Employment contracts outline the responsibilities of employees and employers, including work hours, compensation, and consequences for not meeting obligations. Development agreements define the scope of work a developer must complete for a publisher, including budgets, royalties, and creative control. License agreements allow developers to use established IP in exchange for fees or royalties paid to the IP holder. Non-disclosure agreements prevent testers and developers from discussing projects until release to protect intellectual property. Collaboration agreements specify ownership of indie projects, responsibilities of team members, profit sharing, and procedures for closing a project.

1. Gaming Contractual Issues:
Employment:
An employment contract usually involves both parties agreeing for certain things. For
example the employee will agree to work so many hours and to do so much work while the
employer will agree to pay them for said amount of hours and work. They usually contain
terms that if the employee fails to meet could have certain consequences and likewise for
the employer.
Development agreement:
Is usually when a party contacts another party and ask them to do a set amount of work for
them. For example a publisher could contact a developer and ask them to create a game for
them. The publisher would set terms like the amount of money they have to spend,
royalties and amount of time to complete the project. Similarly the developer can set terms
for who owns the IP or how much creative freedom they have so they can do what they
want with the project.
License agreement:
This is when a publisher or developer wants to use an already established IP (batman and
etc) they have to contact the original IP owner for permission to use it and they would have
to pay him/her so much or give a percentage of profits unless the IP holder allows them to
use it for free. Examples of license agreements would be Games Workshop allow Relic to
create games based on the Warhammer 40k IP in return for a percentage of profits.
NDA:
NDA or Non-disclosure agreement means that to see the product/content you must often
agree to not talk or disclose the things you see. So this usually means you are not allowed to
talk about the project. For example I’ve been a beta/alpha tester for several game projects
such as End of Nations and War of the Roses. Which are both titles that are going to be
released soon. To be a part of these tests I had to agree to a NDA and if I broke the NDA the
companies who hold the rights to the projects could do anything from disallowing my
involvement to outright suing me.

2. Collaboration agreement:
Collaboration agreements are the most frequent kind of contracts in the gaming industry.
This agreement is most important for indie developers/small groups of developers because
it covers the ownership of the project and who is responsible for doing certain things. For
example the main developer may get 50% of the profits and the sound designer gets 20%
then the artist and programmer get 15% each.
The majority of indie projects fail because they don’t make it clear who is responsible for
what and what they get for it. The collaboration agreement sets clear terms for how it’s
supposed to be run. It covers who owns the IP, how the game is intended to be used, how
much profit each member gets and closing the project is supposed to be done.