4 Legal Documents Your Online Business Needs

Many people think only large companies with multiple departments and billions of dollars need lawyers and legal assistance, but this couldn’t be further from the truth. Running a small business doesn’t mean you can run it without the right paperwork. In fact, as a small business owner you need a lot more protection. A big company has insurance and a lot of money to survive a challenging time. As a small business, if things go wrong, it not only risk your business, it can risk your livelihood, your assets and your family. So it’s very important that you pay attention to the legal needs of your business.

This is especially true in the world of online businesses. As much as you might not see your customers face to face, and even if you have virtual employees, not having the relevant legal documents laid out could get you in trouble. It’s something you should consider doing right now. The more you can work in advance on these things the better, many business owners have found themselves in trouble because they dragged their feet. According to online business consultant, Autumn Boyd, “An ounce of prevention on the front end will save you so much in time, trouble, headaches, and money when it really matters.”

There’s a whole list of legal documents that you could have in your business, but which ones are most important to have as soon as possible? Here are 4 you need to get sorted right away.

Non-Disclosure Agreement

A lot of people are so trusting of the people they employ, they don’t think that person might end up sharing company secrets, important documents and systems with other people. Don’t underestimate how vindictive someone can be if a working relationship doesn’t end well. When you start working with someone, have them sign a non-disclosure so you have that taken care of. If they do end up breaking disclosure, you have legal cause to go after them.


In a small business, hiring people doesn’t often come with a long induction process and contracts, but you would be making a huge mistake if you didn’t consider it. You might not need a long induction process, but contracts are necessary. In it you can lay out the scope of the work, what they get paid, what happens if you decide to part ways.

Another important factor to include in the contract is what happens for maternity leave and when an employee gets injured on the job. According to this workers compensation lawyer, “No business is too small for contracts and other legal documents. They can be the difference between dealing with a small legal matter and facing the risk of losing your business.” Contracts don’t just protect you, they protect the employee as well.

Privacy Policy

Having an online business means you probably correct people’s email addresses and other personal information. This isn’t something you can just do without actually letting them know. You have to have a privacy policy, letting people know the information you collect, how you collect it and what’s done with it. Luckily, this is an agreement you can find a template for easily online and add your information to it, and you’re good to go.

Intellectual Property

Whether you sell digital products you write on your own, or you have a specific system and method you use to help your clients, this is your intellectual property and it needs to be protected. Imagine if someone started claiming your products as their own and copying what you do. If you protect that information, you can get them to cease and desist and you’ll have legal right.

Legal matters are important because they take the emotion out of things, which is very important in a business. Things don’t always go as planned, and having certain stipulations laid out saves the parties involved from miscommunications and misunderstandings. As an online business owner, you musn’t assume that you don’t need things things done for you. They are vital to the survival of your business. The faster you get these things done the better. The speed isn’t just for convenience, it’s also because in many parts of the world having a document set up first actually helps you win cases.

In the case of documents like a privacy policy, online business owners need them because the government can choose to make an example of you, just by not having these things in order. Spare yourself the headache, and possible irreparable damage to your business by getting this sorted out. 

Author: Richard

Richard is a full time professional, husband, father and blogger juggling all the responsibilities of life and running a blog. Richard enjoys writing about life and online money matters.

Article written by

Richard is a full time professional, husband, father and blogger juggling all the responsibilities of life and running a blog. Richard enjoys writing about life and online money matters.

One Response

  1. such a relevant post. as small business owners we often ‘make do’ with templated legal contracts as fees to write ‘proper’ contracts are money taken straight off the bottom line (usually our personal pay packet). This article highlights a lot of the risks of not having contracts in place which is a great place to start. so many business owners don’t even understand what risks they are bearing! What I then like to do is prioritise spending the time and money writing ‘proper’ contracts for the most important risks in the business (eg protection of IP and confidentiality are crucial for our business).

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