It depends what your website does. A lot of websites are really just a simple online marketing asset, a digital sales brochure, that does nothing more than list your services, provide biographical information about the company’s employees or founders, and provide contact info. For that type of website, there’s no need to have a ToU because there’s no relationship that you need to manage between you and your visitors. You’re just pushing out information.
A ToU becomes essential if you’re doing any of the following:
- selling anything (goods or services) through the site. Now you’ll want a ToU to confirm the terms of your sale transactions, how refunds work, the quality standard that you pledge to meet, and much more.
- allowing visitors to upload photos, videos or artwork. You’ll want to protect yourself from liability for infringement of copyright; otherwise, if your site is hosting user-uploaded content that violates other people’s intellectual property rights, you could be at risk for huge copyright fines. There’s an easy way to avoid this: follow the Digital Millennium Copyright Act (DMCA), which lets you avoid liability if you promptly remove infringing content after complaints from owners of copyrighted materials. This only works if you have a ToU that contains quite specific DMCA language.
- hosting a forum where users communicate with each other. You’ll want your ToU to contain a code of conduct barring users from doing various bad things that people tend to do online – spamming, harassing each other, and so on.
- publishing anything written by users. Some companies (e.g. Quora, Reddit, Stackoverflow) derive value from crowdsourcing user-written content. Under the U.S. copyright laws, companies can’t monetize that content without having users “assign” (give) various rights to the companies, so the ToU will contain language that does so.
- finally, if your website does anything else that could create liability for you as the operator, you’ll want a ToU in which visitors agree to limit your liability in the event of a lawsuit.
Under well-settled contract law rules, a ToU becomes a binding agreement between you and your website’s visitors if it is written clearly and if you make its existence clear to all visitors at the time they visit the site. Visitors do not need to actually read the ToU, and usually they don’t. But it’s not your job to force visitors to read anything — your job is to make sure visitors are aware that there is a ToU and make it easy for them to read if they choose to. If you do that, you’ve done all that the law asks, and the ToU between you and your visitors will be enforceable.
Do these documents need to be written in boring legalese? What if I want to make them informal or even funny?
No! These don’t have to be boring. In fact, a lot of our clients prefer these to be written in an informal or “plain English” style. We encourage that! These documents serve legal purposes, but they’re also marketing assets — it’s okay to have them support your brand and customer experience. We feel so strongly about this that we wrote this longer article about our love for plain-English legal documents.