own, but when you look at the factors the forms book will tell you to consider in customizing the boilerplate, you'll see why you really need a pro to do it.

I have assisted several ex-employees pick apart their former employers' employment and stock-option contracts and I know how an angry ex-employee or ex-wife can go on the attack. Much worse for you in such a case if you wrote the agreements yourself!