When conducting business, various types of contracts are usually received from suppliers or partners for review, negotiation, and signing, which can also serve as agreements for managing relationships with clients or customers. In certain industries, the structure of contracts differs from the way employees are selected for compatibility. Depending on the type of goods and services, some arrangements may be very simple, while others may be quite complex.
Here are some important categories of business contracts:
Lease agreement
1: A lease agreement is one of the types of contracts that businesses usually sign. A lease agreement is a contract signed by the landlord, usually favorable to the landlord.
2: For example, whether the use of the area is sufficient to cover the nature of your business, whether you can sublease or assign the lease, whether you have the right to extend the lease term, and whether the lease agreement clearly stipulates the landlord's obligations.
Employment Agreement
1: If you are hiring employees, the employment agreement covers aspects such as their wages and benefits from the company, weekly working hours, reasons for terminating employees, and how employees can resign, among other things.
2:
The employment agreement also includes a clause stating that all work products developed by the employee belong to the company, and the employee must keep confidential any proprietary company information they have access to.
Non-disclosure agreement (NDA)
1:
If you plan to engage in strategic cooperation or allow third parties to invest in your business, you may want to share information with interested parties. Therefore, you need a type of contract that can protect important information.
2:
For example, a non-disclosure agreement can protect your confidential information. If the other party discloses the confidential information covered by the agreement, you have the right to take legal action. You can sign a confidentiality agreement with your employees, suppliers, partners, or customers.
Sales contract
1:
If your business sells products (goods or equipment), you must have a sales contract.The contract stipulates the price, quantity, terms, and conditions of the product sale.
2:
Among other things, the terms and conditions include the products you are selling, prices, payment and credit terms, taxes, disclaimers, and liability limitations.
Service contract
1:
If you provide professional services, you need to prepare a service contract (sometimes also referred to as a consulting agreement or professional services agreement).
2:
The service contract includes the scope of services, service fees, and service duration, among other details.If the scope of services is expanded, different amounts of fees and other service terms and conditions will need to be paid.
In all types of business transactions, it is necessary to draft different types of contracts. The general rule is that if your business transaction is not in written form, it is usually difficult to enforce legally.
Five Common Types of Contracts in Malaysia