Legal aspects
What points should be contained in professional interim management contracts?
To avoid problems and misunderstandings, interim managers and clients should ensure that contracts are professionally formulated. Apart from the contractual content on the nature and scope of the services, duration of the contract and the usual standard provisions, the following points should also be included (all specifications without guarantee and excluding all liability):
• Reporting paths and authority to issue directives
• Options to terminate and extend the contract
• Contract for work or services
• Secondary occupation
• Obligation to maintain secrecy, confidentiality
• Payment and expenses
• Restraint on competition
• Continuation and termination (proper and extraordinary termination as well as the effects of changes relevant to company law on the contractual relationship)
• Leave and holiday clauses
• Insurance clauses: Accident insurance, D&O (directors and officers liability insurance)
• Liability clauses
DDIM members will find detailed information on this subject in the extranet.
What is the legal tax and social security status of interim managers?
Interim managers are generally freelance entrepreneurs and work independently within their contractual agreements, acting as free agents, at their own risk. Working freelance, they pay taxes and social security contributions themselves.
How long are the notice periods?
As independent entrepreneurs, interim managers generally agree very short periods of notice.
What liability do interim managers bear for their services?
As independent entrepreneurs, interim managers are liable for any damage that results as they deliver their services unless these are contractually excluded or limited. Especially for clients where a corporate position is taken up (general manager, position on the board etc.), interim managers generally take out special liability insurance to cover this risk (e.g. financial loss insurance or so-called D&O - directors and officers liability insurance).