Federal law generally requires employees to receive at least the federal minimum wage, and some states (including California) and municipalities have introduced their own higher minimum wage standards. The minimum wage is a cash standard, so companies cannot use shares or options to meet this requirement. This means that startup employees can`t legally pay only in equity compensation, although many startups still do. When start-ups hire staff, they usually have employees sign letters of offer. When startups hire consultants, they usually enter into consulting contracts (or independent subcontracting agreements) with the consultants. It is essential that each advisor signs an agreement confirming that he protects all confidential information he receives in the course of his mission, both during and after the order, and that all work and inventions carried out during the work for the company in the course of the company`s activities, belong to the company and not to the contractor. It`s almost always invenient for startups to legally have unpaid interns. Under the Fair Labor Standards Act, interpreted by the courts, unpaid interns are only allowed if the employer “does not mention any direct benefit of the intern`s activities. 1 This form is designed to be used for any adviser to the company, including individuals and companies that provide services to the company as independent contractors instead of employees. The distinction between independent contractors and staff is complex and requires advice through advice. Be sure to discuss this form with your lawyer before using it. It is usually appropriate for the company to produce the first draft. more consulting contracts for verification by the lawyer.

Attached Appendix D here: Confidential Information and Invention Agreement for Consultants This document is part of the Orrick Emerging Companies Group`s start-up Forms Library, which can be found under www.orrick.com/practices/corporate/emerg. By using/viewing this document, you agree to the Start-Up Forms Library Terms of Use, which can be found in the following Http://www.orrick.com/practices/corporate/emerg. Startups should also enter into agreements, for both employees and consultants, to ensure (1) that the worker is bound to confidentiality and (2) that the company owns the intellectual property that the worker creates. Typically, these agreements are called confidential information and invention agreements (CIIA Agreements) or invention assignment agreements (PIIA Agreements). Consultants are a kind of consultant. Startups usually enter into a consulting contract with them covering much the same topics as a consulting contract and a CIIA contract. Note that, in most cases, the classification does not depend on the term or documents used by the startup. A government agency can classify someone as an associate, even if you call them an advisor and have them enter into a consulting contract.

Penalties for misclassification can be severe. The people you hire to work in your startup are either employees or freelancers (usually called consultants by startups). . . .