The Founder's Legal Starter Kit: What You Need Before Your First Contractor

Before your first contractor sends an invoice, you need three things locked down: a signed agreement with an IP assignment clause, clarity on whether the relationship actually holds up as a contractor relationship (not just what you call it), and an NDA if they're going to see anything sensitive. A friendly email with a rate in it covers none of that.

Why a friendly email isn't an agreement

It feels efficient. You found someone good, agreed on a rate, and they started work. The problem is that “agreement” implies terms, and an email thread rarely has any. No defined scope, no payment terms if the project changes shape, no IP assignment, nothing that protects you if the relationship goes sideways. It works right up until it doesn't, and that's usually the moment you can least afford the gap.

The three documents, in order

1. A contractor agreement with a real scope of work and an explicit IP assignment clause, signed before they start
2. Confirmation that the relationship is actually structured like a contractor relationship, not employment with a different label
3. An NDA, if they'll see your financials, your roadmap, your customer list, or anything else you wouldn't want repeated

Skip the order and you end up backfilling paperwork after the fact, which protects you far less than getting it signed on day one.

The classification question you can't skip

Calling someone a contractor doesn't make them one. Canadian courts, and the CRA's own test for determining employment status, look at the actual relationship: how much control you have over how and when the work gets done, whether they can work for other clients, who owns the tools. Get it wrong and the exposure is real — back pay, source deductions, employment standards penalties. We wrote a full breakdown of how that test actually plays out for founders, and where they get tripped up, in Employee vs. Contractor in Canada, worth reading before you send the first contract.

If they'll see anything sensitive

If the engagement means sharing financials, a customer list, or a product roadmap that isn't public, that's an NDA conversation before the contractor agreement, not instead of it. We covered when an NDA is actually worth the ask, and when it isn't, in NDAs: When You Actually Need One.

What happens if you skip this

Usually nothing, until the exact moment it matters: a financing round asks for your IP chain of title and there's a gap, or the relationship ends badly and “we just stopped sending work” isn't a clean exit. None of this needs to slow you down. It needs fifteen minutes with a lawyer before day one, not fifteen hours of cleanup after.

Ruby drafts contractor agreements, with the IP assignment clause built in, for a flat fee starting at $299 — lawyer-reviewed, plain-language summary included. Tell us about your matter and a Ruby lawyer will follow up directly.