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6 Legal Documents Every Employer Should Have on File

When you hire an employee, you commit to following all state and federal employment laws. This includes having the right kind of insurance, such as workers’ compensation insurance, and making sure that you follow wage and hour requirements. Hiring your first employee can be overwhelming, but understanding all applicable employment laws is a great place to start.

There are paperwork requirements for virtually all employment regulations. Therefore, you should have specific documents on file when you hire new employees. Every business is different, but every employer should consider these six legal documents.


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1. Employment Application

An Employment Application tells you a lot about your applicant. Even if you don’t ultimately hire an applicant after they have filled out the application, it’s still good practice to keep them on file in case you need to contact them again. The application provides vital background information on the employee that you hire, including their employment history and relevant skills. It is also the first piece of every employee’s file that you should keep.

2. Employment Contract

The vast majority of employees across the United States do not have an Employment Contract. However, where there is a contract, it is a good idea to keep a signed copy in your employee’s file. You may need to reference it at various points in their employment.

As time goes on, it may be a good idea to revisit the Employment Contract. You may need to make changes or updates to the contract so that it accurately reflects the current state of the employment relationship. Changes can be discussed with the employee and the new, amended agreement signed and filed away.

3. Independent Contractor Agreement

Independent contractors are not considered employees in legal terms and don’t enjoy the same protections as employees. However, if you have properly classified workers in this way, it is a very good idea to have an Independent Contractor Agreement outlining the relationship. As with an Employment Contract, you might want to keep a signed copy of this document in the same folder as other documents that you keep relating to this individual.

4. Employee Handbook

Many employers, particularly small businesses and those just starting up, make the mistake of failing to create an Employee Handbook. This document is important for detailing your company’s policies and procedures, but it is not required by law. An Employee Handbook will inform your employees of your policies, including their rights in the workplace, and can help prevent disputes and other problems down the road.

5. Non-Disclosure Agreement

If your employee is going to have access to private client information or business practices that you do not want shared with your competitors, then you’ll want to use a Non-Disclosure Agreement. This type of agreement requires the employee to keep private information private, detailing how certain types of information should be handled. It also outlines the possible consequences should any confidential information be shared improperly.

6. Federal and State ID and Tax Forms

In addition to these business-specific forms, you may also have your new employees complete certain Government Forms. Specifically, they may need to fill out information for tax withholding and to prove their authorization to work in the United States. 

Form W-4 designates how the employee wants to be treated for income tax purposes so that you withhold the right amount of taxes as an employer. Form I-9 sets out the information that the employee provided to you so that you can confirm that he or she has the right to work in the United States.

Get started on your business-specific forms and contracts by visiting our Employment and HR Contracts and Documents page. We can help you create great forms that you can use to hire your first employees. You can also ask a lawyer if you have a legal question about your employment contracts or documents.

This article contains general legal information and does not contain legal advice. Rocket Lawyer is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.

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