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Updated June 2, 2026
As an HR professional, it often feels like you’re a jack of all trades. Some days you’re a mediator, others you’re an employee engagement specialist, and some days you’re an HR law wiz. When it comes to drafting legal documents, it may feel like you should enroll in night law school or watch some Law & Order to handle the ever-changing tasks assigned to you.
While both your company and its employees may take these documents for granted, you know there’s a lot of strategic thinking and work that goes into drafting them. HR legal documents are not one-size-fits-all, especially when you take your local and state regulations into account—a key reason we recommend consulting a legal professional to review them before you roll them out.
But to help you draft your next HR legal documents, here are some pointers and considerations that should be top of mind:
What are Offer Letters?
The offer letter may be the most important legal document between a company and its employees. It sets up the expectations for how both parties will work together.
The cornerstone of the offer letter is to explain the scope of employment. In other words, what are the employee’s responsibilities? Is the employment at-will—meaning they can quit or be terminated for any legal reason, at any time—or is the employee being hired for a specific time period?
(As a side note, you may be interested to learn that the United States is one of the few countries where the employment relationships are predominately at-will. In most other countries, employees can only be terminated for cause.)
Another important piece of an offer letter is compensation, which goes beyond putting the employee’s salary in writing. In today’s world, you need to think in terms of “total compensation.”
For starters, think about how the compensation will increase. Is the employee eligible for annual raises? What about bonuses, commissions, stock options, or other common forms of incentive compensation?
Next, outline the benefits which the employee will be entitled to. What benefits are offered, and which will they participate in? How much vacation time and paid time off is the employee eligible for? Can vacation time roll over to the next year? Be sure to check your state and local laws as their regulations may vary on these subjects.
These are just the core parts you should include for every employee, regardless of your industry or the role. But for certain employees, you may also want to add sections that go over things like confidentiality or reimbursement of expenses.
What are Restrictive Covenants & Non-Competes?
Non-compete agreements—contracts that restrict employees from working for competitors for a defined period or within a specific geographic area, and related non-solicitation provisions—remain widely used tools for protecting business interests. When used appropriately, restrictive covenants can help safeguard trade secrets, confidential information, and customer relationships.
However, the legal landscape surrounding non-competes has shifted significantly in recent years.
In April 2024, the Federal Trade Commission (FTC) issued a rule that would have broadly banned most non-compete agreements nationwide. However, this rule never took effect. A federal court struck it down in August 2024, concluding the FTC lacked authority, and in September 2025, the FTC formally abandoned its appeal, leaving the rule invalidated.
As a result, there is currently no federal ban, and non-competes are still legal at the federal level. Instead, enforcement is expected to occur through targeted agency actions and antitrust challenges rather than a sweeping rule.
Current Reality: State-by-State Patchwork
Today, the enforceability of non-compete agreements is governed almost entirely by state law, and the rules vary widely.
- Full bans: Several jurisdictions—including California, Minnesota, North Dakota, Oklahoma, and Montana—generally prohibit non-compete agreements in employment contexts (with limited exceptions, such as the sale of a business). [beckersasc.com]
- Strong restrictions: Many states (including Colorado, Illinois, Washington, and others) allow non-competes but only under strict conditions, such as:
- Minimum salary thresholds
- Limits on duration and geographic scope
- Requirements tied to trade secrets or legitimate business interests
- More permissive states: Some states still enforce non-competes under traditional “reasonableness” standards but are increasingly scrutinizing overly broad agreements.
Overall, four states fully ban non-competes and more than 30 states impose meaningful restrictions, reflecting a clear nationwide trend toward limiting their use.
What are Non-Disclosure Agreements and Invention Agreements?
While non-disclosure agreements (NDAs) are also meant to protect important information, they are different from non-competes. These agreements specify who owns intellectual property and typically claim that anything developed, written, produced, or invented during employment is owned by the company.
These agreements can also prevent employees from discussing certain projects or information for a specified period of time. For example, if the company is ramping up for a super-secret new product release, employees working on the project may be required to sign a confidentiality agreement.
What are Retention Bonus Agreements?
As companies evolve, it’s only natural that some may get acquired or go through another significant “life” event (e.g., going public, being spun off, etc.). Whatever the reason, there may be occasions in which you need to ensure that certain key employees stay with the company to help the company navigate the circumstances.
If that’s the case, a retention bonus agreement may be your best friend. Retention bonus agreements promise the employee a certain amount of money if he or she stays with the company for a certain period of time.
With these you need to be very careful in clearly drafting the conditions under which the bonus will kick in (i.e. Is it just the passing of time? Is it the accomplishment of certain milestones, like the closing of an M&A deal?). It is also smart to divide the payment into installments to incentivize the employee to stay longer.
What are Employment Handbooks?
An employee handbook isn’t the same thing as an offer letter, but it’s equally important.
The U.S. Small Business Administration defines employee handbooks as “an important communication tool between you and your employees.
A well-written handbook sets forth your expectations for your employees, and describes what they can expect from your company. It also should describe your legal obligations as an employer, and your employees’ rights.”
A well-written employee handbook will save you from many HR headaches. Employee handbooks should address topics like:
- company values,
- non-discrimination and anti-harassment policies,
- how to report workplace incidents,
- safety and security,
- use of company technology,
- protecting company property,
- overtime policies,
- leaves of absence,
- and standards of conduct.
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The next time you need to draft any of the above HR legal documents, you may want to use this guide to help you think through the process and to remember the most important considerations. Happy drafting!
The content of this publication is provided for informational purposes only and does not contain or constitute legal advice. You should not act on this information without seeking legal professional counsel.
