Equity refers to the ownership of a company, typically in the form of stock or the right to acquire stock. While you can’t pay employees solely with equity, startups commonly use equity to incentivize their employees and attract talent.
When hiring employees, a company should ensure it is complying with applicable federal, state, and local laws regarding employee minimum wages, withholdings, and other applicable requirements. To ensure compliance, employers must first determine whether an employee is “exempt” or “nonexempt.” Nonexempt employees are entitled, among other things, […]
Summer is often the season when employers consider hiring interns, but there is never a wrong time to brush up on the wage-and-hour laws surrounding paid and unpaid interns. Startup companies may view an internship program as an opportunity to hire students and develop unpaid internship programs. […]
Now that you’re a VC-backed company, chances are you’re about to go hire a bunch of employees with those funds. Your investors are looking to you and your board to comply with the law and protect their investment from employee-related risks. There are numerous federal and state […]
Businesses face several considerations when onboarding founders or employees who reside in foreign countries. These issues also apply to U.S.-based founders and employees who move to a foreign jurisdiction and work remotely.
For entrepreneurs operating in innovation-driven marketplaces, protection of intellectual property is of foremost concern. Accordingly, startups should require each employee and independent contractor they engage to enter into a Proprietary Information and Inventions Agreement. While agreements of this nature go by several different names (e.g., Confidential Information […]
The right employees help your startup rise to the top. Identifying those employees early can save time and money. The infographic below created by FocusHR points out some of the innovative strategies companies like Zappos and Google employ to find dedicated employees and create a collaborative work environment.
Founders should make sure that their companies’ agreements assign intellectual property presently. In other words, an agreement should provide that the assigning party (the “assignor”) “hereby assigns” to the company the intellectual property in question.
If there is a ground zero of potential liability, this is it. Cash-strapped federal regulators and states are focusing on misclassification cases with renewed zeal and enthusiasm. And companies, even with the best of intentions, often mischaracterize employees as independent contractors (consultants or advisers). Independent contractors are not subject to wage and hour laws, meaning they don’t need to be paid minimum wage or overtime, are not subject to payroll taxes, and are not entitled to meal and rest periods. Some companies use the “try and buy” approach of hiring a “contractor” for a few months before “converting” him or her to a full-time employee. But companies and contractors are not free to decide what type of relationship they are creating. Federal and state laws alone dictate what constitutes an employee versus an independent contractor relationship.
For a start-up company, noncompetition agreements typically arise in one of the following contexts; a founder or new employee entered into a confidential information and inventions assignment agreement (or similar agreement) with his or her former employer that prohibits competing with the former employer, the start-up company wants to prohibit a terminated employee from competing with the company, or in an acquisition, the buyer demands a founder and/or key employee sign a noncompetition agreement.
