Unpaid non-executive director's service agreement

This non-executive director's service agreement is a contract for services for an unpaid, part-time director. It makes clear no contract of employment. It can be used for a fixed term or a running contract for a company director, or director-level equivalent in a charity or other organisation. It provides particularly strong protection of company information.

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About this unpaid non-executive director's service agreement

This is a service agreement that sets out the contract for services between a non-executive director and a company or other organisation. The director is not paid for his or her services, although may receive expenses. Ideal for charities, it should be used by any company or other organisation that requires a contract with an independent non-executive director who will gift advice and support on a voluntary basis.

This non-executive director's service contract is particularly strong on the protection of confidentiality and company secrets. It is flexible and can be used whether the term of the contract is fixed or running. Use of plain English makes editing easy and allows it to be understood by all parties.

This document provides a balance between protection for the director and for the company. If there is a difference in interests, we have favoured the company. Some of these provisions are required to comply with the law. The explanatory notes, which come with these documents, will guide you as to the importance of specific issues.

The law relating to this service agreement

This is a contract for services. It makes absolutely clear that the relationship between the director and the organisation is one of unpaid consultancy (help) rather than employment.

Despite there being no payment for services, the agreement provides for “consideration” so as to make the obligations of the director binding on him.

When to use this unpaid director's service agreement

  • Likely to be used by charities using unpaid advisors
  • appropriate for any non-executive, part-time director of any organisation

Service contract features and contents

  • Up to date with the latest changes in company law
  • Strong on protection of employer's confidential information
  • Structured so as to minimise the administrative burden of legal compliance

The service agreement contains 14 provisions including:

  • appointment;
  • director’s status;
  • meetings and work;
  • expenses;
  • responsibilities as director;
  • staff handbook and company policies;
  • confidentiality;
  • procedure after termination;
  • no competition;
  • data protection.
Draftsman

This document was written by a solicitor for Net Lawman. It complies with current New Zealand law.

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