The use of email as the preferred form of business communication for businesses both big and small continues to grow year over year. However, this ubiquitous use of email does have some drawbacks.
Negotiating Agreements through Email
When it comes to negotiating agreements via email, the medium could open up a company to serious litigation. As a Palm Springs litigation attorney, we see these types of cased on a regular basis.
When an employee sends emails back and forth in an attempt to reach an agreement with an outside party they could be unknowingly entering into a binding agreement. A recent ruling by the Sixth Circuit Court of Appeals stated that agreements made in email correspondence without a reservation of rights bound both parties to the agreements.
One way companies can avoid being held to these agreements by explicitly stating that these emails are “for discussion purposes only,” or using an automatic footer in all emails stating that no communication (electronic or otherwise) can be considered a binding agreement without the signature of an authorized agent of the company.
Electronic Communications Policies
A company should also establish a formal electronic communications policy that explicitly states how employees and executives should use all manner of electronic communications. These policies should also include hands on training for all employees so that everyone is on the same page.
One other way to protect a company is to hold all high level negotiations via telephone or, even better, in person. This will help minimize any confusion and also insulate the company from any unwarranted lawsuits.