Avenues for communication and information sharing are evolving exponentially in our digital world. Social media, photo sharing, and instant messaging have worked their way into the fabric of our lives, and this week, we’ve discovered that one of the most influential corporations in our modern marketplace (Amazon) expects little or no consumer push-back on the suggestion that customers place a corporate controlled surveillance camera inside of their own homes…literally.
At the same time, with the rise of the gig economy and contingent employee-employer relationships, companies are exercising diminishing control over what their “employees” do, say, and share outside of the workplace.
But what happens to protected information if an employee leaves just after two weeks to do something else? What happens to a million-dollar idea that escapes out the door with a contract worker after a one-year service period with very few restrictions or limitations placed on either party? How can companies protect their content, code and business models? And just as important, how can service providers in a gig economy protect the intangibles that lie at the core of their careers and their ability to make a living (graphic art, code, notes, pitches, suggestions)?
While it’s important to speak with counsel about these issues, here a few practical suggestions.
1. When managing, companies have to have written policies in place for different types of service providers, and in particular, have to be well versed and knowledgeable about the differences between employees and contractors under state and federal law. Tax, intellectual property, and employee rights are all impacted by management practices. Companies also have to ensure that they have the right protections in place to ensure that company information stays with the company after the service provider leaves. Confidentiality and arbitration clauses are now under heavy scrutiny by courts because of perceived company-side abuse, so it is very important that these critical clauses are drafted in conformity with current best practice.
2. When hiring, companies need to make sure their hiring practices conform with state and federal labor laws. Not just anti discrimination and anti harassment policies -- a must for any modern company -- companies also have to think about whether the people they are hiring are properly classified as more traditional employees, or more loose “contract” or “gig” workers. The same legal frameworks that have governed labor law for decades is now being used to scrutinize “sharing” or “gig” economy startups.
3. When looking for new projects, idea-based gig workers should feel free to circulate their own contracts to potential clients. Gig workers should make sure that their contracts carry appropriate terms for payment of invoices and any agreed-to terms regarding ownership and licensing of intellectual property contained during the engagement. Sometimes, it may not be possible to negotiate contracts (or a gig worker may be working through an intermediary that requires that all participants use a standard terms-of-service contract). In that case, it’s still important to make sure that the terms are agreeable and fair.
4. When reviewing contract terms, examine the details carefully. As tech companies move into new areas to monetize relationships, particularly amongst professions like medicine and law, it is very important that contract terms are heavily scrutinized. Med-tech and Legal-tech startups are often run by engineers who have no background in the professions, and may be ignorant (or may not care) about ethical restraints such as fee-splitting, and client information protection (to name just a couple issues). Lawyers and doctors must be particularly careful with technology companies. Don’t assume that companies have a strong grasp of professional restrictions simply because they are in “tech”.