What should IT executives and owners look for in team interactions ?

The first thing to realise for yourself is that depending on the status of an individual team member, different aspects come under the category of “important”. Let’s take a closer look at some of them:

Co-author partners, founder

Among ourselves we call them “brothers”, as a rule, they are friends or relatives, with whom often no documents are signed in view of “trust relations”, which not infrequently becomes a big mistake leading to corporate conflicts, as well as problems with the product in the future.

1. We strongly recommend not to neglect signing contracts with such partners if they are directly involved in the product creation process. Even if you have a great relationship, the rights to the product without a contract will not transfer to the company, it may become a problem if this is revealed in the course of Due Diligence or the relationship with such a partner deteriorates, which in our practice, unfortunately, is not uncommon either.
    
2. We recommend agreements that restrict such team members from competition and poaching.

Individual entrepreneur, Freelancers

1. It is important to draft the contract correctly in general, ensuring the transfer of rights to all the results of the work.

   It is important to remember that in this model of interaction, the contractor acts as an independent business entity, and the relationship is b2b in nature.
    

2. Remember that it is in the company’s interest to ensure that the scope of work described in the documents/TOR corresponds to the tasks actually performed, even though in some cases this may be disadvantageous for the contractor (for example, it may not be able to apply a favourable tax rate in its jurisdiction). Otherwise, there may be issues with the identification of the work results, while correct reflection of the actual functionality performed in the documents will allow you to have a clearer position in case of a dispute.
    
3. It’s worth considering separate non-solicitation agreements (NSA) and non-competition agreements (NCA) with top team members.

Workers

Unlike the previous b2b category, employees have an employment relationship with the company, which implies a certain dependence on the company, as well as certain guarantees provided by law (clear working hours, holidays, etc.). For this reason, in addition to IP and confidentiality provisions, the contract should also reflect the “labour” provisions themselves.

Incubators

We would like to make a special mention of incubators, as such a scheme of work is increasingly used by Cypriot companies, especially when co-operating with team members based in Poland.

It should be realised that the whole chain of relations is usually as follows: Company – Incubator – Employee. 

Thus, it is in the company’s interest to ensure that both its relationship with the incubator and the incubator’s relationship with the employee are adequately documented.

‼️ It is important that the documents clearly trace the chain of transfer of rights from employee to incubator and from incubator to company.

According to our practice, incubators are reluctant to make changes to their standard forms of documents, but in some cases, making changes may become critical for the company.

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