Good contracts are cheap insurance. For a new business in England and Wales, putting the right agreements in place early prevents the disputes, lost intellectual property and tax headaches that sink young companies. Here are ten contracts most startups and small businesses should have, with a plain-English note on why each matters.
1. Shareholders' Agreement
If your company has more than one shareholder, this sets the rules between them, how decisions are made, what happens if someone wants to leave or sell, and how disputes are resolved. It sits alongside your company's articles of association (the constitution every company has under the Companies Act 2006) and fills the gaps the articles leave open.
2. Founders' Agreement
Before or just after incorporation, founders should record who owns what, who does what, and what happens if a founder leaves. "Vesting" (earning shares over time) and assigning each founder's intellectual property to the company are the two clauses people most regret leaving out.
3. Employment Contracts
By law, employees and workers must be given a written statement of their main terms, and since April 2020 this is a "day-one" right under the Employment Rights Act 1996. A proper contract also covers confidentiality, notice and (where justified) post-termination restrictions.
4. Consultancy / Contractor Agreements
When you use freelancers, a written agreement should make clear they are self-employed and (crucially) that any work they create belongs to your business. Without an express assignment, a contractor often keeps the intellectual property in what they make.
5. Non-Disclosure Agreement (NDA)
Before sharing sensitive information with investors, suppliers or potential partners, an NDA creates a clear, enforceable duty of confidentiality. It is most useful as a deterrent and as evidence of what was meant to stay secret.
6. Terms and Conditions of Business
Your standard terms govern how you sell to customers, payment, delivery, liability and what happens when things go wrong. If you sell to consumers, they must comply with the Consumer Rights Act 2015; business-to-business terms have more freedom but still face controls on unfair exclusion clauses.
7. Website Terms and Privacy Policy
If your site collects personal data, a privacy policy is a legal requirement under the UK GDPR and the Data Protection Act 2018, and website terms set the rules for using your site.
8. Supplier and Service Agreements
Securing your supply chain in writing protects delivery times, quality and price. Where you buy in services, the Supply of Goods and Services Act 1982 implies a term that they be carried out with reasonable care and skill, but a written agreement lets you go further.
9. Intellectual Property Assignment or Licence
Your brand, code, designs and content are often a startup's most valuable assets. Make sure the business actually owns or is licensed to use them, especially anything created by contractors, who otherwise retain ownership.
10. Partnership Agreement
If you run a traditional partnership rather than a company, a partnership agreement covers profit shares, decision-making and exit. Without one, the Partnership Act 1890 fills the gap with default rules that are rarely what modern partners want, including that the partnership can dissolve when one partner leaves.
Key takeaways
- Put the shareholders'/founders' arrangements and IP assignments in place first, they are the hardest to fix later.
- Anyone you pay to create work (employees and contractors) should be under a contract that assigns IP to the business.
- Customer-facing terms must respect consumer law; data collection must respect data protection law.
- A template is a starting point, tailor each contract to your business and have it reviewed.
Sources
- Companies Act 2006 (articles of association; company contracts)
- Employment Rights Act 1996, section 1 (written statement of particulars)
- Consumer Rights Act 2015; Unfair Contract Terms Act 1977
- UK GDPR and Data Protection Act 2018
- Supply of Goods and Services Act 1982
- Partnership Act 1890
--- This article is general information about the law of England & Wales as at 2026, not legal advice. For advice on your circumstances, consult a qualified solicitor.